Harry J. Sonneborn

From Wikipedia, the free encyclopedia

This article needs additional citations for verification. Please help improve this article by adding reliable references. Unsourced material may be challenged and removed. (July 2007)

This article does not cite any references or sources. (November 2006) Please help improve this article by adding citations to reliable sources. Unverifiable material may be challenged and removed.

Harry J. Sonneborn was the financial wizard behind The McDonald's Hamburger Empire. The adopted son of German Jewish immigrants, he was raised in New York. His marriage to his first wife, June, produced a son and a daughter. After a messy divorce, Sonneborn married his second wife Aloyis Keister, who remained devoted to him until his death in 1993, due to complications from diabetes.

A former vice president of finances at Tastee Freeze, Sonneborn approached Ray Kroc with a revolutionary new financial idea for franchising in 1955. Sonneborn quickly rose to the top serving as McDonald's president until he resigned in 1967 due to a dispute with Kroc; who had the "last word" as the company’s CEO. Convinced that Kroc was leading the company into trouble, Sonneborn sold his sizable block of McDonald's stock for three million dollars and left the company. Selling off his stock was one of the few financial mistakes he ever made as McDonald's stock split three ways over the next decade. Had Sonneborn waited to sell, he would have made over one hundred million by 1977, and by the time of his death in 1993, his stock would have been worth a cool billion. He ultimately made up for his underestimation of McDonald’s future under Kroc, but his bruised ego never quite recovered. Sonneborn refused to ever eat at a McDonald’s again, and stuck to his guns until the day he died.

After leaving McDonald’s, Sonneborn continued to be heavily involved in the business world through the stock market, capital investments, and banking. He and his wife Aloyis founded several philanthropic foundations, and were to a great extent involved in charitable organizations and fundraisers. During his final years, Harry J. Sonneborn devoted himself to entertaining close friends, travel, and his hobby of photography. He was posthumously vindicated by Ray Kroc several years after his death, and just months before Kroc himself died.:

In the book, McDonald’s: Behind the Arches, Love (1995) the secret was revealed:
“What converted McDonald’s into a money machine had nothing to do with Ray Kroc,
or the McDonald brothers, or even the popularity of McDonald’s hamburgers, french fries,
and milk shakes. It was Harry J. Sonneborn.”

“McDonald’s real moneymaking engine was its little-known real estate business, Franchise Realty Corporation; envisioned and created by Harry Sonneborn. The obscure McDonald’s alter ego company was based on Sonneborn’s unique even lesser known financial formula.”

Just months before Ray Kroc died, he commented (Love, 1995): “Harry alone put in the policy that salvaged this company and made it a big-leaguer. His idea is what made McDonald’s rich.”