Fred DeLuca Net Worth

What Was Fred DeLuca's Net Worth?

Fred DeLuca was an American businessman who had a net worth of $2.8 billion at the time of his death in 2015. Fred DeLuca was best known as the co-founder of Subway, one of the most successful fast food franchises on the planet. DeLuca launched Subway in 1965, when he was just 17 years old, with the help of a small loan from family friend Peter Buck. By 1987, the sandwich stand had expanded into a chain with 1,000 locations. As a point of comparison, consider that by that time, fast food giant McDonald's only had 800 locations. Now, Subway is one of the most popular fast food restaurants in the world, thanks to memorable advertising campaigns such as "the Subway diet" espoused by Jared Fogle and "five-dollar footlongs." As of this writing, there are approximately 37,000 Subway locations worldwide, and the company reported a revenue of $16.1 billion in 2019. DeLuca and Buck also teamed up to form Franchise Brands, which "focused on working with franchisors to develop and expand their brands." Fred published the book "Start Small, Finish Big: 15 Key Lessons to Start–And Run–Your Own Successful Business" in 2000, and he appeared on the CBS reality series "Undercover Boss" in 2010. DeLuca died of leukemia on September 14, 2015, at the age of 67.

Early Life

Fred DeLuca was born Frederick James Matthew DeLuca on October 3, 1947, in New York City. He was the son of Salvatore and Carmela DeLuca, and he had a younger sister named Suzanne. When Fred was 10 years old, his family relocated to Amsterdam, New York, where they befriended Peter Buck, not to be confused with the musician from the band REM who is also named Peter Buck. When DeLuca was a teenager, the family moved to Bridgeport, Connecticut. Fred attended Central High School, and after graduating in 1965, he earned a degree from the University of Bridgeport.

Subway

In 1965, Fred borrowed $1,000 from Peter Buck after Buck suggested that DeLuca open a sandwich shop to help him raise money to pay for college. Fred, who was 17 years old at the time, came up with the idea for a "fast-food venture that provided a healthful, less fattening bill of fare," and he soon opened Pete's Drive-In: Super Submarines in Bridgeport. The name was later changed to Pete's Submarines, then Pete's Subway before being shortened to Subway in 1968. A year after opening the restaurant, a second location was added, and in 1974, the first franchise location opened in Wallingford, Connecticut. DeLuca's mother ran the first Subway restaurant, his sister worked there as a "sandwich artist," and his wife took a job in the corporate office. The 100th Subway location opened in 1978, and less than a decade later, it hit the milestone of 1,000 restaurants. In 1993, Subway opened 1,100 locations. In late 2010, Subway became the world's largest fast food chain, with 33,749 locations.

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In the mid-1990s, Nicholas and Victoria Jannotta, landlords who owned a building that was a former Subway location, filed a lawsuit against Subway Sandwich Shops, DeLuca, Buck, and Doctor's Associates Inc., alleging lease and contract violations. The Jannottas claimed that DeLuca, Buck, and Doctor's Associates Inc. (Subway Sandwich Shops' leasing company) had "misrepresented the asset value of Subway Sandwich Shops" during negotiations of a 1985 lease agreement. An Illinois jury ruled in favor of the plaintiffs and ordered DeLuca, Buck, and Doctor's Associates Inc. to each pay $3 million in punitive damages.

After he read an article about an man named Jared Fogle, who lost nearly 250 pounds eating Subway sandwiches, Fred met with Fogle, bought him a car, and hired him to be the chain's spokesman in 2000. While Fogle was Subway's spokesman, store openings and sales skyrocketed. By 2015, Cindy Mills, a Subway franchisee whistleblower, informed high-ranking executives at Subway that Fogle was a pedophile and had engaged in illicit sexual activity. The company released a statement denying any knowledge of its spokesman's pedophilia and stated that DeLuca and other executives didn't know that Fogle had engaged in underage prostitution. Fogle was arrested in July 2015, and the same day, Subway announced that Fogle and the company had "mutually agreed to suspend their relationship due to the current investigation." By the end of the day, all references to Fogle had been removed from the Subway website. Fogle was later sentenced to more than 15 years in prison.

Personal Life

Fred married his high school sweetheart, Elisabeth, in 1969. Their son Jonathan is a member of Subway's board of directors. DeLuca reportedly adopted a child, Luca, with his former girlfriend Cindy Mattson, and after his death, Mattson sued his estate, claiming that Fred had promised Cindy and Luca $20 million. According to a 2022 Mashed.com article, DeLuca never signed adoption papers, and Elisabeth and Jonathan originally denied Cindy's claim, but Mattson later "filed a document stating she had received full payment or otherwise settled the claim."

Death and Legacy

In July 2013, Subway released a statement announcing that DeLuca was undergoing treatment for leukemia. Fred died of the disease on September 14, 2015, at the age of 67. A few months before his death, his sister Suzanne was put in charge of Subway's day-to-day operations. DeLuca passed away just weeks after Subway's 50th anniversary. While Fred was in charge of the company, it grew to be world's largest fast food franchise. Though the chain suffered a net loss of thousands of locations in the U.S. in the years after DeLuca's death, Subway is still the world's largest sandwich chain.

Honors

In 2002, Fred received an honorary Doctor of Humane Letters from the University of Bridgeport, his alma mater. In 2015, the Connecticut Restaurant Association honored DeLuca with a posthumous Lifetime Achievement Award.