For a company that's now worth over a billion dollars, Shake Shack (SHAK) had some pretty humble beginnings.
The company began as a single hot dog cart in a park in New York City back in 2001, with the food coming from two nearby restaurants owned by noted restaurateur and Shake Shack founder Danny Meyer. After three years of serving food to increasingly long lines, Meyer hatched an idea to turn the cart into a permanent restaurant concept, sketching his idea of what it would look like on a paper napkin.
Since that first official Shake Shack opened in 2004, the company has developed a core menu of burgers, sides and frozen custards, all made with high-quality ingredients such as antibiotic-free Angus beef. More recently, Shake Shack has ventured into fried chicken with its ChickenShack sandwich, which has quickly become quickly become one of its best-selling items.
Shake Shack now has 50 restaurants across the United States and 33 licensed locations overseas in countries such as Russia, Turkey, the U.K., Japan and the Middle East (its largest international market). The company went public to great fanfare in January 2015, with shares more than doubling on their first day of trading. More recently, though, its stock has been challenged as the company struggles to meet sky-high expectations.
Randy Garutti has Shake Shack reaching for ever-higher goals.
One thing that hasn't changed at Shake Shack since its hot dog cart beginnings, though, is the hands-on involvement of energetic CEO Randy Garutti, who helped run the cart when he was general manager for one of the nearby restaurants that supplied it with food. To say Garutti has the restaurant business in his bones might be an understatement.
At the age of 13, Garutti worked at a New Jersey bagel shop and by 17, he was waiting tables at a nearby country club. While working on getting a degree in hotel and restaurant management at Cornell, he took orders at Chili's and traveled abroad to learn about different food cultures. After college, he went off to work at a restaurant in Colorado that moved him to locations in Denver, Maui and eventually Seattle.
When he was 23, Garutti managed to secure a 45-minute meeting with the legendary Meyer, who was famous for opening up restaurants such as Union Square Cafe and racking up coveted James Beard awards. Recalls Meyer, "I saw a guy with more enthusiasm in his little finger than most people have in their entire body, and he was oozing love for the restaurant business, especially fine dining restaurants."
The rest, as they say, is history.
TheStreet talked with the 40-year-old Garutti after the opening of Shake Shack's first location in Arizona in late February. Garutti shared with us how the unique Shake Shack culture works, when he knew he and other executives knew they had something special on their hands and how he balances his hectic work schedule. What follows is a condensed and edited version of our conversation.