The Untold Truth Of Donatos Pizza

You won't find many family-run businesses that can go toe-to-toe with giant corporations. But Donatos Pizza isn't like many family-run businesses. After all, how many small-time restaurant chain owners prove to have better business minds than McDonald's? The people running Donatos arguably have, putting them far ahead of some of their competition.

Donatos Pizza was started by a teenager in 1963 as a single restaurant in Columbus, Ohio. Nearly 60 years later, it boasts more than 160 stores across nine states, making it one of the largest pizza chains in the country, according to Restaurant Business. Along the way, it's made a name for itself by delivering a consistently delicious product. Yet as popular as it has become, even the most diehard Donatos fans likely don't know the franchise's whole story — a lot can happen over the course of six decades.

From its takeover by McDonald's and expansion overseas to the secret behind its pizza dough and the company's appearance on "Undercover Boss," here is the untold truth of Donatos Pizza.

Ohio-native Jim Grote entered the pizza business at the ripe old age of 13, reports Family Business. That's when he ditched his paper route and went to work for a local pizzeria in his hometown of ​​Columbus. It would prove to be an incredibly wise and life-changing decision for the budding restaurateur.

Grote quickly grew infatuated with the business and rose up the ranks to become a store manager when he was a mere 15 years old. The following year, the restaurant's owners offered to sell Grote the business, but the teenager's father insisted that he graduate high school and go on to college. Grote obliged and enrolled at Ohio State University. Then, in his sophomore year, he once again had the opportunity to purchase the restaurant. This time Grote's father was on board and even loaned his son the $1,300 needed to buy the store. And just like that, in 1963, Jim Grote became a business owner at the age of 19. While there were many things about the pizzeria he would ultimately change, Grote did hold on to the restaurant's name: Donatos.

When Jim Grote purchased the original Donatos restaurant in 1963, he chose to keep the business' name. The decision was less of a business strategy and more of a business philosophy. "Donatos" is a Latin phrase that roughly translates to ​​"to give a good thing," according to the restaurant. 

The saying resonated with Grote, who had learned the value of giving a good thing years earlier. While working at Donatos as a teen, he noticed one of the owners was always more generous with pizza toppings than the other. "The one that made good pizza and wasn't stingy with toppings, his nights were busier than the other guy's, who watered down sauces and stretched toppings," Grote told Family Business.

From the moment Grote took over Donatos, he was adamant about serving the highest-quality product. In the decades since, "to give a good thing" has been applied to other areas of the business beyond the kitchen. The company has an extensive philanthropic history, particularly when it comes to helping organizations in its home state of Ohio. It also established the ​​Donatos Family Promise Fund to support employees at any level in need of financial assistance.

It can be difficult to sort through the country's crowded field of pizza chains, but Donatos stands out thanks to its Columbus-style pizza pie. You might be familiar with New York- and Chicago-style, but the small, Midwestern city's take on pizza is a very real and unique thing. Columbus-style pizza has three defining characteristics: a thin crust, edge-to-edge toppings, and square slices (via Experience Columbus).

Every Donatos pie has a thin crust and is cut into squares instead of triangles, but the company pays extra attention to the toppings. The restaurant promises every pie will be "loaded" with toppings, including exactly 100 pepperoni slices on every pepperoni pie. Donatos takes toppings so seriously it trademarked the phrase "Edge to Edge."

The chain may be responsible for introducing Columbus-style to the rest of the country, but credit for this take on pizza belongs elsewhere. According to Slice, Columbus-style pizza was the brainchild of Romeo Siri and brothers Dan and Jim Massucci. It was first served at their eatery, Romeo's Italian Restaurant, in 1949. Soon after, the Massucci brothers opened Massey's, Columbus' first pizzeria, which is still in operation today.

Most restaurants are thrilled at the prospect of franchising, as there are few faster ways to grow a business. But for Donatos founder Jim Grote, the almighty dollar never came before the almighty pizza. From the start, Grote was obsessed not just with making the best pizza but with making it consistently. "When a person comes in, they get a pizza and they like it," Grote told Family Business. "When they come back, they expect to have the same good pizza."

Maintaining this consistency at one restaurant can be difficult enough, but maintaining it across numerous restaurants is a daunting challenge. Because of this, Donatos grew slowly despite its successes (via Funding Universe). After 25 years, the company had approximately a dozen restaurants, but they were all family-owned and located in the Columbus area. It wasn't until the early 1990s that Grote and Donatos felt comfortable enough with their processes to begin franchising.

In 1991, the first Donatos franchise opened in Zanesville, Ohio and the expansion process was off and running (via Donatos). By the end of 1992, Donatos had 30 stores in operation, according to Funding Universe. The following year, it had 41.

Donatos founder Jim Grote refused to expand his business outside of Columbus, Ohio until he could ensure the product remained consistent when it was made elsewhere. The major impetus was finding a way to get the perfect pizza dough to each location. According to Funding Universe, Grote had found that to make consistent pizza dough, restaurants couldn't simply follow the same recipe. Instead, all the dough had to be made at once, then delivered to separate locations.

The company had been utilizing a commissary where it rolled out the dough and stored it before sending it to the local outposts. But if Donatos was to expand, it would need to upgrade its dough-making operations in both scale and scope. So, in 1991, the company opened its world-class Dough Innovation Center in Ohio. This development allowed Donatos to begin franchising, which it did the same year. The model has worked and remains in place today.

When Donatos felt Pizza Hut encroaching on its legally protected domain, it didn't sit idly by. Donatos is famous for its Columbus-style pizza, which has toppings on every square inch of the pie. The company is so well known for this feature that in 1988, it trademarked the phrase "Edge to Edge." 

But in 1997, Pizza Hut introduced its crustless pizza, which it called "The Edge." Needless to say, this name didn't go over well with Donatos. The smaller pizza chain filed a temporary restraining order, reports Columbus Business First. This was granted, preventing Pizza Hut from selling the product in markets where Donatos operates.

The two chains later came to an agreement that reportedly involved a cash settlement, according to Columbus Business First. But that wasn't the end of the story. Pizza Hut launched an ad campaign the following year that specifically reminded customers that the Edge isn't served at Donatos. The plan may have backfired, as it gave the much-smaller Donatos some of the limelight. "I find it interesting the largest pizza chain in the world is spending ad dollars talking about a 120-store chain out of Columbus," Donatos marketing executive Tom Santer said at the time. "I hope they keep it up; we need all the help we can get."

By 1999, Donatos had grown into a $120-million business with more than 140 stores. Its growth was so impressive that it caught the eye of none other than McDonald's. The Golden Arches had previously purchased a minority stake in Chipotle in an attempt to diversify and was looking to get into other restaurant games. According to Family Business, McDonald's had scoured the country looking for the chain with the best pizza and most repeatable processes. It landed on Donatos.

Only, founder Jim Grote didn't want to sell. "Are you kidding? That's my baby. We're not selling our place," Grote recalled thinking. But Grote knew that the hamburger behemoth could help expand Donatos. Ultimately, he grew convinced the business would be in good hands and agreed to sell while remaining in charge of the day-to-day operations.

But Donatos didn't shoot to global success under McDonald's. In fact, the brand struggled so much that McDonald's put it up for sale just four years later. Seeing an opportunity, Grote and his family purchased Donatos back and immediately righted the ship. According to the family, the business made $10 million more in the first year after leaving McDonald's than it had the year before.

Though Grote was reluctant to sell his businesses, his long-term dream was to sell Donatos pizza around the world, a goal that a fast food giant like McDonald's could make happen. So in 1999, the Grote family handed over the keys and McDonald's went to work trying to turn the company into a global brand (via Family Business).

The first stop was Germany. In the fall of 2002, Donatos opened its first international store in Munich, followed quickly by two more locations in the country. Tom Krouse, then-senior vice president of marketing at Donatos, said the company focused on Germany because the pizza market there, "is pretty fractured and is pretty low on the quality end."

But the McDonald's experiment never worked out for Donatos. The same year that it expanded into Germany, the pizza chain lost millions of dollars, according to the Chicago Tribune. The situation got so bad that McDonald's sold Donatos back to Grote. The three German stores, which were operated by an arm of McDonald's Deutschland called Donatos Deutschland, were shuttered after the sale.

Those who have never stepped foot inside a Donatos restaurant may still be familiar with the chain thanks to its appearance on national television. In 2013, Donatos chairwoman Jane Grote Abell donned a disguise and worked alongside the restaurant's employees on an episode of the Emmy-winning show "Undercover Boss" (via RestaurantNews.com).

Per The Lantern, the experience got off to a rocky start when one store manager recognized Grote Abell right away. Things took a more serious turn for the worse when a Donatos delivery driver confided in Grote Abell, or "Cathy" as she was going by, that he occasionally smoked marijuana while out on deliveries.

Fortunately for Donatos and Grote Abell, these proved to be the only major hiccups during her undercover stint. By and large, the workers Abell shadowed proved to be exemplary employees and people. "I was so proud and overjoyed to discover such strong dedication to the Donatos mission of promoting goodwill and serving the best pizza," Grote Abell said afterward (via RestaurantNews.com). "I expected to gain business insights so that Donatos could better serve pizza lovers; never in my wildest dreams did I think this opportunity would lead me to find real heroes whose commitment to serving our customers would truly inspire me as much as it did."

Donatos has always been loyal to its hometown of Columbus, Ohio, and nothing brings a community together like cheering on local sports teams. So it only makes sense for Donatos to partner with some of Ohio's teams.

The pizza chain has been a longtime partner of Ohio State University, which is a perfect fit for both the higher education institution and restaurant. Not only is the university also located in Columbus, but it's also where Donatos founder, Jim Grote, and his daughter, executive chairwoman of the board Jane, both went to school. Donatos' biggest presence on campus is at the school's football stadium, where it has been selling pizza at concession stands for years, according to Columbus Business First. If there's not a game on the schedule, don't fret — there's always the Donatos restaurant located right on campus.

In 2021, Donatos expanded its roster of sports partnerships by agreeing to become the "Official Pizza" of Major League Soccer's Columbus Crew SC. With the agreement, Donatos products are now sold at all Crew home matches. "By partnering with Donatos we bring together two organizations committed to our city and committed to delivering a world-class customer and fan experience," Crew SC executive vice president and chief business officer Steve Lyons said in the announcement.

In 2018, burger chain Red Robin was looking to expand its menu amid declining sales. It decided to retry an earlier idea: pizza. After years of research, it found an ideal partner in Donatos (via Nation's Restaurant News).

But Donatos was reluctant to join forces with another company. Having witnessed their business take a downturn while under the control of McDonald's, Donatos was apprehensive to hand over their product to someone else again. "They were understandably cautious about it when I first approached them," then-Red Robin CEO Denny Marie Post told Nation's Restaurant News. According to Donatos CEO Tom Krouse, "Having another company take control of our product is not something we take lightly."

But going in Red Robin's favor was perfect timing. The pizza chain was in the midst of brainstorming ideas to expand its footprint, and this partnership proved to be just the solution. In 2018, Red Robin began serving Donatos pizza at four stores. The concept brought in good early returns and began to expand. In June 2021, the burger chain announced plans to add Donatos to 120 more stores, according to Restaurant Business. That would put pizza on the menu of more than 200 Red Robin restaurants. Red Robin expects to generate $60 million in annual pizza sales by 2023, including more than $25 million in profit.

Donatos Pizza offers catering, but according to the company's menu planner, a single restaurant typically caters meals for groups ranging from 15 to 50 people. So when an order for 12,000 people came in March 2020, it was clear the chain was in uncharted territory.

According to 10 WBNS, the request was from the Kroger supermarket chain, which wanted to feed the 12,000 employees of their 68 central Ohio grocery stores as a "thank you" for their hard work during the COVID-19 pandemic. "These women and men have been tirelessly stocking shelves, providing service, and keeping their stores clean so that our communities can have the food and other household necessities they need during these challenging days," Donatos wrote on Facebook.

No doubt a worthy cause, but there was still the issue of making enough pizza for 12,000 people. In order to conquer this tall task, 62 different Donatos restaurants combined their efforts to cook what was likely a previously unfathomable amount of pizza. According to the company, it was the largest single order in Donatos' 57 years of operation.

Since its inception more than a half-century ago, Donatos has been a family affair. Founder Jim Grote lived in a house directly behind the original restaurant and all four of his children worked for the business from the time they were kids (via Family Business).

Grote stayed involved in the business after it was purchased by McDonald's. So did his daughter, Jane Grote Abell. But, four years after McDonald's had purchased the pizza company, it was struggling and McDonald's stock was plummeting. It was Jane who persuaded her father to buy back their business. "I didn't know if I really wanted to do it again," Grote told Family Business. "[But Jane] made it happen with her excitement."

Since then, not only has the business expanded, so have the number of family members. Tom Krouse, the company's CEO who originally joined Donatos while it was under McDonald's leadership, is married to Abell. In late 2019, Abell's son Tony Capuano joined the business as well, serving as executive director of innovation. "I can't tell you the satisfaction that it is to not only have your daughter and grandson come in, but to come in with the same beliefs and principles that you do," Grote told Columbus CEO. "As you go through the chapters of your life, it makes you say 'Gee, this could carry on.' "

The COVID-19 pandemic wreaked havoc on the restaurant industry, forcing chains to shut down stores left and right, sometimes for good. Donatos, however, didn't just stay afloat during the pandemic. It thrived.

According to QSR, from April to September 2020, Donatos opened seven new restaurants in several states, including Ohio, Kentucky, Indiana, and Florida. "As the COVID-19 pandemic continues to challenge businesses in many ways, we've been able to do extraordinarily well considering the circumstances," said Jeff Baldwin, Donatos vice president of development and franchising. "We're ecstatic about this surge in growth and continued success in attracting new franchise partners."

In addition to more stores, Donatos welcomed a wave of new diners. In December of last year, CEO Tom Krouse said 1.5 million new customers had placed at least one order with Donatos since March and more than 100,000 new members had joined the Donatos Pizza Love Rewards loyalty program (via Franchising.com).To support this expansive growth, early in 2021, Donatos even announced a company-wide goal of hiring 2,500 new employees.