In 2012, Peyton Manning bought into 31 Denver-area Papa John’s restaurants; six years later, he sold his stakes two days before the NFL ended its sponsorship deal

Most people remember Peyton Manning for his football throws, but not for tossing pizza. For 6 years, the two-time Super Bowl winner was a Papa John’s franchise owner, co-owning 31 restaurants in the Denver area. Then, in February 2018, Manning sold every restaurant he owned. Two days later, Papa John’s ended its sponsorship deal with the NFL, closing out an eight-year partnership that had begun in 2010. According to multiple outlets that later covered the sale, the timing was so precisely aligned that it almost seemed planned in advance. Whatever the reason, Manning’s exit is a useful example of knowing when to step back from a brand before its troubles become yours.

A quarterback with a side hustle

Peyton Manning bought into the Denver Papa John’s franchise network in 2012, while he was still an active player, having just signed with the Broncos that year, and eventually owned 31 stores as a joint venture with Papa John’s International. This set him apart from the more typical pattern athletes follow: investing in franchises only after their playing days are over. According to Restaurant Business, there has been a distinct trend of former athletes moving into franchising once their careers end, since the network supplies the equipment, products, and marketing support needed for a successful launch. Manning, by contrast, built his franchise stake during the middle of his career and held onto it for two years after retiring in 2016, before selling in 2018.


The exit, and the mess that followed

In early 2018, Papa John’s was in serious trouble. Founder John Schnatter blamed the NFL’s reaction to the player protests of the national anthem for the downfall of sales, which ultimately led to him losing his position as the CEO of the company. Manning sold his stake to an existing Papa John’s franchisee on February 26, 2018, per Restaurant Business. Two days later, on February 27, Papa John’s ended its sponsorship of the NFL. The following day, February 28, the NFL announced Pizza Hut as its new official pizza sponsor, replacing Papa John’s, not the other way around. Manning continued to operate as a brand ambassador, but he sold all of his restaurant stakes.

Peyton Manning’s milking of the exit strategy may not have been purely about timing; it was not the only reason why he decided to sell his 31 Papa John’s franchises. In July 2018, it was reported by Fortune that Schnatter had used a racial slur during a media training session, and he was removed as the chairman of the company. While none of these scandals have affected Manning directly, as he sold his shares months before the controversy erupted, they do highlight a vital lesson that not everyone knows about franchising and brand endorsements.

What the research says about standing too close to a falling brand

Apart from common sense, there is also scientific research that explains Manning’s wise decision. According to a 2014 peer-reviewed paper titled “Guilty by Association: The Perils of Celebrity Endorsement for Endorsed Brands and their Direct Competitors,” by Carrillat, d’Astous, and Christianis, and published in Psychology & Marketing, negative consumer reactions to a sponsored brand not only affect that company but also unrelated competitors in the same category, as well as any associated brand ambassadors that endorsed the company.

In other words, whenever a company endorsed by an influential personality faces a scandal, said personality is at risk of suffering the consequences of the scandal too. For a brand ambassador, this often means loss of reputation, income, and even legal issues, depending on the severity of the situation.

The takeaway

There is a broader lesson in how Peyton Manning managed his exit from Papa John’s ownership. Selling his equity stake in February 2018, just before the brand’s NFL sponsorship ended and months before the Schnatter controversy became public, let him step away from the financial risk while retaining his separate role as a paid spokesperson, a relationship Papa John’s has said he still holds. The same principle applies to anyone building a public reputation through business ties or endorsements: knowing when to exit a financial stake in a troubled brand, while it’s a separate question whether to keep an endorsement relationship, can make the difference between walking away clean and getting pulled into the mess.