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From East Side Mario's, Fionn MacCool's and Bier Markt to Swiss Chalet, and The Keg, millions of Canadians have celebrated their special moments in John Rothschild’s world.
Graduating as one of the youngest MBA students in 1983, John Rothschild didn’t take the obvious entrepreneurial path. He built his career as an accountant, and then an investment banker who soon discovered how much he enjoyed working with small owner-operator businesses. From there, it was a small step to becoming an owner-operator himself, as the founder of Prime Restaurants.
In this episode, long-time friend and ally of entrepreneurship, John Rothschild shares his love for business, food and celebrating good times.
The Entrepreneur Podcast is sponsored by Connie Clerici, QS ’08, and Closing the Gap Healthcare Group, Inc.
Transcript
You're listening to the Entrepreneur Podcast from Western University's Morrissette Institute for Entrepreneurship, powered by Ivey.
In this series, join me, Eric Morse, as we uncover the stories of our entrepreneurial legends. These Western Founders have revolutionized industries, build recognizable brands, and added richness to lives across Canada and beyond. Discover their origins, their greatest moments, their deepest challenges, and what makes each of them tick.
Welcome to The Legend Series.
From Eastside Mario's, Fionn McCool's and Bier Markt to Swiss Chalet and the Keg, millions of Canadians have celebrated their special moments in John Rothschild's world. Graduating as one of the youngest MBA students in 1983, John Rothschild, didn't take the obvious entrepreneurial path. He built his career as an accountant and then as an investment banker, who soon discovered how much he enjoyed working with small owner operated businesses. From there, it was a small step to becoming an owner operator himself as the founder of Prime Restaurants. In this episode, longtime friend and ally of entrepreneurship, John Rothschild, shares his love for business food, and celebrating good times. John, it's a delight to be with you this afternoon. Really, thank you for joining us for the legends podcast. And I know you don't like that moniker, but I think it's one that that fits you well. But my first question is really about, you know, in your youth, did you ever think that you would be an entrepreneur?
John Rothschild
You know, what, Eric? That's a? That's a great question. Because the answer is I always thought I wanted to run something.
Eric Morse
Okay.
John Rothschild
But I really didn't know the route to get there. So yeah, I thought I want to run something. I guess the idea of becoming entrepreneur, I didn't know it had a label.
Eric Morse
So I guess maybe? Looking to run something. And I yeah, I understand. I understand that. But you went off to business school and in some ways took a traditional pathway, I think for Ivey students in any case. You went with a private investing firm. You know, how did that go? And when did you decide it was time for something else?
John Rothschild
My path was not an obvious path, perhaps. I graduated, as you said, with my MBA, probably the best move I ever made in terms of schooling, for sure was the launching the MBA. I came out as one of the youngest MBAs to graduate... felt that I had this very high level degree, an MBA, for strategy and seeing all of the ways of putting a company together. But I didn't have a grassroots foundation and then I went and joined Price Waterhouse and did my chartered accounting degree with them, my CA. I set up my own accounting firm afterwards, I guess I had a bit of an entrepreneurial orientation, even then, and then was approached by a client who convinced me that I should go into the investment banking business that didn't need much convincing. It was there in the investment in the investment business that I saw... Or had, the yen, let me put it this way, I had the yen to get involved in smaller businesses. I liked working with owner operators, I liked the hands on approach. And then I guess I had a bit of an epiphany that I wanted to be, instead of being with owner operators, I wanted to be an owner operator. And I took my shot at it through one of the investments that the investment company I had mentioned.
Eric Morse
Okay, so now so your path was a little different than I thought, do we say accounting first? And then you went to the investment banking route. Why why this, you know, jumping off with a with a food... with a restaurant business? What was it that, you know, kind of excited you about that?
John Rothschild
It's a bit of a tough question to answer in that. You think you you, you ask it from the perspective that I made an overt choice. Business, it's not the case. It was a business that through the investment company we had invested in. It was one that I had recommended we invest in it looked very promising. I found that the investment, the people that I had invested in had let me down, and I felt kind of betrayed to put it bluntly. And it was then that I got the combination of betrayal. I can do a better job that I disappointed I called my handlers at the investment company. And it's time for me to no longer be a coach, but to be a player. So it was the coming together of all of those things. It didn't necessarily need to be a restaurant business, it could have been almost any business. I feel very fortunate it was the restaurant business because it is an exciting business; if you like people, it's a great business. And I like people. And I liked being involved in a fast moving, dynamic business that I thought I could grow. So it's great.
Eric Morse
So that's interesting, John, so you know, you hear so much talk about passion. But your passion wasn't necessarily for the restaurant, it was for business in itself. And can I make a go of this? And you saw the challenge in it, I suppose.
John Rothschild
Yeah, that's true. It was more of an intellectual or perhaps an opportunity to apply all of the fundamentals that I had learned both at Ivey and my years at Price Waterhouse, and my years at the investment firm. And so it was kind of putting it all together and putting it into action, seeing whether I could actually walk the walk as well as talk the talk. Once it got into the restaurant business. It was more than was so much more than just a fundamental or a academic exercise. I love the people that I met, they were so different and so interesting. And yeah, I quickly fell in love with the restaurant business, and the people and the pace and... where can you make a decision in the morning, implemented in the afternoon, and know quickly what the results are like the restaurant business? So it was to me it's hard to be involved in a business that's combined business fundamentals and, and passion; food. I mean, feeding. It's it's hard to stay neutral, and it's very easy to get, get passionate and involved.
Eric Morse
Yeah, so became passionate about a particular industry. What did the business look like when you started John? Eastside Mario's was it bigger than that? How many restaurants were there?
John Rothschild
The business was really quite small, and failing. And it was before Eastside Mario's really had started to shine. It consisted of a couple of concepts that were not towing their weight and, and needed to be changed. So I had a ton of cleaning up work to be done. Once the cleanup was done, I found that we had this Eastside Mario's concept, and it was fabulous. And I found that I had some people who really wanted to grow the concept but were held back for various reasons, some of which referred to the concepts that I talked about just a moment ago. And once the cleanup was done, these passionate, restaurantour leaders, were able to expand Eastside Mario's and get the fundamentals. One of the things you find in the restaurant business, is that they didn't have base cases, they had feel... they thought something would be okay. But they didn't know factually what would be okay. And perhaps when you're running one or two smaller restaurants or enterprises, feel is sufficient. But if you really want to roll things out, you have to establish your best base case, you have to establish standards. And that's pretty much what we did. We established base case. So we formalized a whole process. And perhaps that's one of the things, the training, the Ivey training taught me to do.
Eric Morse
Thanks, John. So you went on to have a number of brands in Prime Restaurant Group, it became the group after a while
John Rothschild
Yeah
Eric Morse
Were those brands built organically by your team? Or did you acquire other chains or? Yeah, all of the brands we developed internally, okay, Eastside Mario's certainly was an internal brand. Casey's, the pubs Fionn, McCool's was the primary name of our pubs. And then one of our last concepts that was really a fantastic concept was a Belgian concept the the Bier Mark. Yeah that is my favorite, by the way.
John Rothschild
Yeah... mine too. I'm not supposed to say who my favorite...
Eric Morse
No, I'm sure.
John Rothschild
Each each concept became like, like a child to me. But yeah, love the Bier Markt and the expansion of that brand. It was wonderful to bring something new to to the marketplace and the Bier Markt with its Belgian beer orientation and food; Flemish food was very, very different than novel at the time. Yeah.
Eric Morse
I'd say you really amazing job growing all of that. And I wasn't aware that it was all organic. That's, that's, that's really neat. John.
John Rothschild
We went on afterwards to acquire brands and in effect be acquired. And so that we became a collection of some very significant and super brands in in Canada.
Eric Morse
Take me through some of that, because you built this great organization and you had an investor come along with with some other brands and say, Hey, what, you know, why don't we together? What was that decision? Like where?
John Rothschild
Yeah, it seemed to me that we had grown significant... not seemed, we did, we'd grown significantly in size, but we were kind of, I coined the phrase, we were a tweener company, we were too big to take advantages of some of the quickness that smaller businesses could achieve. And we weren't large enough to achieve some of the significant scale that that was necessary in a... in a large company. So it seemed to me that was important to get the larger. We had identified a couple of opportunities, the best and the strangest circumstance to come along and wonderful circumstance was meeting the people from Fairfax Financial. They had determined that they wanted to get into the restaurant business, they had had an investment in Quebec, which wasn't working out as well as they had hoped to. And they, by then Prime Restaurants was a public company. Fairfax helped us to take the company private, which was nice. And then once private, we looked around and identified that Cara was the... was a wonderful company. It was in similar trouble, if you wish to what Prime was in its early days. And there was an opportunity where Fairfax was able to acquire majority interest in in Cara and merge prime in with the deal and so we became one company called Cara and then turned Cara around quite quickly, and then went on a buying spree.
Eric Morse
Back up just a little bit for me, the I mean, it. It's amazing story. And basically, we're running the restaurant business for Cara or the merged entity, which is really a who's who of restaurants across the country. I mean, they're, they're, you know, deep Canadian brands. But now you've got, you know, Fairfax, you've got Cara, what was that like now suddenly to be, you know, had these other partners in the business with you after after being kind of your own guy for so long?
John Rothschild
Yeah. When you make the determination that you don't want to be caught in between, you don't want to be a tweener. You are prepared then to give up certain things to get certain things. So the days of running Prime came to an end days of getting involved in doing Cara became the way to go. And that's it just was a fundamental change in fundamental change that I was prepared for. Also, Eric, I was a lot older, as as we did this, and so on. Yeah, thank you. So perhaps, it was also a bit of a career change and acknowledgement that entrepreneurism has a lifespan, at least in my case, since it was not going to be a family business. Therefore, it has a best before date. So yes, I got involved in the management and operations of Cara. And then after a couple of years of the company being put together and safely merged and operating properly, I retired from management, stayed on the board for a number of years to help guide it from a board perspective. And it was a pretty, not pretty, it was an extraordinarily satisfying career. I love... I do not regret one bit any of the career paths. There may have been 1, 2, 3, or maybe even four days from a granular perspective that I have regret, but in general in planning a career, and I shouldn't use the word planning because in many ways, it was somewhat self-evolving. Things that you're not in control of and some sometimes it's good, they're good things. They said meeting the Fairfax people. They are the finest and the best people I've ever come across. That was very fortunate.
Eric Morse
Yeah, great when you find a partner that you fit with like that, you know, we're interesting, you know, you talk a little bit about some of the, the tough days, granular days, we really come through a very tough time we're not, we're not through it yet, for the restaurant, hospitality industry with the pandemic, you also were able to navigate some tough times and financial crisis and some other, you know, downturns in the economy. I don't know if you have a perspective on the pandemic, but but maybe just, you know, some of the things that you had to do during the down cycles that you have gone through that you you might, you know, Ideas you might give to the entrepreneurs as they try and fight through this time
John Rothschild
Being to the abyss. And looking deep down into the... into that abyss is frightening. It's frightening. The one that certainly I lived through was the 07-08 and 09, 'ish years of a recession, real estate blowing up, and I thought to all of my life's works, could come to an end. So yeah, that's, and there is a saying about when the going gets tough, the tough get going, I didn't really look forward to putting into practice, but we did. One thing was that we learned some of the restaurant operations that were marginal, and that were keeping going in good times, we decided... we had to take a hard decision and let them go or shut them down. It was just taking up too much management time to to run operations, that we're never going to be profitable, if you want to call them The Walking Dead. We had to do that. Clearly, I learned that how important good management is, or good people are. My partner and I, we had a choice of reducing the salaries of our people and seeing it through, or frankly, keeping their salaries the way they were, and reducing our salaries, the senior management; myself, my partner, down to zero. Yeah, and that's what we chose to do. We didn't tell anybody that we're doing with it. And that way, we were able to maintain all of our staff, all of our key people. And so when we came out of the recession, we had all of our key people in place. And we had closed down all of the anchors that were weighing down our our business. 2010 was our absolute best year, to date then in performance. So we came roaring back. The same thing will happen now, the same thing is happening now. We're in the throes of the comeback, once, at least in Ontario, we get to have full occupancy in our restaurants. And people feel a lot safer in going to restaurants. And I think they should feel safe, even today, the business will come roaring back. And I know ...and Cara or as we're now called Recipe (Unlimited) has done everything to maintain and encourage all of the key people to be there. People are the secret. And that's and that's what Recipe has done. It's very similar to what I saw in 2008 through nine.
Eric Morse
Well kudos to you, I don't think we had the same programs back then that we did today going through in terms of helping you keep some of the key people in and, you know, you made the hard decisions to do that.
John Rothschild
Eric, there was nothing heroic that we did. It was just the right... You know, when you're doing the right thing, it is the right thing. So it was just a matter of doing the right thing. And doing the right thing is timeless, doesn't matter whether it's the financial crisis of the 08 period, or the pandemic crisis of now or any crisis... crises that may get ahead.
Eric Morse
Yeah, the two things I take from that John, one is, you know, people are, are critical, good people are critical to your success, and making sure that they're set and prepared to take advantage of the good times when you come through them is key. And you did that well. The other piece that I think a lot of growth companies, you know, probably don't do quick enough, is those marginal pieces of the business that are really much more of a drain, even when they're breaking even because of the amount of mental time that the leadership has to put into them. And in good times, you know, we sometimes do that longer than we should and when things turn down, it becomes much more obvious that it's a drain and so, you know, making those things quickly for the health of the overall business and preparing yourself to grow is I think, a hard thing for most entrepreneurs and...
John Rothschild
Yeah, sometimes you have to cut off an arm to save the body. No sane person ever wants to cut off an arm until you must.
Eric Morse
You know, one of the I don't know is that always brought a smile to my face. And a bit of a chuckle is when you went into Undercover Boss, that show that was on for a couple of years back then. Loved your disguise and everything about the whole thing, having known you for several years at that point, what just what was that experience like John, little out of your norm?
John Rothschild
Yeah, Eric, the evolution of getting on the show was funny, because I didn't believe it was a crank call. And once once I got past that, it was probably one of the best experiences I could I've ever had in my life and were the show are the opportunities still available to people, I would encourage them to do it. I got to meet the grassroots people in my organization. You know, you preach from as they call it, the ivory tower, what you should be doing what the right thing is to do. But you really don't have the feel, the touch, the... the the getting down to the customer interface, the person that come the dining, the person that's in dining at your restaurant. So as a result, I got to meet some of the most wonderful people in our organization, from a blind dishwasher. Believe me, I'm a wonderful man, to a fabulous chef to a woman who was running our pizza production area, I got to meet people that I would not normally meet. And one of the things that I saw was universal from everybody. These were people, different jobs, different restaurants throughout the country. But universally, they said and they said it so succinctly, so better than we could have even wordsmith... smithed it. They said, "hey, if I wouldn't eat it myself, I'm not serving it." I mean, and it said to me, somehow, someway, these guys are getting the message.
Eric Morse
Yeah.
John Rothschild
So I love meeting all the young people and my life is blessed for meeting all of them. And as you know, the part of the show is not only do you give of yourself in terms of participating, and being in the restaurants and working the job, and I must say, in many in all instances incompetently. All of the kids were so much... they were great, but you get to see your company, at its grassroots, I think in part of the reward system that is part of the show, you also get to make a difference in each one of those individual people's lives. And, and it's... it's the most gratifying experience than meeting these young people hearing them hearing their words and their dedication to the company and, and helping perhaps to even make a difference in their lives. What an opportunity. Yeah, it was...
Eric Morse
Well, well, well done. Yours ended well. Not all of them did if we remember.
John Rothschild
Yeah. Well, I don't know about the others. I just know that the the young people that I met, my life path wouldn't normally cross theirs. And I feel so blessed that it did.
Eric Morse
Yeah, that's very cool. Now, John, when you look back, you know, what's maybe something you wish you had learned at university that would have helped you in your entrepreneurial career that that went missing?
John Rothschild
I don't know how to answer that question. I can only say that I wasn't looking for the Holy Grail at the business school; there is none. What I was looking for, and I didn't learn this until I reflect backwards is a toolbox. Give me a kit that I can apply to almost any or many situations... give me a way of analyzing, helped me to understand a complex problem and reduce it to its simplistic, action-oriented way. So Ivey gave me that toolbox. If you can take complex issues and reduce them down to one, two or three very important 'gotta haves' and, and make it action-oriented. I mean, talking about something is useless, unless it's accompanied by by action. That's what Ivey gave me. I don't know enough about the formalities of entrepreneurism the way it's taught today. But I know that if I were to start a course at Ivey that's what I would want to make sure that the toolbox of analyticals action, assigning tasks, getting them done was done. And, of course, in that there's a sophistication understanding numbers and balance sheets and all of the technical things that are part of the course makeup. That's also part of the the toolbox. I hope that answers your question. I'm not sure. But that's...
Eric Morse
Yeah, no, I think that's great. Thanks, John. I that toolkit you get coming out of IB through the case study method and some great faculty and good peers. Right. Let's not underestimate the value there... it does help you with a great tool.
John Rothschild
Eric, let me let me respond a moment to that.
Eric Morse
Sure.
John Rothschild
I'm coming up to I think I'm two years short of 50 years since I graduated. I have stayed in touch with my MBA guys, the last Thursday of every month, we get together for a drink.
Eric Morse
Well, you used to do that to the international Bier Markt. Where do you go now?
John Rothschild
Well, we, well, we've been, I'm going to say we've been beneficiaries, perhaps of the pandemic and that we no longer go to a pub, but we do it on Zoom. And as a result, we've been able to include guys who are all over the world guys in New Zealand, in England and Scotland and all over the United States, in Israel... It's just wonderful to see these guys and stay in touch. That's what Ivey did for me. I kept in touch with my MBA class. Unfortunately, many of the professors in my day are no longer around. But through involvement directly with you, and tangentially with you and other things. I've stayed in touch. Ivey, I cannot tell you how important it has been in the development of my my career.
Eric Morse
So thanks, John. It's amazing. You're you're still that level of communication with your classmates and your peers. That's fantastic.
John Rothschild
Yeah.
Eric Morse
Hey, you've been back and you you actually do, you know, teaching in our program in a number of different ways. But one of the ones is through EIR (Entrepreneurs-in-Residence), and you've given back a lot of your time to the next generation of entrepreneurs coming through. What is it that brings you back? To help with that you enjoy the teaching? Is it the students is a combination?
John Rothschild
It's all of the above. First of all, since I was such a beneficiary... benefited from my MBA education, I mentioned earlier, how I feel it's important to pay it forward or pay it back in some way and be involved with Ivey. Then you Eric, and your profs allow me to interact with the students. There's no talking about don't do this, don't do that. It's you're completely trusting and open. And the minds, the young minds are just so dynamic. The people... the the level of student at Ivey, is just remarkable. They need to be honed or more experienced. But there's drive and it's really a two way street. The feel that I could give something to these young minds is stupefying to me. And frankly, getting an understanding the way they think helps me to stay in touch with today's realities.
Eric Morse
Yeah, they're amazing. I leave every class feeling like I've learned something for sure. But I'm sure John, you're, you know, what they don't have his experience and your wisdom over the years is something that they learn from as they interact with you over time. And, you know, it may not even be something that's explicit, but I have that I know that that's happening as well.
John Rothschild
Well, I tell them, often use the phrase that maybe in something I say, there will be a diamond that will come out of my mouth. Okay, that could it may not strike them as a diamond, then it may reverberate some some time in the future. There's some lumps of a lot of lumps of coal that come up in my mouth too. But the idea that something could influence tomorrow's leaders...
Eric Morse
Yeah.
John Rothschild
Is is is is awesome. It's mind boggling. So thank you for letting me, exposing me to those brilliant minds.
Eric Morse
Thank you, John, is there if you were, you know, just thinking back on your career, one piece of advice that you would want to pass on to aspiring entrepreneurs or those that are just getting going and their entrepreneurial journey and anything that you'd want to pass along to them?
John Rothschild
This is a funny question that I could say, yeah, do this and do that. It's not really the case. And then you've got words about when things aren't working out, you call it a pivot. My best advice is hang in. When things get tough, you have to get tough and get get with it. There is a solution. And many people will walk away from a situation when it gets tough. Hang in there. If you believe with what believe in what you're doing, your passions need to be well invested or need, you need your passions, when you're in tough times. And I'm not preaching tough times. But I can tell you in any situation, you would be silly not to be prepared for a tough time happening and it can be unpredictable, but hang in. Believe in your people. Believe in your team believe in your confreres and believe in your company. And hang in during tough times.
Eric Morse
John, You know, it's it's interesting, I would say, this legend category that we've created for these podcasts... that's a recurring theme and, you know, to reach that level means that you've had a long enough career that you've you've seen, the abyss is, as you mentioned, and, you know, to reach legend status, it means you've come out the other side. And I think that, that grit, that determination that that willingness to really put your nose into it and figure it out, rather than hoping somebody else will seems to be a key differentiator, you know, small sample, but that's it's certainly makes sense to me as we look back at these.
John Rothschild
Yeah, Eric, it does. And, and frankly, my best opportunities have come from surprising places. Had I not hung in and seen something through another opportunity, which led to something else just wouldn't have happened. I've often heard of an entrepreneur being described as being similar to a spoiled brat. And if you think about it, they both don't take "no" for an answer.
Eric Morse
All right.
John Rothschild
Although, although perhaps an entrepreneur is more positively oriented than a spoiled brat. There's some similarities of, of hanging in there that are universally true. And if you do, the rewards that can come are can be can be breathtaking in many, in many cases. And that was the case for me.
Eric Morse
John, I want to I want to say that I've valued your friendship over the years. And I think that's, that's what it's been. And I look forward to many more years of that friendship going forward. And you know, your wisdom has helped to shape what we do here and entrepreneurship at the Ivey Business School and now at Western University and want to thank you for that. And I think everybody listening today hopefully will take a takeaway, a little bit of that wisdom and apply it in their own career and be the better for it. So thanks so much. I really, really appreciate it.
John Rothschild
Thank you, Eric. It's entirely mutual. I truly value our friendship. And we are linked in our desire to have the next generation be even better than than our generation has been. And so pay it forward.
Eric Morse
The Entrepreneur Podcast is sponsored by Quantumshift 2008 alum Connie Clerici and Closing the Gap Healthcare Group. To ensure you never miss an episode, subscribe to the show on your favorite podcast player or visit entrepreneurship.uwo.ca/podcast Thank you so much for listening. Until next time,