In 1969, a tech hobbyist moved to Silicon Valley and began tinkering with some projects.
7 years later, he sold his video-game company Atari for $28,000,000 - and was itching to start a restaurant.
This is the story of Nolan Bushnell and Chuck E. Cheese 🧵
7 years later, he sold his video-game company Atari for $28,000,000 - and was itching to start a restaurant.
This is the story of Nolan Bushnell and Chuck E. Cheese 🧵
Bushnell graduated from The University of Utah in the late 1960's.
He worked as an engineer at an electronics company before founding Atari in 1972.
The company saw immediate success as they invented arcade classics still played to this day.
The game 'Pong' was the first hit.
He worked as an engineer at an electronics company before founding Atari in 1972.
The company saw immediate success as they invented arcade classics still played to this day.
The game 'Pong' was the first hit.
In addition to Pong, the company created other popular games such as:
• Asteroids
• Centipede
• Missile Command
For his work at Atari, Bushnell is considered a founding father of what is now the ~$86 billion video-game industry.
• Asteroids
• Centipede
• Missile Command
For his work at Atari, Bushnell is considered a founding father of what is now the ~$86 billion video-game industry.
Oddly enough, in 1975, a former Atari employee by the name of Steve Jobs approached Bushnell about investing in his computer company.
Jobs offered him 33% of the company (i.e. Apple) for just $50,000!
Bushnell declined so he could focus on Atari & a restaurant idea 🤯
Jobs offered him 33% of the company (i.e. Apple) for just $50,000!
Bushnell declined so he could focus on Atari & a restaurant idea 🤯
Bushnell sold Atari to Warner Communications a year later, which personally earned him $15 million.
He then began exploring his restaurant idea within Warner.
The thought was to serve pizza and have Atari arcade games available, so customers could play while they waited.
He then began exploring his restaurant idea within Warner.
The thought was to serve pizza and have Atari arcade games available, so customers could play while they waited.
It was meant to be called Coyote Pizza, but the coyote mascot costume they ordered turned out to be a rat instead.
Bushnell embraced it and Chuck E. Cheese's was born.
Warner had little interest in operating restaurants, so Bushnell purchased the rights to take it on full-time.
Bushnell embraced it and Chuck E. Cheese's was born.
Warner had little interest in operating restaurants, so Bushnell purchased the rights to take it on full-time.
The 1st location was an immediate hit, and eventually Bushnell began franchising the concept.
This led to a fateful deal with Robert Brock, a hotel operator who agreed to open 200 locations.
But Brock cancelled the deal to start his own chain, ShowBiz Pizza Place...
This led to a fateful deal with Robert Brock, a hotel operator who agreed to open 200 locations.
But Brock cancelled the deal to start his own chain, ShowBiz Pizza Place...
The 2 companies competed fiercely in the early-1980's, taking on debt in the name of expansion.
But in 1984, things went south. The video-game industry was in a recession, and stores for both brands were struggling to survive.
Chuck E Cheese broke first and declared bankruptcy.
But in 1984, things went south. The video-game industry was in a recession, and stores for both brands were struggling to survive.
Chuck E Cheese broke first and declared bankruptcy.
ShowBiz weathered the storm somehow, and in a wild twist ended up acquiring Chuck E. Cheese for $35 million.
This marked the end of Bushnell's involvement.
In 1992, the company converted all ShowBiz Pizza Places to Chuck E. Cheese's, as it was clearly the stronger brand.
This marked the end of Bushnell's involvement.
In 1992, the company converted all ShowBiz Pizza Places to Chuck E. Cheese's, as it was clearly the stronger brand.
They grew to 300 locations by 2000, and enjoyed some great years as the go-to birthday party spot for kids nationwide.
But since this golden era, Chuck E. Cheese has struggled once again..
But since this golden era, Chuck E. Cheese has struggled once again..
Sales slumped heading into 2012, leading to:
• Changing the mascot to a rockstar rat 🤔
• A leveraged buyout by Apollo Global in 2014
• A failed reverse-merger and IPO in 2019
• Declaring bankruptcy in June 2020 due to covid
• Changing the mascot to a rockstar rat 🤔
• A leveraged buyout by Apollo Global in 2014
• A failed reverse-merger and IPO in 2019
• Declaring bankruptcy in June 2020 due to covid
Luckily, in early 2021 Chuck E. Cheese completed their restructuring + eliminated $705M of debt.
They've remodeled ~100 of their 612 locations, including adding wifi & replacing the iconic golden tokens with "playpass" cards.
They even started selling frozen pizza in Kroger's!
They've remodeled ~100 of their 612 locations, including adding wifi & replacing the iconic golden tokens with "playpass" cards.
They even started selling frozen pizza in Kroger's!
It remains to be seen how Chuck E. Cheese will progress over the next few years.
As for Nolan Bushnell, he's founded 20+ companies since losing out to ShowBiz Pizza Place.
But Atari and Chuck E. Cheese remain his most noteworthy entrepreneurial accomplishments (by far).
As for Nolan Bushnell, he's founded 20+ companies since losing out to ShowBiz Pizza Place.
But Atari and Chuck E. Cheese remain his most noteworthy entrepreneurial accomplishments (by far).
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And feel free to like & retweet to share this crazy story!
Give me @franchisewolf a follow to catch them in your feed.
And feel free to like & retweet to share this crazy story!
You may also like my 2x/week newsletter that breaks down new franchises:
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Sources:
youtube.com
nrn.com
nrn.com
en.wikipedia.org
#the-coronavirus-pandemic-hit-the-chain-hard-with-sales-sinking-21-in-the-first-quarter-chuck-e-cheese-has-attempted-to-keep-fans-engaged-with-pizza-delivery-and-live-performances-from-the-mascot-14" target="_blank" rel="noopener" onclick="event.stopPropagation()">businessinsider.com
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youtube.com
nrn.com
nrn.com
en.wikipedia.org
#the-coronavirus-pandemic-hit-the-chain-hard-with-sales-sinking-21-in-the-first-quarter-chuck-e-cheese-has-attempted-to-keep-fans-engaged-with-pizza-delivery-and-live-performances-from-the-mascot-14" target="_blank" rel="noopener" onclick="event.stopPropagation()">businessinsider.com
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TL;DR
✅ Nolan Bushnell pioneered the video game industry
✅ He could've owned 33% of Apple
✅ He started Chuck E. Cheese but got acquired by an imitator
✅ The chain enjoyed some good years before falling on hard times again (and declaring bankruptcy in 2020)
✅ Nolan Bushnell pioneered the video game industry
✅ He could've owned 33% of Apple
✅ He started Chuck E. Cheese but got acquired by an imitator
✅ The chain enjoyed some good years before falling on hard times again (and declaring bankruptcy in 2020)
P.S.
In reference to passing on a 33% equity stake in Apple, Bushnell said:
"I was smart, I said no. It's kind of fun to think about that..when I'm not crying"
Brutal 🤣
In reference to passing on a 33% equity stake in Apple, Bushnell said:
"I was smart, I said no. It's kind of fun to think about that..when I'm not crying"
Brutal 🤣
Other random fact:
The original Chuck E. Cheese was intended for parents - it made abrasive comments & had a New Jersey accent.
They transitioned to be more kid-friendly, but here's what the OG sounded like:
The original Chuck E. Cheese was intended for parents - it made abrasive comments & had a New Jersey accent.
They transitioned to be more kid-friendly, but here's what the OG sounded like:
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