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How I Built This

Advice Line with Danny Meyer of Shake Shack

41 min episode · 2 min read
·
Danny Meyer Of Shake

Episode

41 min

Read time

2 min

Topics

Relationships, Startups, Leadership

AI-Generated Summary

Key Takeaways

  • ✓Culture Formula: Define organizational culture as all celebrated wanted behaviors minus all tolerated unwanted behaviors. Meyer shifted from "family values" language to "expected behaviors" after recognizing that calling a business a family creates grief when accountability requires termination. Specific, observable behavioral standards give every team member clarity on exactly what is expected daily.
  • ✓Day-One Mentality: Sustain quality across decades by asking teams daily to operate as if the restaurant just opened — no scratches on floors, no smudges on glasses, every plate executed as if three critics are present. Meyer credits this practice for Union Square Cafe reaching 41 years and Gramercy Tavern reaching 31 years.
  • ✓Packaging as Ambassador: For consumer packaged goods brands without in-store sampling, treat the physical package as the bartender or host. Liquid Death's "murder your thirst" copy demonstrates how unexpected, playful language on a can communicates brand personality and community belonging when no human representative is present at the point of purchase.
  • ✓DTC Expansion Timing: Founders with under 18 months of retail traction should delay direct-to-consumer shipping until existing retail channels are solidified. If testing DTC, start with a geographically limited experiment and track repeat order rates specifically — absence of repeat purchases signals the channel is an expensive acquisition tool, not a scalable business.
  • ✓Food Service Entry Strategy: Early-stage brands targeting large fast-casual chains like Cava or Sweetgreen face lengthy purchasing department qualification processes. Meyer recommends starting with one or two smaller operators already using your product category, accumulating proof points and operational learnings, then using those wins to approach larger buyers who require education before a sales conversation.

What It Covers

Danny Meyer, founder of Union Square Hospitality Group and Shake Shack, joins Guy Raz to advise three early-stage food and beverage founders on building brand hospitality without a physical presence, managing retail expansion timing, and entering food service channels strategically as a sub-two-year-old company.

Key Questions Answered

  • •Culture Formula: Define organizational culture as all celebrated wanted behaviors minus all tolerated unwanted behaviors. Meyer shifted from "family values" language to "expected behaviors" after recognizing that calling a business a family creates grief when accountability requires termination. Specific, observable behavioral standards give every team member clarity on exactly what is expected daily.
  • •Day-One Mentality: Sustain quality across decades by asking teams daily to operate as if the restaurant just opened — no scratches on floors, no smudges on glasses, every plate executed as if three critics are present. Meyer credits this practice for Union Square Cafe reaching 41 years and Gramercy Tavern reaching 31 years.
  • •Packaging as Ambassador: For consumer packaged goods brands without in-store sampling, treat the physical package as the bartender or host. Liquid Death's "murder your thirst" copy demonstrates how unexpected, playful language on a can communicates brand personality and community belonging when no human representative is present at the point of purchase.
  • •DTC Expansion Timing: Founders with under 18 months of retail traction should delay direct-to-consumer shipping until existing retail channels are solidified. If testing DTC, start with a geographically limited experiment and track repeat order rates specifically — absence of repeat purchases signals the channel is an expensive acquisition tool, not a scalable business.
  • •Food Service Entry Strategy: Early-stage brands targeting large fast-casual chains like Cava or Sweetgreen face lengthy purchasing department qualification processes. Meyer recommends starting with one or two smaller operators already using your product category, accumulating proof points and operational learnings, then using those wins to approach larger buyers who require education before a sales conversation.

Notable Moment

Meyer reframes the word "hospitality" by tracing it to its Latin root meaning hope, arguing that restaurants and food businesses function as a direct antidote to public pessimism and fear — a perspective that redefines the industry's purpose beyond service transactions into something closer to a civic function.

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Episode Transcript

This episode is brought to you by Justworks, one platform that handles the complicated stuff, payroll, benefits, global hiring, and makes running a small business 1000000% smoother. Stick around. I'll tell you more later in the show. Building a business means being 10 people at once. The strategist, the spreadsheet person, the one fixing the office sink. US Bank made a card for exactly that kind of hustle. The creditor and issuer of this card is US Bank National Association pursuant to a license from Visa USA Inc. Some restrictions apply. Hello, and welcome to the advice line on how I built this lab. I'm Guy Raz. This is the place where we help try to solve your business challenges. Each week, I'm joined by a legendary founder, a former guest on the show who will help me try to help you. And if you're building something and you need advice, give us a call, and you just might be the next guest on the show. Our number is 1804331298. Leave us a one minute message that tells us about your business business and the issues or questions that you'd like help with. Alright. Let's get to it. This week, I'm joined by legendary restaurateur, Danny Meyer, founder of the Union Square Hospitality Group. Danny, it's great to have you back on the show. Thank you, Guy. If if any of you listening have ever eaten out in New York City, there's a chance that you know Danny's story. He is the man behind Union Square Cafe, Gramercy Tavern, the modern, and he's the guy who took a single temporary hot dog stand in Madison Square Park and turned it into Shake Shack, which is now a global publicly traded burger empire. Danny, you were last on the show in June 2020. And for those of you who haven't heard the story, we will put a link to it in the show notes, so check it out. That was a crazy time. The world was sheltering in place, and and dining rooms were dark, and and it certainly felt like a long time ago. I think in 2022, you stepped down to become executive chairman of the of the Union Square Group. So first of all, before we get into that, just kind of give us an update about what's what's kinda going on in your life right now. Yeah. Well, yeah, I actually stepped up to become executive chairman. A lot of people thought I was retiring, which could not have been further from the truth. Right. And by being executive chairman, which was actually a term I had never even heard of before, it gave me the chance to continue to come into work every day, but to spend more of my time on fewer of the things, but those things that uniquely lined up with my gifts. So, really, it has to do with the culture of the company, the culinary product of the company, and then …

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