On this episode of Run the Numbers, CJ breaks down Jersey Mike’s S-1 and the franchise machine behind more than $4 billion in sandwich sales. He explains how an asset-light royalty model works, why franchise economics can be so powerful, what Blackstone saw in the business, and what the filing reveals about growth, margins, and the real money behind the subs.
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LINKS:
Mostly Talent: https://mostlymetrics.typeform.com/to/cLTxtAsN
CJ: https://www.linkedin.com/in/cj-gustafson-13140948/
Mostly metrics: https://www.mostlymetrics.com
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TIMESTAMPS:
0:00 Sell $4B in subs, own none of the stores
0:33 Origin story: Peter Cancro buys a sub shop at 17
1:47 It's a royalty business
2:42 Key metrics
6:07 What you're actually buying
6:42 The three revenue streams
7:19 The franchisee's P&L
10:00 Sponsors — RightRev | Pulley | Rillet
13:02 Corporate P&L: 47% EBITDA margins
13:33 The Blackstone math
14:38 $2.1B whole business securitization
15:09 Full EBITDA bridge
16:00 The CEO buying back the 2%
17:10 Red flag 1: Up-C structure
18:11 Red flag 2: tax receivable agreement
18:45 Red flag 3: controlled company governance
19:05 Red flag 4: sponsor already took $500M
19:29 Red flag 5: charitable donations added back
20:13 Red flag 6: cheap debt maturing in 2029
20:52 Sponsors — Maximor | Brex | Anrok
23:56 Valuation: $10–12B
24:32 Peer comparison
25:27 How do you underwrite $12B?
25:58 Misc: quantum attack on the provolone
26:28 The hidden 53rd week
26:57 No drive-thru is a feature
27:13 Verdict
27:56 Credits
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