The Profile Dossier: Danny Meyer, the King of Hospitality
“Make new mistakes every day. Don’t waste time repeating the old ones.”
Hello, friends! This week, I spent a few days learning about Danny Meyer, one of New York City’s most respected restaurateurs. I became interested in his story after I watched him give a talk in early 2020 — right before he had to shutter 19 of his restaurants. He’s someone who has learned how to lead through crisis time and time again. I hope you enjoy this one, and I look forward to your feedback.
Union Square Cafe. Gramercy Tavern. Shake Shack.
Danny Meyer doesn't open restaurants. He opens institutions.
But before he was a legendary restaurateur, Meyer wanted to be a lawyer. Well, he didn't really want to be a lawyer, but that was the natural career path for a college graduate with a political science degree.
"I had zero interest or aptitude in the law," he says, an epiphany he had inside a restaurant.
The night before he was about to take the LSAT, Meyer was dining with his aunt and uncle at Elio's in New York when his uncle asked what was bothering him. Meyer explained that he didn't aspire to be a lawyer, but he had to take the LSAT the following morning.
His uncle's words changed the trajectory of Meyer's life. He said, “You’re crazy. Do you know how long you’re going to be dead? Longer than you’re alive. All you’ve ever talked about is food. Why not just open a restaurant?”
Two days after that dinner, Meyer applied to the New York restaurant school. He went on to complete internships in Italy and France, and returned to New York with big ambitions.
In 1985, at age 27, Meyer opened his first restaurant, Union Square Cafe, with zero clue that this would be the defining move of his restaurant career.
"I didn’t know anything except how to treat people. And the first bookkeeper I hired didn’t know how to balance his own checkbook," he says. "And the first waiter I hired, I found him trying to open a bottle of champagne on opening night with a corkscrew. That is a dangerous thing to do."
Union Square Cafe was a massive success largely because Meyer's priority was not the food, the menu, or the decor. It was about how the overall dining experience made customers feel. Although New Yorkers adored his restaurant and wanted to know what was next, Meyer resisted expansion because of something deeply personal.
By the time he was 21 years old, Meyer had seen his father go bankrupt twice. "I'll never forget that," he says. "It just made such a lasting impact." To him, the road to expansion led straight to bankruptcy.
Meyer falsely believed that the bankruptcies were caused by his father's expansion plans. It wasn't until he realized the ventures failed because of his father’s weak "business discipline" and his inability to build a world-class team around him.
"He had a need to be the smartest guy in the room, which I don’t," Meyer says. "I think I finally realized that upon opening Gramercy Tavern. It took some really good hard work internally, and it was those days that we really learned the power of hospitality."
Dubbed "The Meyer Touch," Meyer seems to have unlocked the key to hospitality with nearly every restaurant he touches. Entrepreneurs seek his advice about business and life.
“Business, like life, is all about how you make people feel," he says. "It’s that simple, and it’s that hard."
It's especially hard when it is considered a dangerous act to dine inside of a restaurant. Meyer had faced his fair share of obstacles in the restaurant world, but 2020 was, by far, the most difficult.
"We’ve successfully led through and weathered 9/11 and the financial crisis of 2008, but at no other point has there been such a sustained and massive dual threat to both the physical safety and economic livelihoods of our people, or the hospitality industry as a whole," he says.
The pandemic forced his company, Union Square Hospitality Group, to shutter 19 restaurants, its events business, and lay off 2,000 people. The chef who opened Tabla with Meyer in 1998, died of COVID-19. Meyer was publicly scrutinized for seeking and receiving a loan from the Paycheck Protection Program, which Congress created to bail out small businesses, causing him to have Shake Shack return the $10 million loan to the government.
"It was only a nightmare on the nights that I slept," he says about the closures during the pandemic. "If I want to be a great employer, the best thing to do for people is still be in business when it's all over. That was a really bitter pill to swallow."
Meyer started a relief fund for Union Square Hospitality Group members, contributing 100% of his salary and all gift card sales to it. In total, it raised $1.5 million, which went to former employees that were on his team.
Restaurants, Meyer says, are essential businesses — for the economy and for life. “People use restaurants to do business, to do politics, to socialize," he says. "Our industry employs more people than the auto industries and airline industries combined."
Even during the COVID crisis, Meyer says hospitality is possible even in an inhospitable, socially distant environment. "I've always believed that hospitality is something human beings need to give and need to receive," he says.
Here's what we can learn from the famed restaurateur about the dual importance of cultivating hospitality and leading in crisis.
On building a restaurant empire: As an owner of multiple restaurants, Meyer micromanages with a purpose. He devotes unlimited time to his new ventures, tasting every item on the menu multiple times, suggesting alterations to such minutiae as the size of a sous chef’s dice and constantly consulting with the manager. In this profile, he instructs a chef to alter a B.L.T. so the bacon would stick out on either side. “My favorite thing is watching people enjoy our food,” he says. “I get sort of an insane amount of pleasure out of that.”
On the power of hospitality: Seventy-five percent of all new restaurant ventures fail. Of those that do stick around, only a few become icons. In this autobiography, Meyer shares the business lessons he learned after developing the philosophy he calls "enlightened hospitality."
On creating a feeling of belonging: Meyer says restaurants can't win on food or wine alone. "A long time ago, I realized that food and wine were a starting gate," he says. "I was more interested in turning my restaurant into your favorite restaurant." In this episode, Meyer explains why hospitality is all about unlocking human emotion and creating a feeling of belonging.
On shunning conventional wisdom: Meyer knows one thing: To revolutionize an industry, you have to cast off received wisdom — both personal and professional. From his first restaurant to the dramatic scale story of Shake Shack, Meyer didn't break the rules. He invented the rules. In this podcast, Meyer shares his ideas on why “enlightened hospitality” has radical implications for any industry.
On scaling a feeling: Meyer says there are three things you can scale: product, service, and feeling. It's the feeling that's the trickiest. That's why Meyer came up with a formula that he believes allows entrepreneurs to scale the mushy things we call "feelings." In this podcast, he discusses the HQ (hospitality quotient) necessary for building a timeless brand. It consists of a list of six “soft skills” — things that can’t be taught – that each of his employees must have.
On his passion for developing taste: Meyer believes it’s never about the food. It’s about how the dining experience makes you feel. In this interview, he shares lessons from decades in the restaurant business and why success requires always having something to prove.
On expanding successfully: In this conversation with Tony Robbins, Meyer shares the story of how Shake Shack grew from a hot dog cart into a world-famous restaurant sensation. He also unveils an essential trait that all entrepreneurs have in common that is absolutely necessary to stay relevant in the business world.
On opening Eleven Madison Park: This 2010 documentary follows Meyer and his Union Square Hospitality team in the gut-wrenching creation where they built not one but two restaurants — Tabla and Eleven Madison Park — into one massive space on Madison Avenue in New York City. The three-month construction lasted 11 months.
Be wary of building a cult: We've all heard companies being praised for their "cult-like" culture or following, but Meyer says that's not necessarily a good thing. "A cult can be exclusionary to everybody else who’s not the same. That would be horrible in a business," he says. "That would absolutely be the kiss of death to have a team of people where everybody believes the same things, behaves the same way, comes from the same backgrounds." As a leader, you need to find people who come from different cultures but are eager to learn and incorporate their own twist to the flavor of your company.
Modify the 'rule of two:' Architects and contractors have something they refer to as the rule of two: "Quality, speed, and price. Which two do you want?" Meyer says the restaurant industry uses the same rule of thumb, which he considers a mistake. He believes in a fine casual "mashup" that aims to save you 65% of the time, save you 65% of the money, and give you 70% of the quality. "You’re going to have to pick up your own food and you’re probably gonna have to take your compostable plastic to a special trash, but you’re not going to give up one ounce of what you put in your mouth qualitatively," he says. In other words, think twice before you blindly accept conventional wisdom. There's always an exception to the rule if you're willing to think creatively.
Flip the leadership model: Most leaders think of themselves at the top of a pyramid, and as a result, employ a top-down approach. Meyer sees himself as "a bottom-up manager who subscribes to the concept of 'servant leadership.'" Servant leadership was popularized by the late Robert Greenleaf, who believed that organizations are at their most effective when leaders encourage collaboration, trust, foresight, listening, and empowerment. "In any hierarchy, it’s clear that the ultimate boss (in my case, me) holds the most power," Meyer says. "But a wonderful thing happens when you flip the traditional organizational chart upside down so that it looks like a V with the boss on the bottom." Remember, your leadership style is determined by your own perspective. (Spotify CEO Daniel Ek is another leader who uses this inverted pyramid approach to management.)
QUOTES TO REMEMBER.
"I don't think innovation is about inventing anything. It's about connecting dots."
“The excellence reflex is a natural reaction to fix something that isn't right, or to improve something that could be better."
“Make new mistakes every day. Don’t waste time repeating the old ones.”
“For judges of character, there is no such thing as the color gray.”
"Hospitality exists when you believe that the other person is on your side."
“A great restaurant doesn’t distinguish itself by how few mistakes it makes but by how well they handle those mistakes.”
"Culture is driven by language, and a company CEO is the shaman of the culture."
“Hospitality knows no gender or race.”
"Life is a series of waves to be embraced and overcome."
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