By Sarah L. Stewart
Jim Grote was 10 when he got his start in business delivering newspapers in Columbus. By 13, he was slinging pepperoni instead of papers, at a time when pizza was still a relatively new item. At 19, the altar-boy-turned-entrepreneur opened a pizza shop of his own, with $1,300 of borrowed money and an ideal: To always treat others as he’d like to be treated.
Whether that meant putting 100 slices of pepperoni on every large pie, or giving back to the community, Grote was determined that the Golden Rule would be his guide, and named the restaurant Donatos, after a Latin word meaning “to give a good thing.” Early on, Grote remembers getting—and ignoring—some cutthroat advice regarding his philosophy.
“‘If you keep those principles, you’re going to fail,’” he was told. “‘You’ve got to get to the competition before they get to you.’ I said, ‘That’s crazy. If I can’t keep my principles and make money, then business is bad, and free enterprise is bad.’”
In business since 1963, the company has 159 stores in 10 states, and Grote’s idealism has guided its growth.
“For the last 50 years, we’ve been making money,” he says, “and keeping our principles.”
(Photo by Jay LaPrete)
Working harder, smarter
Family was the foundation of Donatos from the beginning, down to the cash Grote borrowed from his father and future father-in-law to open his first shop. He made dough in his mother’s kitchen, his brothers and brothers-in-law delivered pizzas, and his children swept the parking lot and helped make sauce and meatballs.
Grote moved his family into a house behind the shop, where the four children socialized with customers, says his daughter, Donatos Chairwoman Jane Grote Abell.
“We literally grew up with our customers,” Abell says.
In those early days, Grote says he logged 100-hour weeks.
“I wasn’t comfortable not being at the place,” he says. “Those years were me trying to figure out how to take care of the business.”
That meant innovating, streamlining the pizza-making process to make it faster and more consistent. Placing pepperoni one piece at a time took too long, so Grote invented a hand-operated machine that covered a pizza in seven seconds. He patented it in 1972, and two years later, partnered with his produce supplier to open a second location with a $30,000 loan from Huntington.
From the outset, Grote had big plans. Abell remembers standing with her father beneath the Donatos sign as he described his vision for spreading the company’s values.
“He’d say, ‘One day, we’re going to be all over the world,’” she says. “It was never, ‘We’re going to make this much money.' He always said, ‘We’re going to have an opportunity to make a difference in every neighborhood we go into, and we’re going to bring our principles with us.’ It was always bigger than the pizza.”
That meant giving back to the communities it served. For example, in Dayton, it offers Pink Ribbon Dessert Twists, donating 50 cents for every twist sold to the Breast Cancer Foundation of Dayton. It also donates to local organizations, and employees can contribute to a fund that helps offset medical and funeral expenses for every employee.
That community spirit helped the company to continue to grow, and by 1999, Donatos had reached 17 stores. But a big change was on the way: Grote sold the company to an international fast food chain. After 36 years, Donatos was out of the family—but not for long.
Paying it forward
Four years later, the fast food chain’s CEO put Donatos up for sale. Abell had an idea.
“She said, ‘All our people are there, they’re doing what we believe in; we can’t let them break this up. We’ve got to buy the company back,’” Grote says.
For Abell, the decision came back to the values her father had instilled.
“It wasn’t about the finances,” she says. “It was about the people. We’re in business because we believe in the power of love.”
Donatos had grown to nearly 200 stores but was losing money. The family scaled back the number of locations and returned to the delivery-only model.
Today, Donatos continues to expand at a healthy pace, and at 75, Grote is still pushing the envelope. His latest project, The Edge Innovation Hub, is an incubator for new businesses looking to disrupt the food industry. And Abell has focused her energy on the Reeb Avenue Center, a once-abandoned elementary school in south side Columbus that now serves as a hub for community resources. And her plan for Donatos—to expand its reach to communities around the world—closely mirrors her father’s aspirations.
“My dad’s vision standing under that sign was to be a global company doing business with love,” she says. “I hold onto that same vision.”
(Photo by Jay LaPrete)
Taking a chance
Jim Grote was in his early 20s, with one successful Donatos location, when he walked into a Huntington branch in Columbus and asked the bank manager for a $30,000 loan to open a second location.
“He said, ‘OK,’” Grote says. “He was the start of the expansion for Donatos. That was a big leap of faith.”
Nearly a half-century later, Donatos’ relationship with Huntington continues to flourish.
“Huntington is with us on about every part of our growth,” Grote says.
The relationship is founded not only on that first loan but on similar values shared by both organizations.
“They have a great culture,” he says. “Our principles are really aligned with them, and I have a tremendous loyalty to Huntington.”
For more information, please visit donatos.com.