September 30, 2015 by Alex Counts
(L-R): Arcelia Gomez and Alex Counts of Grameen Foundation meet with Fred DeLuca, co-founder and president of Subway Restaurants, at the 2014 Subway Convention
The first time I heard the name Fred DeLuca I was spending some time at the Women’s Self-Employment Program (WSEP), a leading Chicago-based practitioner of U.S. microfinance at the time. His untimely death on September 14 profoundly saddened everyone connected to Grameen Foundation, which I founded in 1997.
Back then, I was researching my book Small Loans, Big Dreams, which covered the experiences of microcredit in Bangladesh and U.S. inner cities. Connie Evans, the founder and CEO of WSEP, told me how Fred was eager to support a rapid scaling up of microcredit in the United States after having learned about the successes in Bangladesh. He wanted to apply what he had learned making Subway Restaurants into such a breakthrough company in terms of growth of franchises and, in so doing, putting thousands of budding entrepreneurs in business at an affordable cost.
I contacted Fred a few months later, once I had started Grameen Foundation, and I was soon exploring opportunities for collaboration with Michele Klotzer (now Michele DiNello), who has been our key point of contact ever since. Subway and the Frederick A DeLuca Foundation sponsored a table at our first gala, held in June 1997, and a trip to some of the poverty-stricken areas of Connecticut was arranged for Fred and Professor Yunus. It was a visit they both enjoyed tremendously.
And why wouldn’t they? Both came from relatively humble backgrounds, saw a need to start a business with the potential for social impact, got started, set aggressive growth and quality goals and met or exceeded most of them. They cultivated talent, started or supported complementary enterprises, and inspired imitators. Fred’s success at turning a $1,000 loan in 1965 into the world’s largest restaurant chain stands alongside Professor Yunus’ lending of $27 to 42 villagers near his university classroom (and building that into Nobel Peace Prize laureate Grameen Bank) as two of the most incredible and improbable achievements of modern times.
Fred supported, financially and with the expertise inside his company, Grameen Foundation’s work in U.S. microfinance, which centered on providing financial and technical resources to Project Enterprise and the PLAN Fund (today part of the People’s Fund of Austin). Hundreds of clients of these two organizations received financing, peer support, and technical advice in starting or expanding tiny businesses.
Fred asked me to speak at the Subway Convention in Atlanta in 1999. Obviously, it was a great honor. I was 32 and had never, up to that point, spoken to such a large group before. (There were about 2,000 Subway franchise owners, managers and employees in attendance.) It was a bit overwhelming, but Michele told me that lots of people had tears in their eyes after I told them about Grameen Bank and our ambitions to bring microlending to the U.S. market. Fred was very generous and poignant in personally introducing me to the delegates before I spoke. He also wrote about our partnership in his terrific memoir, Start Small, Finish Big and has been donating the proceeds from the eBook edition to Grameen Foundation.
Ultimately, Grameen Foundation decided to focus on its work overseas (which Fred has continued to support). Our highly successful sister organization, Grameen America, now leads the charge in the U.S. market. In fact, Grameen America has lent $312 million to more than 55,000 low-income women micro-entrepreneurs through 18 branches in 11 U.S. cities, including nearly $ 173 million since January 2014. Grameen America’s borrowers build credit scores, gain financial literacy, and create businesses that that help to revitalize local economies.
I last saw Fred at the Subway Convention in San Diego in August 2014. My colleague Arcelia Gomez and I set up a booth on the convention floor and met hundreds of delegates, many of whom were vaguely aware of our alliance with their company, and with Fred’s foundation, and wanted to know more. Many signed up for our mailing list and have kept in touch, and even contributed financially. All were eager to find out more about our poverty-reduction strategies and how they had evolved to include a strong emphasis of using information technology, which itself was inspired by Prof. Yunus’ vision for technology’s role in amplifying the positive impact of financial services on the lives of the poor.
Arcelia and I greeted Fred as he was touring the exhibitor booths. He was warm as always. He asked me about how Grameen Foundation and Prof. Yunus were doing, graciously posed for pictures and agreed to introduce me to some of Subway’s leaders in Asia, whom we had missed connecting with at the convention. (And he did do that, despite his health issues, once again demonstrating that effective leadership involves managing thousands of details and following through on commitments.)
I hoped that I would see him again in the months ahead. That was not to be, but like many others I can continue to track the impact of his successes at business, philanthropy and the dynamic intersection between the two that he and Professor Yunus understood better than almost anyone else I have ever met.
Earlier this year I announced that I would be stepping down as CEO of Grameen Foundation this year. An end of era gala is planned for November. When I walk into the room that evening, and think about all the people who influenced me and helped build Grameen Foundation into the organization it is today, Fred DeLuca will be at the center of my thoughts once again.
For now, all of us at Grameen Foundation are in mourning and send out our thoughts and prayers to Fred’s family, loved ones and colleagues.