A strong work ethic and intense desire to make something of his life, led Tom Monaghan (born 1937) from the orphanages of Michigan to the creation of the second-largest pizza chain in the world. His business grew from a single $500 store in Ypsilanti, Michigan, to over 6,100 franchised and company-owned stores in 64 countries, with revenue of over one billion dollars.
Until 1998, when he sold Domino's Pizza to Bain Capital for a billion dollars, Thomas S. Monaghan was known as the driving force that built the world's second-largest pizza company, behind Pizza Hut Inc. Monaghan was an innovator in the pizza industry and set the standards for other companies. He developed dough trays, the corrugated pizza box, insulated bags to transport pizzas, the pizza screen, a conveyor oven and a unique franchise system enabling managers and supervisors to become franchisees. He was also a flamboyant spender, who bought and sold the Detroit Tigers baseball team, Drummond Island, the biggest Frank Lloyd Wright collection in the world, a multi-million dollar collection of automobiles, a helicopter, and several airplanes. He devoted his vast resources to helping Catholic causes. Monaghan donated $3.5 million to the rebuilding of the cathedral in Managua, Nicaragua, and supported a mission in the Honduran mountain town of San Pedro Sula. According to an interview in The New York Times, February, 14, 1999, Monaghan stated, "I don't want to take my money with me when I go, and I don't want to leave it for others. I want to die broke."
Sent to Orphanage as Child
Tom Monaghan was born in the university town of Ann Arbor, Michigan on March 25, 1937, to Francis Monaghan, a truck driver, and Anna (Geddes) Monaghan. The family lived in a small farmhouse built by his father on land purchased from his grandmother. Water came from a near-by stream until they could afford a pump. When he was four years old, his father died of peritonitis on Christmas Eve, 1941.
Since his mother earned only $27.50 a week, she was forced to send Monaghan and his brother to a foster home and finally to the St. Joseph Home for Boys. He lived there for six and a half years, until his mother was able to reclaim him. From this experience, Monaghan developed his love for the Catholic church, an appreciation of architecture from taking care of the huge old mansion where he lived, and a sense that he could achieve anything from his beloved teacher, Sister Berarda. In other respects, the high spirited young man did not like the regimentation of life in an orphanage, which he equated to prison in his autobiography Pizza Tiger.
His mother completed nursing school when he was in the sixth grade. She began work at Munson Hospital in Traverse City, Michigan, and brought the boys to live with her. Monaghan helped financially by growing and selling vegetables from the backyard, catching and selling fish from Lake Michigan, and selling the Traverse City Record Eagle in front of Miliken's Department Store in the center of town. By this time he had become difficult to manage and was never able to live with his mother for long periods of time without disrupting the household.
Monaghan was sent to a foster home and attended St. Francis High School in Traverse City. As he stood knee deep in manure in his foster home's barnyard, he had a revelation that he wanted to be a priest. His parish priest arranged for him to enter St. Joseph's Seminary in Grand Rapids, Michigan, but he could not handle the discipline and was asked to leave in less than a year, for pillow fights and talking in chapel. In Pizza Tiger Monaghan admitted, "Never before or since have I felt so crushed. I am no stranger to failure, but no other setback devastated me as this one did, because it was so final."
Struggled at School
After leaving the seminary, Monaghan returned to Traverse City and and attended St. Francis High School for a short time. His mother, becoming exasperated with his antics, placed him in a juvenile detention home. When his aunt and uncle found out, they were able to get him refleased into their custody. Monaghan finished forty-fourth in a class of forty-four at St. Thomas High School in Ann Arbor, Michigan. He hoped to go to college, but his grades were poor and he had no money. Monaghan enrolled in architectural trade school at Ferris State College in Big Rapids, Michigan, and worked at odd jobs to pay his tuition. He hoped to transfer to the University of Michigan, but lacked the funds. A poster advertised paid college tuition if he joined the army. This caught his attention and he filled out all the paperwork before realizing that he had joined the Marines.
After successfully completing his three year tour of duty in the Marines on July 2, 1959, Monaghan naively invested the $2,000 he had saved for tuition in a get-rich-quick oil scheme. He never saw his money again. Monaghan planned to attend the University of Michigan in the fall of 1959, but became ill with an infected eardrum and did not earn enough money to even afford the text books. He tried again in the spring of 1960, but dropped out after only three weeks.
From this inauspicious beginning one would not expect Monaghan to become a billion dollar businessman and philanthropist. In September 1960, his brother, Jim, heard that a pizza shop in Ypsilanti, Michigan, was up for sale. The owner was asking $500.00 plus about $400.00 in debts. The brothers bought the business, naming it Domino's Pizza. They had no intention of making this a life long career. Jim kept his post office job and Tom intended to return to the University of Michigan. Jim soon sold his half of the business to his brother for a 1959 Volkswagen Beetle that had been used as a delivery vehicle. Monaghan threw himself into the business of making the best pizza in the world. He created a very simple menu. He investigated what made the best sauce, purchased the highest quality toppings, made the freshest dough, used the most expensive flour and cheese, and guaranteed delivery as rapidly as possible. Business did well enough to open a second store in Mt. Pleasant, Michigan, catering to college studentds. Working 18-hour days and visiting more than 300 rival pizzerias, Monaghan utilized the best techniques and invented his own when none existed to stay in the forefront of the industry. In 1967, he sold his first franchise.
All Did Not Go Smoothly
As the business continued to grow, Monaghan had to face a number of challenges. In 1967, a fire destroyed his anchor store in Ypsilanti, which supplied the other stores with food, as well as the company's offices. Most of the damage was not covered by insurance. By 1970, unrestrained expansion had put Domino's into $1.5 million dollars of debt. Monaghan turned the company over to Ken Heavlin, a local businessman on May 1, 1970, to avoid bankruptcy. Within a year he regained control and by 1973 Domino's had recovered. In September 1975, Amstar Corporation, the manufacturer of Domino Sugar, sued for infringement of trademark. That lawsuit continued until 1980 when a federal Court of Appeals judge ruled that the name Domino's Pizza was unlikely to be confused with Domino Sugar.
As Monaghan became distracted by other interests, his company began a gradual decline. In 1990, he was forced to to sell some of his prized possessions and focus more attention on his business in order to return it to profitability. Domino's lost $78 million dollars in a court case to a woman injured by a company driver. As a result, the company decided to give up its guarantee of "delivery in thirty minutes or the pizza is free." Monaghan survived a boycott by the National Organization of Women because of his support of conservative candidates who were against abortion. He also faced opposition from various gay rights groups because of his support of the Catholic Church's position on homosexuality.
Bought and Sold Detroit Tigers
Realizing a boyhood dream, Monaghan was able to purchase the Detroit Tigers baseball franchise in 1983 from John E. Fetzer for $53 million. He won a World Series in his first season as owner. According to Charlie Vincent, a columnist for the Detroit Free Press, February 14, 1992, "He reveled in the glory for a while, then said Detroit fans were the worst in the world." Vincent added, "Nothing was done to develop the people of Detroit as fans or the kids of Detroit as baseball players or baseball lovers." He fired Ernie Harwell, Detroit's favorite sportscaster and demanded that the taxpayers finance a new stadium, at a location of his choice. In 1992, Monaghan sold the team to his rival in the pizza business, Mike Ilitch, owner of Little Caesars Pizza.
Frank Lloyd Wright Collection
As as a result of his lifelong love of architecture, Monaghan amassed one of the world's largest collections of furniture and artifacts created by Frank Lloyd Wright. At its peak, his collection had more than 300 items valued at $30 million. Monaghan established the National Center for the Study of Frank Lloyd Wright and built a 10,000 square-foot museum to hold the collection. In 1993, Monaghan closed and emptied the museum and began to sell the collection. He retained the "Prairie House" on the grounds of Domino Farms, which was built in the style of Wright's prairie houses.
At one point in his career, Monaghan owned over 250 antique automobiles, including an eight million dollar 1932 Bugatti Royale, housed in an museum especially built for them. He purchased Drummond Island, a resort on the Michigan-Ontario border with its own golf course called Pepperoni Links. Monaghan also owned five boats, three planes, and various other companies.
Dedication to the Catholic Church
In 1998, Monaghan sold Domino's Pizza for a billion dollars, intending to devote the rest of his life and his money to spreading the Christian gospel, especially to the business elite. According to a February 14, 1999 article that appeared in the New York Times, a book changed the direction of his life. After reading Mere Christianity by C.S. Lewis, Monaghan decided to give up his sin of pride and rededicate himself to God.
After meeting Pope John Paul in 1987, Monaghan founded Legatus (Latin for "ambassador"), to encourage Catholic executives to spread the Faith in their business and personal lives. Legatus now has 25 American chapters with more than 1,300 members, as well as groups in Canada, Mexico, and Honduras. The organization is funded through another of his charities, the Mater Christe Foundation. Monaghan also provided funding for the Ave Maria College; the conservative newspaper, Credo; a radio station; and the Thomas Moore Law Center. All are based in the Ann Arbor, Michigan area.
Monaghan, Thomas and Robert Anderson, Pizza Tiger, Random House, 1986.
Crain's Detroit Business, September 28, 1998, p.1.
Detroit Free Press, November 5, 1990, p. 10F; February 14, 1992, p.1D.
Detroit News, February 7, 1993, C; December 22, 1993, p. A1;December 15, 1994, p. G3; September 27, 1998, p. C1; October 3, 1998, p. C3.
New York Times, February 14, 1999, Section 3, p. 1
U.S. News & World Report, July 29. 1991, p. 43.
Media Kit, Domino Farms Headquarters, 1999 □