Walt Disney, McDonald's and using celebrities to kill life insurance objections

By Brett K

Insurance Mavericks


People love celebs. Magazines, TV and Internet are constantly flooded with them. People trust them, like them and want to be like them. That's why we often use powerful celebrity stories to overcome the concerns that most people have with life insurance.

Here are a few examples.

​The Wonderful World Of Disney

Walt Disney's story is almost too hard to believe. One of their most popular characters was stolen by another studio. Their best animator jumped ship. Their studio was chronically understaffed and almost always in debt. In fact, Walt Disney struggled financially for years on the brink of bankruptcy.

Fast-forward to the early 1950s. The only amusement parks in the entire country were horrifically dilapidated places peppered with rusting, creaky rides and known only for their filthy restrooms and the drunks that always hung around. Walt dreamed instead of an immaculately clean amusement park filled with imaginative rides — a place where families weren’t afraid to eat the food.

Everyone to whom he presented his idea thought he was crazy — and told him so.

Even his brother Roy — also his business partner and financial manager — told him it couldn’t be done. Determined to achieve his dream, Walt had no choice but to move ahead on his own. Turned down by traditional financing, he emptied his savings account, sold his vacation home in Palm Springs, and recruited the help of a few employees who shared his vision. Then, he used a loan from his cash value insurance policies to help finance the park. (Roy later admitted he had no idea where Walt’s money was coming from, but decided not to ask.)

Disneyland opened on September 8, 1955, with 18 attractions. It welcomed half a million visitors in the first month it was open. By the end of its first year, it had hosted more than 3.5 million guests. Less than three years later, it welcomed its 10 millionth visitor — a number that exceeded well-known national landmarks like Yellowstone and the Grand Canyon.

Ray Kroc and McDonald's1

Ray Kroc came from humble beginnings. Born in Chicago in 1902, at the age of 15 he lied about his age and landed himself a job as an ambulance driver for the Red Cross.

In 1954, at the age of 52, and working as a milkshake machine salesman, Ray took notice of a hamburger stand in San Bernardino, California. Kroc saw the two legendary golden arches and saw lines of people queued up for the restaurant’s simple fare of burgers, fries and milkshakes.
Ray managed to convince the owners to sell the McDonald’s name and trade secrets to him, and worked a deal to pay for it with a percentage of the receipts. McDonald’s was on its way to becoming a household name. In 1955, Ray opened his first McDonald’s drive-in restaurant in Des Plaines, Illinois.

While things inside the restaurants ran smoothly, Ray faced massive challenges with cash flow, franchises, competition and the economy in general. He was determined to be successful and spent year after year, working day and night, to build his company.

In order to build the largest fast-food chain in the world and overcome constant cash-flow problems, Ray took out loans on two cash value life insurance policies to get his infant company off the ground. He used some of the money to create an enduring advertising campaign that centered on the company’s mascot, Ronald McDonald.

Ray Kroc passed away from old age in January 1984 at the age of 81, just 10 months before McDonald’s sold its 50 billionth hamburger. At the time of his death, there were some 7,500 McDonald’s restaurants worldwide. Today, with more than 25,000 restaurants worldwide, McDonald’s is the world’s largest food service retailer, with operations in more than 65 countries.

J.C. Penney

In 1898, James Cash Penney was working in a Golden Rule Store, which was one shop in a small chain of dry goods stores. He turned out to be such an enterprising worker that the pair of owners took him under their wing, offering him a one-third partnership in a new store they were opening.

During the next five years, James helped open two more stores and was doing very well. By 1912, he was running 34 stores throughout the Rocky Mountain region.

The next year, James moved his company headquarters to Salt Lake City, Utah and incorporated under a name you’ll easily recognize: The J.C. Penney Company. The J.C. Penney chain exploded and by 1929, there were 1,400 stores throughout the nation.

Then things got interesting. The stock market crashed, and the nation was plunged into the depths of the Great Depression. The Depression devastated his stores and his wealth. He was in financial ruin.

Luckily, James had not risked all of his money in the market. He had built a safe money foundation. To rebound from the difficult times, he took out a loan from his cash value life insurance policies. He used the cash to meet day-to-day and payroll expenses for his chain of stores. Not only did he keep his head above water, but he also rebounded. Today, the stores take in revenues nationwide of $18.5 billion a year.
Doris Christopher and The Pampered Chef

Doris Christopher may not be a name you recognize, but you've probably heard of the company she founded: The Pampered Chef.

Doris was a successful home economist and educator — but she had a dream. All those hours working with homemakers had convinced her that women needed quality timesaving tools designed to make cooking quick and easy. Women didn’t want to spend hours and hours in the kitchen grinding out meals — due to their increasingly busy schedules,they wanted to create great meals, quickly.

Doris not only had a dream; she had a plan. Doris’s plan involved an army of consultants who would do home cooking demonstrations using her professional-quality tools and equipment. Tupperware had done it, and with outstanding success — a homemaker schedules a party, invites her friends and the rest fell into place.

With the support of her husband, Jay, and that of her two young daughters, Doris came up with a detailed business plan and got ready to put it into action. The only thing standing between her and her dream was money.

Her solution was simple. In 1980, Doris borrowed $3,000 from her life insurance policy, and The Pampered Chef® was born in the basement of her suburban Chicago home.

In the ensuing decades, the business moved to a series of progressively larger facilities. By 2002, the company had blossomed into a $700 million enterprise that was acquired by Warren Buffett’s Berkshire Hathaway Corporation.

Today, the Pampered Chef® has grown into a multimillion-dollar international corporation serving 12 million customers annually — and it all started with the loan from her life insurance policy.

1 Adapted from Catherine and Richard Greene, The Man Behind the Magic: The Story of Walt Disney (NY: Viking Penguin, 1991).