9 ms·

Burger King's CEO Is 33

90 points by AVTizzle 12y ago

circa 12y ago
I miss the creepy King commercials. Those were the best.
- strozykowski 12y ago
  We can't forget the Subservient Chicken.
  - smacktoward 12y ago
    Those all had more to do with BK's ad agency at the time, Crispin Porter + Bogusky (http://en.wikipedia.org/wiki/Crispin_Porter_%2B_Bogusky http://en.wikipedia.org/wiki/Crispin_Porter_%2B_Bogusky). CP+B is famous for creating highly viral, somewhat weird, vaguely unsettling campaigns.
    - batbomb 12y ago
      My friend worked at CP+B for a while (he's now creative director at EVB). I don't think he worked directly on the BK stuff, but I think he did have a hand in some of it. What he did actually work on was most of the Dominos commercials, (the LARPing and exploding car bit), some Best Buy stuff, some viral things. We used to get private youtube links of a lot of their commercials before they aired.
mrspeaker 12y ago
Where did the Britney Spears thing come from? It's not in the article... or is it the generally accepted "football-fields-long" of age?
- qq66 12y ago
  Also, Britney Spears is 32. Should they have said the CEO is one year older, and the CFO younger?
- Cuuugi 12y ago
  I thought she was like 40 something.
  - Cuuugi 12y ago
    Downvote all you want, the lady's got some miles on her.
- dang 12y ago
  The title was badly editorialized. Submitters: that's against the guidelines. Please don't do it.
walshemj 12y ago
So excessively young CEO often indicates problems (ie no one else would take the risky job) maybe its time to short there stock
- cowsandmilk 12y ago
  He was appointed June 7, 2013. Since his appointment, BKW is up 43%. the S&P 500 is up 22%. DOW Jones is up 13%. In his industry: Mcdonalds down 1% Wendys up 39% Jack in the box up 56%. Panera down 22% Chipotle up 77% Does not seem like Burger King is hurting on the stock market from his leadership.
  - chillingeffect 12y ago
    Yes, but that is actually on par with the entire restaurant industry for the last year. It did shockingly well. I blame cell phones and people too lazy to cook! Still though, I don't see BK as stock to short. Above someone said execs may be emptying it out, but at the same time, I see treeeeemendous upside in BK (and McDonald's). The other fast-risers (like Panera) are showing how to do it, and BK and McD have the infrastructure already in place. They could seriously upgrade their quality to next level. You see this happening in the auto industry. Remember how Kias used to suck? Remember how Hyundais used to suck? And remember a generation before them how Toyota and Nissan were low-end? These restaurants could mature by supplying what people want, such as slightly healthier food.
- RankingMember 12y ago
  Who determines the age considered to be "excessively young" for a CEO? I'd imagine the most obvious metric is stock performance, and it speaks for itself in this case.
  - walshemj 12y ago
    There is a noticeable trend in business for "risky" jobs to be taken by female and BME candidates.
fred_durst 12y ago
> Financial engineering Could not have said it better myself. He's just there to facilitate the transition of Burger King into a brand property play. There is little or no company left to run. The buyout and sale of 1,200 locations was the tough part. A young CEO is perfect for staying out of the way and doing what he's told while they expand royalty payments unsustainably based on the prior trust in the Burger Kind brand in order to pump money out of it until its worthless.
- deskamess 12y ago
  When BK disposes of restaurants how much control does it have and how much does the franchisee have. Is it just the royalty or are there some other binds? If the royalties go higher how easy would it be for the restaurant owner to switch to another fast food type restaurant/franchise. How much could BK (Corporate) block that move?
- 7Figures2Commas 12y ago
  While your comment might be a little bit too cynical, I don't think it's far off from reality. Over time, it'd be very surprising if Burger King's lack of company stores didn't catch up with it. These stores are the best channel for taking the pulse of the market. It's very hard to see a company maintaining its brand and evolving with the market with what basically amounts to a franchise-only play. It's worth noting that Chipotle, which does not currently franchise, is absolutely killing it from both a financial standpoint[1] and a customer experience standpoint[2]. Burger King's model has an attractive financial profile (for now) but according to the same recent Consumer Reports survey that gave Chipotle top marks in its category, Burger King received one of the worst marks for burgers. More interestingly, based on a quick glance at the Consumer Reports rankings, it appears there may be a correlation between customer perception of product quality and the percentage of company stores. In Burger King's category (burgers), the number two chain, In-N-Out, doesn't franchise, and the number one chain, The Habit, just started franchising last year and is still relatively small. Food for thought, no pun intended. [1] http://www.equities.com/editors-desk/stocks/consumer-discretionary/chipotle-rolls-up-some-fat-earnings http://www.equities.com/editors-desk/stocks/consumer-discret... [2] http://news.investors.com/business/070214-707190-mcdonalds-yum-lose-taste-test-chipotle-tops.htm http://news.investors.com/business/070214-707190-mcdonalds-y...
dublinben 12y ago
I wonder what their customer demographics are like in the US. I don't eat fast food, and probably haven't been to a Burger King in over a decade. Somehow they're still running thousands of profitable locations though.
- chiph 12y ago
  I get the impression that they appeal to lower-income people. Personally, I stopped going there when they switched to coated fries. Note to restaurateurs: I don't care how good the burger is -- if you have bad fries, I'm not eating there.
soneca 12y ago
"Jorge Paulo Lemann, 3G’s 74-year-old billionaire co-founder, likes to enlist young executives and put them in top positions at the firm’s companies." Do you remember PG essay about the PR submarine? That's more like it. Make no mistake, Jorge Paulo Lemann and the other two billionaire partners are among the best business men in the world. They got there building huge business after huge business (not like the gambler ex-billionaire Eike Batista). So there are 3 very smart, wise (and old) guys telling these young smart folks where to go and what to do. Not micro-managing, of course, but the biggest, toughest decisions are theirs. So it is very different in autonomy and leadership from public companies CEOs. And a world of distance of Zuckerberg's owner, founder, CEO, rules-it-all role. PS: I don't want to minimize the young guys success, I am sure they worked hard and smart and deserve their positions. Just clarifying what exactly means the "CEO role" here - according to my own personal opinion, of course.
- vm 12y ago
  Having met Schwartz and his team, I think you'd be surprised by how he describes his role: it's simple. That's why he can do the job at a young age. Burger King sells a well-known product in a predictable market. They don't invent crazy new things. They operate efficiently and scale operations that work. Facebook pioneers technology and products that the world hasn't seen before. For Facebook to do so well requires a combination of grand vision, operational effectiveness, recruiting and managing ultra-high caliber talent, and more. Burger King isn't an "easy" business to run but it's a well-defined business with a simpler playbook than a company like Facebook. I'm sure BK's investors are great advisors but I suspect the company's success is because of the highly capable team tackling a market with a well defined playbook.
  - drum 12y ago
    "They don't invent crazy new things." In the world of fast food, I see this as a problem. Taco Bell released the Dorito Loco Taco which has now made its way on to the main menu. Subway releases new promotional subs and items like the Flatizza, it seems almost bi-monthly. While the latter may not be as big of a success, it still garners awareness. I can't think of one "crazy" item Burger King has released in the last few years.
batbomb 12y ago
I went to Puerto Rico recently and one thing I remember was how strange it seemed to me how much more popular Burger King was versus McDonalds there. I'm not sure if this is a general Latin American (including Miami?) trend, but I just remember it being a little noteworthy. Here's a picture I found of (supposed) market share in Puerto Rico, for example: http://dialog.scarborough.com/wp-content/uploads/2013/05/Puerto-Rico-Burgers-e1369863169485.png http://dialog.scarborough.com/wp-content/uploads/2013/05/Pue...
- wcfields 12y ago
  Maybe it's because Burger King is more willing to make their items spicy?
- chuck8088 12y ago
  Basically 1 company owns all the fast food restaurants in Puerto Rico. This company owns 0 McDonalds franchises.
AndrewKemendo 12y ago
>Burger King Is Run by Children I don't think Businessweek could have come up with a more patronizing headline if they had tried to. Kudos to Jorge Paulo Lemann, William Ackman and others who can see value regardless of age.
gdilla 12y ago
More context here: http://www.businessweek.com/articles/2013-08-29/the-brazilian-billionaire-who-controls-your-beer-your-condiments-and-your-whopper http://www.businessweek.com/articles/2013-08-29/the-brazilia... "In two years under Hees the company more than doubled its margins, as measured by Ebitda (earnings before interest, taxes, depreciation, and amortization), Wall Street’s preferred gauge of cash flow. He did this in part by recasting Burger King as an owner of franchises rather than an operator of restaurants and sold off locations owned by the company. This allowed Hees to shove about 28,000 employees off Burger King’s balance sheet. It also meant the company didn’t need to spend as much to refurbish aging restaurants; instead, it offered incentives and lined up loans for franchisees to revamp their locations, replacing dull old plastic countertops with shiny metallic surfaces and futuristic stripes of neon. "
rayiner 12y ago
The Britney Spears reference is silly: she's 32, closing in on what the U.S. census defines as "middle age" (35-55). It's not that unusual. E.g. Jamie Dimon was President of Travelers at 36.
zheshishei 12y ago
"In 2009, Burger King put the $1 Double Cheese Burger on the menu. The item increased sales, which meant Burger King collected more in royalties. But franchisees abhorred it: They couldn’t make money selling a big cheeseburger for a low price. The Burger King franchisee association sued the company to get the burger off the menu. “It was beyond toxic,” says consultant Knapp of the chain’s relationship with its franchisees at the time." I subsisted off the $1 Double Cheeseburger for a year in college. Now I feel rather guilty about it. Oops.
jqm 12y ago
I live in a small town in the South West US. Well over 50% of the town is Latino. There was one BK in town and it closed. For several years there was no BK. Then, a new one was opened around 2 years ago and it was quite the event. For weeks the line stretched for hundreds of feet through the parking lot (they actually had to put up cones to snake it around) and you couldn't get a seat. I personally don't care for BK at all and scratched my head about this. Their food is abominable in my opinion... not to be negative but it just is what it is. It frankly tastes like they put sugar in their hamburger and they probably single handedly use 30% of the mayo consumed in the US. But maybe they have something that appeals to a certain group of people. Apparently they do. The restaurant is still consistently pretty busy. I went once just to find out if they were as awful as I remember and determined they were worse. But in certain demographics they appear to remain popular. No point... I just found all this interesting.
Scoundreller 12y ago
"They talk about the need to instill everybody at Burger King with an “ownership mentality,” meaning mainly that employees should husband the company’s money as if it were their own." I always translate this to: "Share in the losses, and maybe, just maybe, we'll share some of the wins with you, if there's enough after satisfying our insatiable desires"

90 points by AVTizzle 12y ago

circa 12y ago

I miss the creepy King commercials. Those were the best.

strozykowski 12y ago
We can't forget the Subservient Chicken.
- smacktoward 12y ago
  Those all had more to do with BK's ad agency at the time, Crispin Porter + Bogusky (http://en.wikipedia.org/wiki/Crispin_Porter_%2B_Bogusky http://en.wikipedia.org/wiki/Crispin_Porter_%2B_Bogusky). CP+B is famous for creating highly viral, somewhat weird, vaguely unsettling campaigns.
  - batbomb 12y ago
    My friend worked at CP+B for a while (he's now creative director at EVB). I don't think he worked directly on the BK stuff, but I think he did have a hand in some of it. What he did actually work on was most of the Dominos commercials, (the LARPing and exploding car bit), some Best Buy stuff, some viral things. We used to get private youtube links of a lot of their commercials before they aired.

mrspeaker 12y ago

Where did the Britney Spears thing come from? It's not in the article... or is it the generally accepted "football-fields-long" of age?

qq66 12y ago
Also, Britney Spears is 32. Should they have said the CEO is one year older, and the CFO younger?
Cuuugi 12y ago
I thought she was like 40 something.
- Cuuugi 12y ago
  Downvote all you want, the lady's got some miles on her.
dang 12y ago
The title was badly editorialized. Submitters: that's against the guidelines. Please don't do it.

walshemj 12y ago

So excessively young CEO often indicates problems (ie no one else would take the risky job) maybe its time to short there stock

cowsandmilk 12y ago
He was appointed June 7, 2013. Since his appointment, BKW is up 43%. the S&P 500 is up 22%. DOW Jones is up 13%. In his industry: Mcdonalds down 1% Wendys up 39% Jack in the box up 56%. Panera down 22% Chipotle up 77% Does not seem like Burger King is hurting on the stock market from his leadership.
- chillingeffect 12y ago
  Yes, but that is actually on par with the entire restaurant industry for the last year. It did shockingly well. I blame cell phones and people too lazy to cook! Still though, I don't see BK as stock to short. Above someone said execs may be emptying it out, but at the same time, I see treeeeemendous upside in BK (and McDonald's). The other fast-risers (like Panera) are showing how to do it, and BK and McD have the infrastructure already in place. They could seriously upgrade their quality to next level. You see this happening in the auto industry. Remember how Kias used to suck? Remember how Hyundais used to suck? And remember a generation before them how Toyota and Nissan were low-end? These restaurants could mature by supplying what people want, such as slightly healthier food.
RankingMember 12y ago
Who determines the age considered to be "excessively young" for a CEO? I'd imagine the most obvious metric is stock performance, and it speaks for itself in this case.
- walshemj 12y ago
  There is a noticeable trend in business for "risky" jobs to be taken by female and BME candidates.

fred_durst 12y ago

> Financial engineering Could not have said it better myself. He's just there to facilitate the transition of Burger King into a brand property play. There is little or no company left to run. The buyout and sale of 1,200 locations was the tough part. A young CEO is perfect for staying out of the way and doing what he's told while they expand royalty payments unsustainably based on the prior trust in the Burger Kind brand in order to pump money out of it until its worthless.

deskamess 12y ago
When BK disposes of restaurants how much control does it have and how much does the franchisee have. Is it just the royalty or are there some other binds? If the royalties go higher how easy would it be for the restaurant owner to switch to another fast food type restaurant/franchise. How much could BK (Corporate) block that move?
7Figures2Commas 12y ago
While your comment might be a little bit too cynical, I don't think it's far off from reality. Over time, it'd be very surprising if Burger King's lack of company stores didn't catch up with it. These stores are the best channel for taking the pulse of the market. It's very hard to see a company maintaining its brand and evolving with the market with what basically amounts to a franchise-only play. It's worth noting that Chipotle, which does not currently franchise, is absolutely killing it from both a financial standpoint[1] and a customer experience standpoint[2]. Burger King's model has an attractive financial profile (for now) but according to the same recent Consumer Reports survey that gave Chipotle top marks in its category, Burger King received one of the worst marks for burgers. More interestingly, based on a quick glance at the Consumer Reports rankings, it appears there may be a correlation between customer perception of product quality and the percentage of company stores. In Burger King's category (burgers), the number two chain, In-N-Out, doesn't franchise, and the number one chain, The Habit, just started franchising last year and is still relatively small. Food for thought, no pun intended. [1] http://www.equities.com/editors-desk/stocks/consumer-discretionary/chipotle-rolls-up-some-fat-earnings http://www.equities.com/editors-desk/stocks/consumer-discret... [2] http://news.investors.com/business/070214-707190-mcdonalds-yum-lose-taste-test-chipotle-tops.htm http://news.investors.com/business/070214-707190-mcdonalds-y...

dublinben 12y ago

I wonder what their customer demographics are like in the US. I don't eat fast food, and probably haven't been to a Burger King in over a decade. Somehow they're still running thousands of profitable locations though.

chiph 12y ago
I get the impression that they appeal to lower-income people. Personally, I stopped going there when they switched to coated fries. Note to restaurateurs: I don't care how good the burger is -- if you have bad fries, I'm not eating there.

soneca 12y ago

"Jorge Paulo Lemann, 3G’s 74-year-old billionaire co-founder, likes to enlist young executives and put them in top positions at the firm’s companies." Do you remember PG essay about the PR submarine? That's more like it. Make no mistake, Jorge Paulo Lemann and the other two billionaire partners are among the best business men in the world. They got there building huge business after huge business (not like the gambler ex-billionaire Eike Batista). So there are 3 very smart, wise (and old) guys telling these young smart folks where to go and what to do. Not micro-managing, of course, but the biggest, toughest decisions are theirs. So it is very different in autonomy and leadership from public companies CEOs. And a world of distance of Zuckerberg's owner, founder, CEO, rules-it-all role. PS: I don't want to minimize the young guys success, I am sure they worked hard and smart and deserve their positions. Just clarifying what exactly means the "CEO role" here - according to my own personal opinion, of course.

vm 12y ago
Having met Schwartz and his team, I think you'd be surprised by how he describes his role: it's simple. That's why he can do the job at a young age. Burger King sells a well-known product in a predictable market. They don't invent crazy new things. They operate efficiently and scale operations that work. Facebook pioneers technology and products that the world hasn't seen before. For Facebook to do so well requires a combination of grand vision, operational effectiveness, recruiting and managing ultra-high caliber talent, and more. Burger King isn't an "easy" business to run but it's a well-defined business with a simpler playbook than a company like Facebook. I'm sure BK's investors are great advisors but I suspect the company's success is because of the highly capable team tackling a market with a well defined playbook.
- drum 12y ago
  "They don't invent crazy new things." In the world of fast food, I see this as a problem. Taco Bell released the Dorito Loco Taco which has now made its way on to the main menu. Subway releases new promotional subs and items like the Flatizza, it seems almost bi-monthly. While the latter may not be as big of a success, it still garners awareness. I can't think of one "crazy" item Burger King has released in the last few years.

batbomb 12y ago

I went to Puerto Rico recently and one thing I remember was how strange it seemed to me how much more popular Burger King was versus McDonalds there. I'm not sure if this is a general Latin American (including Miami?) trend, but I just remember it being a little noteworthy. Here's a picture I found of (supposed) market share in Puerto Rico, for example: http://dialog.scarborough.com/wp-content/uploads/2013/05/Puerto-Rico-Burgers-e1369863169485.png http://dialog.scarborough.com/wp-content/uploads/2013/05/Pue...

wcfields 12y ago
Maybe it's because Burger King is more willing to make their items spicy?
chuck8088 12y ago
Basically 1 company owns all the fast food restaurants in Puerto Rico. This company owns 0 McDonalds franchises.

AndrewKemendo 12y ago

>Burger King Is Run by Children I don't think Businessweek could have come up with a more patronizing headline if they had tried to. Kudos to Jorge Paulo Lemann, William Ackman and others who can see value regardless of age.

gdilla 12y ago

More context here: http://www.businessweek.com/articles/2013-08-29/the-brazilian-billionaire-who-controls-your-beer-your-condiments-and-your-whopper http://www.businessweek.com/articles/2013-08-29/the-brazilia... "In two years under Hees the company more than doubled its margins, as measured by Ebitda (earnings before interest, taxes, depreciation, and amortization), Wall Street’s preferred gauge of cash flow. He did this in part by recasting Burger King as an owner of franchises rather than an operator of restaurants and sold off locations owned by the company. This allowed Hees to shove about 28,000 employees off Burger King’s balance sheet. It also meant the company didn’t need to spend as much to refurbish aging restaurants; instead, it offered incentives and lined up loans for franchisees to revamp their locations, replacing dull old plastic countertops with shiny metallic surfaces and futuristic stripes of neon. "

rayiner 12y ago

The Britney Spears reference is silly: she's 32, closing in on what the U.S. census defines as "middle age" (35-55). It's not that unusual. E.g. Jamie Dimon was President of Travelers at 36.

zheshishei 12y ago

"In 2009, Burger King put the $1 Double Cheese Burger on the menu. The item increased sales, which meant Burger King collected more in royalties. But franchisees abhorred it: They couldn’t make money selling a big cheeseburger for a low price. The Burger King franchisee association sued the company to get the burger off the menu. “It was beyond toxic,” says consultant Knapp of the chain’s relationship with its franchisees at the time." I subsisted off the $1 Double Cheeseburger for a year in college. Now I feel rather guilty about it. Oops.

jqm 12y ago

I live in a small town in the South West US. Well over 50% of the town is Latino. There was one BK in town and it closed. For several years there was no BK. Then, a new one was opened around 2 years ago and it was quite the event. For weeks the line stretched for hundreds of feet through the parking lot (they actually had to put up cones to snake it around) and you couldn't get a seat. I personally don't care for BK at all and scratched my head about this. Their food is abominable in my opinion... not to be negative but it just is what it is. It frankly tastes like they put sugar in their hamburger and they probably single handedly use 30% of the mayo consumed in the US. But maybe they have something that appeals to a certain group of people. Apparently they do. The restaurant is still consistently pretty busy. I went once just to find out if they were as awful as I remember and determined they were worse. But in certain demographics they appear to remain popular. No point... I just found all this interesting.

Scoundreller 12y ago

"They talk about the need to instill everybody at Burger King with an “ownership mentality,” meaning mainly that employees should husband the company’s money as if it were their own." I always translate this to: "Share in the losses, and maybe, just maybe, we'll share some of the wins with you, if there's enough after satisfying our insatiable desires"