At just 17 years old, Peter Cancro purchased a sandwich shop for $125,000. The young entrepreneur decided to rename it Jersey Mike’s. Now, Cancro has sold the massive sandwich business for $8 billion.
Cancro initially bought what would soon become Jersey Mikes with a $125,000 loan from his high school football coach. At the time, the soon-to-be sandwich executive hadn’t even reached the legal age to slice cold cuts at the sandwich joint in Point Pleasant, New Jersey (NJ). He would rename this sandwich joint Jersey Mike’s Subs, not knowing that his billionaire status would be set in stone decades later.
Peter Cancro’s Billion-Dollar Decision With Blackstone
On Tuesday, November 19, 2024, the private equity entity known as Blackstone announced that it had reached an agreement to purchase a significant portion of Cancro’s sandwich company. The deal ultimately valued Jersey Mike’s Subs at about $8 billion, including debt. This agreement bumped Cancro’s net worth up to an estimated $7.5 billion, as reported by Bloomberg.
However, in 1975, Cancro was merely a senior in high school with no interest or experience in business development or management before he bought the NJ sandwich spot. His original goals were to pursue a career in political science and law at the University of North Carolina at Chapel Hill. It wasn’t until his mother suggested he buy the business he’d been serving at since he was just 14 years old that he realized his dream.
Cancro told Forbes that his reflex response was to laugh at her proposal. However, after thinking about it for a bit, he had a lightbulb moment that led him to contact the restaurant the next day. The sandwich shop manager informed Cancro that the business would be his if he could find $125,000 in one week. At 67, Cancro realizes that “it was something [he] really wanted to do.” He credits his young age and unwavering optimism for his inability to imagine failing at such an endeavor.
By the end of that week, he had secured a loan from his former football coach, who also happened to be a banker. Back then, $125,000 would be worth nearly $750,000 in today’s money. Cancro became the sole owner of the sandwich spot before graduating high school.
The Worldwide Reach of Jersey Mike’s
It’s been nearly five decades since the sandwich company’s inception. The chain has just under 3,000 shops worldwide. In 2023, the business garnered $3.3 billion in sales. According to Technomic, a food service consulting firm, Cancro’s sandwich joint chain has grown by an average of around 20% since 2019.
Throughout Jersey Mike’s Subs’s development, Cancro says he often “put everything on the table.” As a result, the company’s impressive growth didn’t come without a few hurdles along the way. In 1991, just four years after Jersey Mike’s dipped into franchising practices, the business wrestled with securing the proper cash to pay the bills. This struggle occurred due to a series of banking failures in the Northeast. Cancro explained that he ultimately had to let go of his corporate staff, which unfortunately included his own brother.
Cancro regards 1991 as his “toughest recession, even beyond 2008.” He added that he originally believed taking the business public or selling some of his stake might mend the issues, but he decided not to go that route. In 1994, the predicament began to improve, and he successfully expanded the sandwich chain to North Carolina shortly after.
The Rollercoaster Ride Before Jersey Mike’s Triumph
Throughout the ups and downs, Jersey Mike’s began to fade in 2006 due to the dot-com bubble burst and market crash in 2002. Simultaneously, Cancro’s existing shops started to age, leading him to take on risky upgrades. The payment for retrofits was around $15 million total, which Cancro notes “was all the money in the world back then.”
By 2007, Cancro said the company victoriously returned to an upward trajectory due to his decisions.
The Future of Jersey Mike’s Subs Under Blackstone
Blackstone told Forbes they are “still in the early innings of Jersey Mike’s growth.” Only 1% of the people who apply to own a franchise receive approval. Opening any storefront could cost you as little as $200,000 and as much as $1.3 million. However, the returns could be worth it over time.
With most of Jersey Mike’s Subs now belonging to Blackstone, Cancro is expected to retain a small yet “significant” equity stake. He will continue to lead the company as CEO after Blackstone’s acquisition is complete sometime in early 2025.
Blackstone adds Jersey Mike’s Subs to its portfolio, which boasts Hilton Hotels and Tropical Smoothie Café franchisors. On a final note, the private equity giant expects major developments for the sandwich shop chain in the years to come.
