Many entrepreneurs, when starting a company, dream of having their employees smiling, doing a fantastic job of serving customers and all “singing from the same hymnal.” But business owners often find that building such a team is one of their most difficult challenges.
Danny Meyer has achieved that sometimes elusive goal in a tough industry: the restaurant business. Beginning with the Union Square Café, in 1985, Meyer made it a priority to provide truly hospitable service along with great food. He opened a second restaurant, Gramercy Tavern, in 1994, and the two establishments have become perennial favorites of New Yorkers. Meyer’s company, the Union Square Hospitality Group (USHG), has maintained its reputation for gracious service even while creating new restaurants with very different identities and menus. At last count, Meyer’s group of nine restaurants also included Eleven Madison Park, Tabla, Blue Smoke and Jazz Standard, the Shake Shack, a trio of restaurants at The Museum of Modern Art, as well as a catering division. His company now has about 1,000 employees. Meyer’s book, Setting the Table: The Transforming Power of Hospitality in Business (HarperCollins) will be published in October.
Report editor Robert Levin recently sat down to talk with Danny Meyer about USHG’s growth, Meyer’s own strengths and weaknesses and how he builds his team of employee-hospitalitarians.
RL: You opened the Union Square Café in 1985, and between 1985 and 1994 you had just that one restaurant. Since then you’ve opened about eight businesses. Did you consider opening another restaurant during those years when you just had Union Square? What happened to make you decide to grow the business?
DM: It was a very, very different time back then. When I started in 1985, there were really two different kinds of restaurants. The kind where if you wanted to be taken seriously, you were there 100% of the time, looking at every single plate leaving the kitchen and greeting every single guest, and saying goodbye to every single guest as they left.
Or, on the other hand, you had restaurant chains. But the phenomenon that we have actually been a part of creating is of fine dining restaurant groups. That did not exist back then. It was commonly held wisdom that if you opened a second restaurant, there was no way it would be as excellent as the first.
And the very process of opening a second place would probably in some way diminish the excellence of the first. That was because people did not view the restaurant business as anything other than a highly emotional, entrepreneurial pursuit. They didn’t look at it as a well-managed business. To answer your question, it was probably at the four- or five-year point that people started asking me if I would consider opening another restaurant.
What was also happening in the late 1980s was that restaurants were becoming part of the fabric of what New Yorkers did on a nightly basis, unlike the 1970s and early 1980s, when good restaurants were seen as a thing you did for special occasions. But people started to go out a lot more often, and restaurants took their place as one of the central parts of people’s lives in New York. I think other businesses started to take notice, like office buildings, shopping malls, hotels and museums. So opportunities started to come much more frequently for us.
I had never wanted to do another place. The only reason I opened Union Square Café in 1985 was I just had to give birth to this business. It was bubbling inside me; it was a passion that just had to happen. I went into Union Square Café at the age of 27 saying probably one of three things will happen.
I’ll birth it, I won’t be any good at it, and it’ll fail. And that’ll be OK because no one has ever heard of me so I won’t be happy to lose money but it won’t be the end of the world. Or two, I’ll be OK at it and not like it, but at least I will have done it. Or three, I’ll be OK at it and like it, and then I’ll keep doing it. But I certainly did not get into the business with any notion where it might lead, and I certainly didn’t have any notion of where the restaurant industry would go over that period of time.
To make a long story short, it really wasn’t until there was a certain dynamic present at Union Square Café in the early 1990s that I considered another restaurant. At the age of seven or eight years old, the Union Square Café started to regularly lose too many of its veteran employees for my taste. It was simply because they needed to grow and we had nowhere for them to grow internally. The chef at Union Square wasn’t going anywhere, and the general manager wasn’t going anywhere. So people who were really ambitious and in many cases quite excellent had no choice but to leave. That started to tug on me a lot.
Robert Levin is the Editor-in-Chief and Publisher of The New York Enterprise Report. Levin has extensive experience with midsize and small businesses, having previously held CEO, CFO, and COO positions with companies in several industries. He is also a contributor for The Huffington Post. Levin can be reached at firstname.lastname@example.org and (212) 307-6760.