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How a Business Mogul Rejected Steve Jobs and Apple's Billions for His Undying Love of Pizza
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The notion that hindsight is 20/20 is perhaps nowhere more true than in business. Just ask entrepreneur Nolan Bushnell, who in the 1970s turned down an opportunity to help an enterprising Steve Jobs to launch Apple. As the pioneer of early video game sensation Atari, which introduced its household video game console when chips were cheap, Bushnell was the Apple co-founder’s inspiration. Therefore, it stands to reason that Jobs would have turned to Bushnell, who at the time was building Atari’s latest console while Chuck E. Cheese was a glimmer in his eye, for funding.
In the mid-1970s, Jobs asked his former Atari boss, the godfather of video games, for a $50,000 capital injection to help get his tech startup off the ground. In exchange, Jobs offered his mentor 33% of his company, then called Apple Computer, in a display of how much he valued his contribution. If Bushnell had accepted, that stake would have been worth a fortune that would make Bushnell one of the wealthiest humans on the planet. But fate had other plans.
Bushnell decided to decline his prodigy’s offer, instead choosing to focus his energy on building his next empire – Chuck E. Cheese family restaurants. Besides, as Bushnell told ABC, Jobs wasn’t an easy person to work with, which is why as a young engineer he was put on the night shift. Perhaps Bushnell, who once told Jobs “democracy in a company creates mediocrity,” feared the two personalities would have clashed. Little did he know back then that Jobs, who alongside Steve Wozniak created Atari’s video game Breakout, was destined to change the course of history with the introduction of the Mac and iPhone while Apple would one day be valued at multiple trillions of dollars.
Bushnell, who has an estimated net worth of $50 million, later admitted “he’s done some really stupid things.” But he has also managed to keep a proper perspective, saying: “I’ve got a wonderful family, I’ve got a great wife, my life is wonderful. I’m not sure that if I had been uber, uber, uber-rich that I’d have had all of that.” Incidentally, Bushnell also had beer taps installed at all of his companies.
While Bushnell has had to live with his decision to decline a stake in Apple, that choice appears to have ignited a chain of events in his businesses that have caused him regrets and kept his legacy from reaching its full potential.
Chuck E. Cheese on the Block
- 2023 Annual EBITDA: $195 million
- 2023 Profit Per Day: $534,246
Bushnell would go on to create Chuck E. Cheese, originally known as Chuck E. Cheese Pizza Time Theatre, as a concept in which pizza, an indoor arcade and entertainment would all exist under a single roof. The family restaurant, which began in San Jose, Calif., evolved over the years and eventually went international.
Bushnell’s involvement with Chuck E. Cheese lasted for less than a decade and included a bankruptcy filing before he ultimately sold out to rival Robert Brock in 1984. By this time, Bushnell had also sold Atari to Warner Communications in a $28 million transaction, which turned out to be another big mistake that he says “destroyed” the company.
In 2022, Chuck E. Cheese reportedly generated annual revenue of $348 million across 500-600 locations. Meanwhile, Chuck E. Cheese parent company CEC Entertainment in 2023 targeted $1.2 billion in annual revenue and EBITDA of $195 million.
Chuck E. Cheese was hit especially hard by the pandemic year, forcing it to file for bankruptcy protection for a second time in Q2 2020. These days, Chuck E. Cheese is reportedly on the block, having engaged investment bank Goldman Sachs to pursue a sale. According to Chuck E. Cheese parent company CEC Entertainment, the business could attract a price tag of over $1 billion.
Apple a Day
- 2023 Net Income: $96.9 billion
- 2023 Profit Per Day: $265.7 million
Jobs’ ride with Apple was anything but smooth, including his departure in the mid-1980s to pursue another venture. But without Jobs, Apple was a shell of its former self and was headed for failure. Fortunately, Jobs made his way back to the company he co-founded with high school pal Steve Wozniak, and the rest is history. Jobs successfully made Apple profitable, once declaring that he “would never accept margins under 22%,” a standard that remains at the company today.
There’s no telling if Bushnell would still own his 33% stake in Apple today had he invested, most likely that would not have been the case. But 33% of Apple at Today’s valuation would be around $890 billion. But he finds comfort from the movie “Back to the Future,” saying, “If you change a little thing, everything could have changed.” He goes on to explain how he was responsible for introducing Jobs to Don Valentine, who was the link to Mike Markkula, who before becoming CEO agreed to provide Apple with the funding it needed at the time.
As one of the most profitable companies on the planet, Apple generated net income of almost $97 billion in its last fiscal year amid $383 billion in revenue. The tech juggernaut earn $265.7 million per day, based on the latest annual results. That’s a tough act to follow for any company, including Chuck E. Cheese.
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