Squawk Pod: Leaders Playbook – Inside Shake Shack

Date: January 14, 2026
Host: CNBC
Guests: Danny Meyer (Founder, Shake Shack & Union Square Hospitality Group), Rob Lynch (CEO, Shake Shack)

Episode Overview

This episode of Squawk Pod’s “Leaders Playbook” dives into the remarkable story behind Shake Shack, one of America’s most iconic fast-casual restaurant chains. The conversation centers on Danny Meyer’s unique hospitality-driven leadership philosophy, the company’s humble roots in a New York City park, and its audacious growth ambitions under incoming CEO Rob Lynch. The discussion spans enlightened hospitality, hiring for emotional intelligence, the challenges of the pandemic, and the recipe for scaling culture without diluting what makes the brand special.

Key Themes & Insights

The Philosophy of Enlightened Hospitality

[02:42 – 04:36]

• Danny Meyer’s Leadership Foundation:
  Meyer explains “enlightened hospitality,” a people-first approach prioritizing employees above all other business stakeholders, with the idea that happy employees create happy guests, leading to business success and returns for all, including investors.

  • Meyer: “Every business in the world has the exact same five stakeholders… we had been prioritizing our own staff first…” [02:42]
  • “It is truly a cycle where I want great things for our investors. But…the input being the people who work there.” [03:25]

• Results of the Approach:

  • Meyer: “When you have happier employees, you get happier guests, then you get more revenue.” [04:15]
  • “The community is like the rising tide that lifts all boats.” [04:28]

From Hot Dog Cart to Global Empire

[04:41 – 06:47]

• Origin Story:
  Shake Shack began as a hot dog cart in Madison Square Park, intended to help revitalize the park, staffed by Meyer’s own out-of-season employees. The community’s response led to installing a permanent kiosk—the first official “Shake Shack.”
  • Meyer: “There was no intention that this become a big business. No intention it would become a public company. It was really to make money for the park.” [06:16]
  • Meyer describes the first Shack’s continued support for the park: “The original Shake Shack…still contributes just under a million dollars in rent to that park every single year.” [06:39]

Reluctance, Expansion, and the Power of Demand

[08:35 – 10:25]

• Hesitation to Grow:
  Personal history (his father’s bankruptcies due to expansion) made Meyer cautious about turning Shake Shack into a chain.

  • Meyer: “My rule was, I'm never going to open another restaurant. And if I do, it's only if I believe that next restaurant can be as excellent as the first one.” [08:45]

• Catalyst for a Second Shack:
  Manager Randy Garuti convinced Meyer to open a second location, arguing it would “cannibalize” the famously long lines at the flagship.

  • Meyer: “The first one only gets busier at this point…a high class problem we’ve got right here.” [10:16]

Going Public and Facing Shareholder Skepticism

[10:38 – 11:33]

• IPO & Values:
  Shake Shack’s S1 (IPO filing) made its hospitality-first culture clear to investors.

  • Meyer: “We came right out and told everybody who we are, what we stand for, what matters…let the buyer beware. That's who we are.” [11:03]

• Leadership Evolution:
  Meyer stepped back to Chairmanship, declaring he’s “a much better chairman than I ever would have been a CEO.” [10:38]

Shifting into “Scale Mode” with Rob Lynch

[11:45 – 14:24]

• Ambitions for Growth:
  Under new CEO Rob Lynch, Shake Shack seeks to scale to 1,500 locations worldwide—a bold leap from 600+ Shacks.

  • Rob Lynch: “We think we can get to 1500 shacks…It’s a big, audacious goal."* [12:16]

• Preserving and Advancing Culture:
  Lynch describes Meyer’s charge to “advance the culture”, not just maintain it, during expansion.

  • Lynch: “[Meyer] said, Rob, I don’t want you to maintain the culture. I want you to advance the culture.” [13:04]

• Fine Dining Roots at Scale:
  Lynch draws the parallel between expectations at a fine dining restaurant and at a Shake Shack, emphasizing experience, not just food.

  • Lynch: “When people make a reservation to go to one of Danny’s fine dining restaurants, their expectations are up here. They should have the same expectations when they come to Shake Shack.” [13:19]
  • “If we [lose the special culture], we become just another burger place on the road.” [14:24]

Hiring for the “Hospitality Quotient”

[15:32 – 16:22]

• The 100% Rule:
  51% of hiring is for emotional hospitality skills (kindness, optimism, work ethic, curiosity, empathy, self-awareness, integrity); 49% for technical ability.

  • Meyer: “Imagine if you had a car where the more you drove it, the more it filled itself up with gas. That's like someone with a high HQ.” [15:32]

• Can It Be Taught?

  • Meyer: “It's hard to teach emotional skills…I do know how to teach someone how to hire for those skills.” [16:26]
  • Lynch: “It's really about finding people that light up when they're taking care of others.” [16:55]

The Pandemic: Ultimate Test of Values

[17:30 – 20:55]

• Layoffs & Transparency:
  The COVID-19 pandemic forced the company to lay off 95% of its staff—testing Meyer’s people-first ethos to its core.

  • Meyer: “How do you reconcile laying people off when you say you're a people first company?...if we're out of business, we're not going to be anyone's employee.” [17:46]
  • “It was just awful. But I think we did the right thing because the only way we could become great employers again was to do the right thing.” [18:14]
  • Supportive outreach included a Hugs Fund, resources, and help finding jobs for former team members.

• Hospitality Included & the Tipping Experiment:
  Shake Shack moved to a no-tipping model to narrow pay discrepancy between front and back of house. The pandemic forced the company to rethink and eventually reinforce this commitment via sales-sharing for kitchen staff when tipping returned.

  • Meyer: “By eliminating tipping, I said, I'm going to be the boss. I'm going to decide how much people are going to get paid. And we succeeded at narrowing that discrepancy by about 25%...” [19:09]
  • Eventually: “We instituted a new policy where we pay a percentage of sales to all of our kitchen workers and all of our non tip eligible workers so that they too have an incentive…” [20:54]

Exporting the Recipe for Hospitality

[20:55 – 22:47]

• Hospitality Quotient as a Consulting Model:
  Meyer formalized his principles into a consulting business, working with companies in sectors from airlines (Delta) to car companies (Lexus).
  • Meyer: “Anyone who's got stakeholders…has learned that the way you make your stakeholders feel is paramount.” [21:33]
  • Lynch on Delta: “The only way you do that is if everyone in your company believes that that is what is the special sauce…” [22:12]

Leadership Reflections & Superpower

[22:52 – 23:40]

• Rob Lynch on Danny Meyer’s Style:

  • “Of a typical hour-long check-in, we probably spend about five minutes talking about the business and the other 55 talking about the people. And that’s super different…” [22:52]

• Danny Meyer’s Leadership Superpower:

  • Meyer: “Probably humility, which is that I don’t think I have a superpower. I really believe that every day is a day to reprove who you think you were.” [23:25]

Notable Quotes

• “Our customers, which we call guests, are never going to be any happier than the people who are working here. They just won’t.”
  – Danny Meyer [03:33]

• “Every business…has the exact same five stakeholders…we had been prioritizing our own staff first…”
  – Danny Meyer [02:42]

• “We had absolutely no idea that Shake Shack would become Shake Shack. No idea at all. There was no intention that this become a big business. No intention to become a chain.”
  – Danny Meyer [06:16]

• “We think we can get to 1500 shacks…It’s a big, audacious goal.”
  – Rob Lynch [12:16]

• “The biggest part of the culture that we need to evolve is we have to help the folks…believe that big isn’t bad. Big does not mean that we can’t be all the special, amazing things…”
  – Rob Lynch [13:55]

• “We looked at our bank account, which was dwindling every single day…if we’re out of business, we’re not going to be anyone’s employee.”
  – Danny Meyer [14:31], [17:46]

• “Imagine if you had a car where the more you drove it, the more it filled itself up with gas. That’s like someone with a high HQ.”
  – Danny Meyer [15:32]

• “Probably humility—which is that I don’t think I have a superpower…I really believe that every day is a day to reprove who you think we were.”
  – Danny Meyer [23:25]

Key Timestamps

• [02:42] Enlightened Hospitality explained
• [04:41] Origins of Shake Shack as an experiment
• [06:16] Accidental path to a global chain
• [08:35] Expansion anxieties & long line “problem”
• [11:03] IPO and preserving values for public investors
• [12:16] Growth goal: 1,500 locations (Rob Lynch)
• [13:04] “Advance the culture” beyond maintenance
• [15:32] The “100% rule” for hiring hospitality staff
• [17:40] Layoffs and pandemic response
• [19:09] “Hospitality Included” and the tipping experiment
• [21:06] Consulting in hospitality leadership
• [22:52] Danny Meyer’s unique focus on people over numbers
• [23:25] Humility as a leadership philosophy

Memorable Moments

• Danny Meyer’s candor about his upbringing and its effect on his risk profile:
  “My rule was, I’m never going to open another restaurant. And if I do, it’s only if I believe that next restaurant can be as excellent as the first one.” [08:45]

• The “high class” problem of customer demand growing as more locations open:
  “As soon as that happened… I said, uh, oh, I think this is a high class problem we’ve got right here.” [10:16]

• Real talk about doing layoffs during COVID, maintaining dignity and support for employees.
  “Many, many, many sleepless nights… it was just awful. But I think we did the right thing.” [17:46–18:14]

• Reinventing industry pay standards with “hospitality included” and a fair wage for back-of-house staff: [19:09–20:54]

Conclusion

This episode provides both an inspiring blueprint for people-first leadership and a candid reflection on the hard choices faced during times of crisis. Danny Meyer’s “enlightened hospitality” has not only built a burger empire but is now echoed in boardrooms far beyond foodservice. Shake Shack’s continued growth under Rob Lynch depends on rigorously advancing—not diluting—the unique culture that has set them apart.