Fact Checking The Founder – Ray & Joan (2024)

The late philanthropist Joan Kroc accomplished much during her 12-year courtship and subsequent 15-year marriage to Ray Kroc, the founding chairman of the McDonald’s Corporation. One thing she did not do, however, was convince her second husband to deploy milkshake mix in place of real ice cream in the stores.

That’s the pivotal plot point in the “The Founder,” a film that purports to tell the true story of the controversial corporation that defined fast food and forever changed the way the world ate. Not since musician Mark Knopfler immortalized the irascible CEO in his 2004 song “Boom Like That” has the early beginnings of the company been depicted in popular culture. Such moments are notable, given McDonald’s notorious resistance to outside scrutiny. (Just try, as an independent researcher unaffiliated with the company, to gain access to the voluminous corporate archives.) The only existing history of McDonald’s was composed under the watchful eye of its executives, way back in 1986.

The story of how Kroc morphed an idea sprouted in the California desert into an international franchising empire is studied in business schools around the world even today, though it’s most typically told through the lens of unchallenged mythology. But rather than setting the record straight, “The Founder” plays fast and loose with the facts, leaving an erroneous impression about the mechanics of the deal, as well as about Ray’s formidable and largely unsung third wife, Joan. (Scroll down for the fact-check.)

Joan was, indeed, married to a man named Rollie Smith when she collided with Kroc in 1957 in St. Paul, Minnesota. Rollie didn’t own a restaurant; he was a Navy veteran working as a fireman on the Milwaukee Road railroad. Kroc, aformer paper cup and milkshake machine salesman, was himselfmarried, andpeddling franchises around the mid-west on behalf of brothers Dick and Mac McDonald. Their hamburger stand in San Bernardino, one of countless such operations on the emerging byways of post-War America, had emerged as a runaway success because of their spare menu and well-choreographed “Speedee” system of service they’d artfully charted out on a tennis court.

Then 28, Joan serenaded diners on a Hammond organ in an upscale restaurant in St. Paul called the Criterion, one of three jobs she juggled to make the family’s ends meet. Ray, himself a pianist, was smitten by her musical proficiency, not to mention her striking good looks. Soon, Joan’s employer, Jim Zien, was buying in to the fast-food game, and, not coincidentally, hiring Joan’s husband to manage his McDonald’s outpost in nearby St. Louis Park, Minnesota—store number 93.

With a bonus Rollie earned for his hard work, he, Joan and their daughter decamped to Rapid City in 1959 to open the first outpost of the fast food chain in South Dakota. Wives were the only women allowed then to work at the hamburger stands. (Unpaid, of course—and out of sight.) From the back office, she dutifully placed orders to local suppliers for potatoes and such, helping to launch her husband as a successful franchisee.

Meanwhile, drama was brewing between Kroc and the inventors of the system he was propagating across the land. The corporation was bleeding money as the ambitious salesman added staff to expand the empire and police stores for consistency. Back home at the original outpost, Dick and Mac were collecting sweet, passive income for their idea: of the 1.9% royalty collected from franchisees, they received .5%. More concerned with keeping parking lots tidy than with the tedious chore of balancing the books, Kroc struggled to pay his own bills, as well as those of the company’s, even after his chief ally, financial mastermind Harry Sonneborn, cooked up the real estate formula that eventually righted the unstable ship.

The film depicts Joan’s purring insistence that Kroc switch from ice cream to milkshake mix to save franchisees on pricey refrigeration, and that his acceptance of this convenience product precipitated the breakup with Dick and Mac. Kroc most certainly needed Joan, but not in this capacity. Such a product was one with which he was well-acquainted from his days as a salesman of revolutionary multi-spindled milkshake machines. (During World War II and the era of sugar rations, he’d made do by selling Malt-A-Plenty, a powder made from corn syrup first used in 1938.)

The break-up of the brothers from Kroc had nothing to do with frosty treats, but rather their chilly relations. Kroc needed to extricate himself from his ironclad agreement with Dick and Mac in order to raise capital and continue to grow. In 1961–the same year he divorced his first wife, Ethel–he asked the founders of McDonald’sto name their price to go away. Tired of his temper and bossy bluster, they were in the throes of planning an encore: A chain of coast-to-coast motels they intended to call, in honor of their heritage, “A Wee Bit of Scotland.” After mulling it over for a short while, the men who invented McDonald’s delivered the price to sell their creation to the man who ran with the idea: $2.7 million.

A panicked, cash-poor Kroc asked if he might pay down this grand sum in installments, over time. Dick McDonald’s answer: “If it’s not cash, we might as well continue with the royalty.”

Sonneborn managed toraise the necessary money for the buy-out, though, poising the company for its blockbuster stock market debut in 1965. Even then, no one could have imagined the eventual, phenomenal growth of the chain.

Neither brother ever appeared to lamentthe financial terms of the deal. “You won’t have to hold a tag sale for us,” Dick said in one interview. (Mac died in 1971.) “I have no regrets,” he said in another. He told a reporter for the Wall Street Journal in 1991 he’d never calculated what the continued royalty would have made him. He proudly showed off a copy of the payout check to visitors.

He did, however, angrily push for recognition. For a time, the fact that real men with the name McDonald actually existedwas craftily avoided in corporate lore. That wasn’t Kroc’s doing; it was the PR machine behind the company that amped it up, particularly afterKroc died in 1984.

As for Joan, after some dramatic detours, she became Ray’s wife in 1969. Her biggest contribution to his life had to do with another liquid beverage: Early Times whiskey, and his affinity for it. She became an innovative pioneer in the modern alcoholism addiction movement; an early proponent and funder of hospice; the first individual to give a million dollar gift to the Democrats; and a passionate, active supporter of the no-nukes movement. Her posthumous $235 million gift to NPR is credited with putting the network on sound financial footing, and her $2 billion gift to the Salvation Army created several dozen world-class recreation facilities in poor neighborhoods around the country. She never forgot the roots of her fortune, though. Around the fancy neighborhood of Rancho Santa Fe where she made her last home, she was known to drive through the McDonald’s to pick up a snack, sometimes forgetting her purse, other times offering $100 tips.