I DRIVE MY COMPANY WITH an eye on the same kinds of destinations—excellence, growth and profitability—that most other leaders would have. No matter what the destination, my style as CEO is to steer Union Square Hospitality Group along a route that represents a balanced quest for safety, for thrills, and, mostly, for taking the road less traveled. I tend to view new business opportunities as chances to explore and learn, rather than as a license to expand the company without limits, at any cost. I’m not hell-bent on opening the greatest number of restaurants we
are capable of operating. That would feel reckless and would make it nearly impossible for a company whose success is based on meaningful human interaction to retain its soul. I am not too interested in making deals just because we can make them. Since there will never be more than twenty-four hours in a day, the careful choices I make about how to spend that time determine the style with which my colleagues and I will spend it.
I have always believed that you can tell as much about a company by the deals it does not make as by those it does. Much of the success we have had has resulted from saying
“no, thank you” to opportunities that, while initially compelling, would not have been wise to pursue. In fact, by avoiding some potential mistakes, I sometimes wonder whether we’ve made much more money by choosing the right things to say no to, than we have made from those things we’ve chosen to say yes to. I often try to measure the money we haven’t lost and all the quality and soul we haven’t squandered. There is much to learn by understanding what goes into a “no” decision, and there’s an art to analyzing the deals you don’t make.
Over the years, we’ve declined some amazingly generous offers to create restaurants in casinos, chic hotels, upscale shopping malls, train stations, sports stadiums, airports, and office buildings. Many decisions to decline have been primarily driven by our own sense that the framework within which we’d be doing business just didn’t feel right. It’s similar to a gallery owner who, having first selected a wonderful piece of art, must not only take exceptional care to frame, hang, and light it in the most careful, appropriate way, but also to ask the most important question: Does this piece of art even belong in this gallery? To make such decisions with confidence and clarity involves knowing who you are, and precisely what your product or brand represents for your stakeholders. Even when the context feels right, before entering into a deal I also make a very careful “gut check” of my own sense of personal balance, knowing that a new project will challenge me (and my colleagues) in every possible way.
Sometimes my senior team and I make as many as fifteen exploratory forays to learn about a new venture that we eventually don’t undertake. Each step is a process of learning about the specifics of the deal and—even more—an opportunity to “try it on for size,” to see how saying yes would feel. Too many people throw themselves into a deal
without considering whether or not their business actually needs the deal or should be undertaking it in the first place. In the process of exploring a new venture, we make repeated visits to the prospective site; meet with the landlords, developers, or prospective partners (in their office as well as ours—since you can learn a lot by seeing and feeling how people conduct their own business in their own environment); get the flavor of the surrounding community (thinking ahead about what role we might one day play there); and assess our prospects and capacity for fielding a winning staff.
THE “YES” CRITERIA FOR NEW VENTURES
- The opportunity fits and enhances our company’s overall strategic goals and objectives.
- The opportunity represents a chance to create a business venture that is perceived as groundbreaking, trailblazing, and fresh.
- The timing is right for our company’s capacity to grow with excellence, especially in terms of our having enough key employees who are themselves interested and ready to grow.
- We believe we have the capacity to be category leaders within whatever niche we are pursuing.
- We believe our existing businesses will benefit and improve by virtue of or notwithstanding our pursuing this new opportunity.
- We feel excited and passionate about this idea. Pursuing it will be an opportunity to learn, grow, and have fun!
- We are excited about doing business in this community.
- The context is the right fit. Our restaurant and our style of doing business will be in harmony with its location.
- An in-depth pro forma analysis convinces us that it is a wise and safe investment.
The greatest source of entrepreneurial inspiration for me has always been my rich storehouse of personal memories and interests, from which I draw ideas for new business ventures. For instance, I have always loved sports—and I continue to follow every game of my hometown team, the St. Louis Cardinals. It has occurred to me from time to time that there might be something to add to the quality and kinds of food available at sporting events, a category which has certainly improved since my youth, but which still has a long way to go. There must be an enormous number of people who love both sports and good food. Why should the two be mutually exclusive? And a little more hospitality at the ballpark certainly wouldn’t diminish a fan’s enjoyment of the game.
Now that our company has begun to gain experience in the kind of businesses—off-site catering, burgers, hot dogs, frozen custard, barbecue—that could easily be adapted to a sports stadium, I’d be willing to listen carefully if the right opportunity to do something distinctive in this niche presented itself at the right time. Sports are entertainment, and so is eating out. An excellent food experience can enhance the fun of watching your favorite team win, and even take some of the sting out of a defeat.
One of the more unusual business opportunities I’ve seen was actually presented to us by a house of worship, asking if we might be interested in opening a café on its premises.
Manhattan has a number of beautiful old churches sitting on prime real estate. In recent years many have apparently gone underutilized, with fewer people attending church regularly. Churches often have a next-door auxiliary building that can be used as a community center or reception hall.
The idea was to create a popular, well-run café in the adjoining space as a means to entice more people to come to worship and to realize some income for the congregation. The church was in the same neighborhood as our restaurants, and the proposal was definitely worth at least one meeting because it satisfied both our community and our “groundbreaking idea” criteria. But there was no need to go forward. Where would it lead? Which of our staff members would find this a satisfying move in their careers? Where was our passion for operating a church café?
We have considered very lucrative proposals whereby we would open a second unit of one of our existing restaurants in another city, such as Las Vegas, Miami, Atlantic City, or Tokyo. From a short-term financial standpoint it has been frustrating to turn down some of these proposals, but either the timing or the context discouraged a “yes.” For instance, the underlying premise of Las Vegas—the world’s most successful marketer of illusion and fantasy—makes it an improbable context for an authentic restaurant possessing soul. Since we have built our company’s long-term success in New York on a foundation of a genuine sense of place, rather than by selling illusion, those options didn’t feel like the proper context. This has been particularly true of our restaurants named and created explicitly for their locations. Union Square Cafe, Gramercy Tavern, and Eleven Madison Park are not concepts. They are restaurants of, by, and for their communities. It’s important for me to understand that and act accordingly.
Of course, there may yet come a time when the context, timing, and value feel just right for us to open something in Las Vegas, or perhaps in Tokyo, whose restaurant-going public seems to adore all things “New York.” For example, I would not rule out opening a Blue Smoke or Tabla in Las Vegas. For me, that context feels more appropriate for a restaurant with a strong theme. After all, opening a barbecue restaurant and an Indian fusion restaurant in New York required a certain culinary poetic license; doing so in Las Vegas would be no different. And the challenge could be thrilling. But I would have to be very careful before going forward. I would first have to believe that, say, Blue Smoke was on a very solid, steady course at home in New York.
Next I’d need to feel confident that our organization had enough depth, and enough managerial and culinary capacity, so that I would not have to be the one traveling continually to Las Vegas or Tokyo or London or wherever. If I were to do that, I would be putting into jeopardy not only my sense of corporate balance, but also my sense of personal balance and my preference to spend as much time as possible with my family.
Another serious consideration is that wherever and whenever we open a new restaurant we must have the talent and capacity on all levels to meet our guests’ expectations for high quality. And if our existing businesses are not constantly improving, then expansion loses all of its merit. Think of a balloon: it isn’t really a balloon until it’s inflated, but as soon as you blow too much air into it, it’s going to pop. Having seen firsthand the consequences when my father expanded his business too rapidly, I am wary of blowing too much air into our balloon. Often, when businesses fail in our industry it’s because of too much expansion; quality suffered and the organization couldn’t handle it.
As my company’s leader, I have certainly learned to be decisive with an appropriate sense of urgency, but I always prefer to make my decisions after first building consensus among various colleagues, whose unique vantage points give me further confidence to move forward. This process can be lengthy, but so long as the spirit of any decision is consistent with what I’d want, bringing others’ views to the table allows us to move forward with a more fully realized plan supported by those who are responsible for its execution. Our decision-making about whether or not to pursue new deals is always sharpest when I call on members of my advisory board to advocate on behalf of their primary role in our company.
First I call on our senior vice president of strategic business development, David Swinghamer, as our “secretary of the future and forward movement.” He is our minister of deals; and he is especially gifted at imagining, structuring, designing, and developing new projects. He also creates and analyzes financial models and pro formas. I rely on our senior vice president for people, Paul Bolles-Beaven, to tell me if we have the requisite depth of human capacity and essential training systems we’ll need for more growth.
Our senior vice president of operations, Richard Coraine, is my secret weapon for assessing whether we can actually execute a plan. He knows what it takes to make things work at the level of excellence expected from us. Our culinary senior vice president, Michael Romano, who excels at carefully figuring out the specifics of any recipe, helps to stop a half-baked plan, contributes essential know-how to kitchen design, and contributes his wise culinary counsel to ensure that what we end up with is delicious.
I meet with this “kitchen cabinet” for ninety minutes every Tuesday morning to discuss and debate the strategic direction of our company. We also include our chief adviser
and “wisdom keeper,” Richard Goldberg, a penetrating thinker and brilliant teacher who assumed that role for us after his retirement as a partner at the law firm Pros-kauer Rose.
Also at the table is Jenny Dirksen, our director of community investment, who’s there to take minutes to assure that we follow through on agreements and do what we say we’re going to do. She is our “agenda keeper.” Each participant may initiate and “own” a weekly agenda item so long as he or she relays it to Jenny by the end of the previous week and provides the rest of us with any supporting collateral materials so we can prepare for the discussion in advance. As an experienced colleague whose views are valued, Jenny is free to express dissenting, supporting, or new perspectives on whatever it is we’re discussing. These meetings give me a balanced input on decisions I’ll need to make about our company, with the point of view of just about all of our stakeholders represented by a trusted associate.
Even after all the business aspects of a prospective new deal are discussed, dissected, and examined, I always call on Audrey, who, as my “secretary of life balance,” generally has an opinion as to whether a presumably good business decision is or isn’t a good thing for me and our family.
Audrey is the first to notice when I’m out of balance, and call me on it. She knows that I tend to approach a new opportunity the way mountain climbers assess another mountain. It’s a tempting challenge that may look quite good from afar; but on closer scrutiny, many opportunities are far from good. I’m curious to see the view going up the mountain, and I’m curious to see it from on top of the mountain. One aspect of climbing I especially enjoy is the adventure and challenge of getting to know all the people
with whom I’ll collaborate along the way. Each business journey attracts a new and different group of players—chef, general manager, cooks, waiters, hosts, reservationists, managers, bookkeepers. The joy I derive from creating something new with a fresh ensemble is a major part of what I enjoy about growth. I also check in with a small group of longtime trusted friends and mentors before I make a decision. Many of them are acquaintances and even customers, and some have become investors in our new restaurants. Their business perspectives and expertise have often proved indispensable. They also know me well enough to call me on the carpet when that is warranted—always doing so out of a sense of support, and with respect. I’ve taken great care to surround myself with highly capable people of integrity, each of whom brings something different to the table, and often something I am lacking. “What are you thinking?” is neither an uncommon nor an unwelcome response to some of my unbridled dreaming.
It’s David’s role to explore and help create new business ventures that are true to our strategic vision and to further the dialogue with a prospective business partner. If things advance to a second conversation, David and I then discuss the project with our other partners, who most often shoot holes in it. Michael brings thoughtful balance to this group, being somewhat risk-averse and highly analytical. Richard Coraine is the ultimate realist. He knows what it takes to launch a new business, and he doesn’t mince words. He also knows food and wine and lives for the tireless discovery of the best. He’s actively involved in the selection of chefs and general managers. He’ll most often stick to his guns whenever our growth seems to outpace our ability to execute at the highest levels of quality. After all, when something goes awry, he and his operations team will be the ones most responsible for fixing it. Paul keeps us focused on the quality and capacities of the people who
work in our organization, knowing that they are our core strength. He’s the adviser who best knows how much or how little “people depth” we have at any given time. And as the only one of my colleagues who’s been with me since day one in 1985, Paul also has a deep knowledge of what makes me—and us—tick.
I actively seek and benefit from my partners’ input, a process that often generates some healthy tension among us. The conversation is always candid, passionate, and constructive. I carefully weigh all of their views as well as my own gut as I study our options. Making a unilateral decision to grow is not my style, and I believe that such a decision won’t lead to optimum success down the road.
Being in agreement is important so that when we go into the new business, we’ll be a more effective team and better able to excel.
I DON’T REGRET ANY of the “no” decisions we have made, but to this day I have occasional misgivings about passing up an opportunity to create a new restaurant in the Metropolis Cafe space next door to Union Square Cafe in the early 1990s. Even though I am entirely convinced that this was the right decision for our company at the time, it’s about the only deal we passed up that I continue to think of, primarily because I walk by the space nearly every day.
Metropolis Cafe had opened just days before Union Square Cafe in 1985; and more than any other restaurant space overlooking the park, the Metropolis, on the northwest corner of East Sixteenth Street and Union Square West, benefited from the increased development and energy surrounding Union Square. Nowadays, the park is almost always filled with a diverse group of residents,
business people, students, shoppers, theatergoers, and tourists. The Metropolis space fronts directly on the square, and along its long East Sixteenth Street side, contiguous to Union Square Cafe, it has a narrow strip of a terrace that is a compelling place to sit and watch an endless parade of passersby, not unlike a café on the Via Veneto in Rome. Our two restaurants shared a landlord, and I had a neighborly relationship with the outgoing restaurateur, so I was given the opportunity to take a first look. The context and location were ideal; the issue was the timing, which was off by a couple of years. Intrigued though I was, I just did not have it in me then to open a second restaurant. I still wasn’t ready emotionally; nor were we prepared as a business. In 1991 I was still struggling with whether or not I would or should ever expand my company.
Despite any second thoughts about having passed up that space and missing out on operating a bustling, highly profitable café with outdoor seating just off the park, I know I made the right decision at that time. Given our lack of managerial depth at all levels coupled with my own ambivalence, a restaurant in that space would likely have proved problematic. And had I said yes, Gramercy Tavern would never have been born three years later.
Metropolis Cafe was the last remaining great space adjacent to Union Square Park. That frontier had closed, but by 1996, and with Gramercy Tavern beginning to hit its stride, I thought the timing was right for us to begin thinking about the next project. I now knew that the gestation period for one of my restaurants was often three years from initial idea to opening day. I had become determined to be a restaurant pioneer on Madison Square Park, and to take a leading role in that park’s restoration. I remember thinking that creating a restaurant overlooking Madison Square Park
—desolate as it was back then—would be like flying to the moon and planting the first flag.
In order to do a gut check on how much I really want to take a space or do a deal, I always ask myself whether I would do this deal if it were given to me for free. That sounds simplistic, I know, but it works. Believe it or not, my answer to this question is most often “no.”
When Tom Colicchio and I scoured the city in 1993 in search of a location for the new restaurant we were cooking up together (which would eventually become Gramercy Tavern), we went one day to the site of the recently shuttered Coach House Restaurant in Greenwich Village. We walked through the depressing space, which had once been a glorious American restaurant—it received four stars from Mimi Sheraton in the New York Times and was a favorite of James Beard’s. Now it was musty and depressing: there are few things more putrid than the stench of a dead restaurant. After touring the place, we walked across the street, looked at the building, and reflected.
“I don’t think I would want that even if it were free,” I said. Tom wholeheartedly agreed, and we passed it up.
Not long thereafter, Mario Batali and Joe Bastianich opened the excellent and enormously popular Babbo in that very space, creating magic within those walls. Their guts told them that the space was right for their vision. It just wasn’t right for ours.
Selecting a restaurant space is a lot like trying on a pair of new shoes. The style has to be right, the size has to fit, and they have to feel good, or I simply won’t buy them. If I did buy them, I’d never wear them. I’ve declined a significant number of sweetheart deals from developers that
were essentially offered for free. I understand how that resistance can frustrate my partners and investors. But the fact that something is free alone doesn’t make it wise or compelling to proceed.
Also, there really is no such thing as a free lunch. We’ve learned that even when a landlord or developer is generous in offering to contribute some or all of the costs associated with building a new restaurant, there are proprietary expectations to consider that are real and very natural. For example, The Modern is our restaurant, but it must operate in harmony with the overall goals of the Museum of Modern Art. We are prohibited from using our restaurants there for weddings or fund-raisers—two typical sources of profitable business. Eleven Madison Park and Tabla are also our restaurants, but they operate with sensitivity to the business goals of the mammoth office building (headquarters of Credit Suisse) in which they are housed.
We must keep the building informed of every new initiative we undertake, and sometimes our business is affected by its needs. For example, after 9/11 the building increased its security, and we had to decrease the serving area of Tabla’s outdoor patio to accommodate a huge concrete planter constructed to prevent a wayward vehicle from penetrating the building.
I don’t take a “rearview mirror” approach to life.
Generally, I drive looking straight ahead. But I do try to spend time analyzing the wisdom of choices I’ve made not to go forward with new ventures; and that analysis requires abundant self-awareness and some hindsight. There are a handful of difficult “nos”—projects that I thought would have been the right fit for our company but that presented themselves at the wrong time. Other assessments have led me to conclude it was the right time for a project, but the wrong fit. A yes decision has to meet both of those criteria.
My regret isn’t that I came to the wrong conclusion, but that I made a difficult, though correct, decision about what our company needed at a precise moment in time.
I remember the difficult decisions my colleagues and I made to decline opportunities to open restaurants at the W Hotel and the Gramercy Park Hotel in Manhattan. In 1997, just as Starwood Hotels was planning to launch its new “W” brand, senior executives reached out to us to discuss creating the restaurant for their first W Hotel in New York, on Lexington Avenue and Fiftieth Street. I had three core concerns. First, the timing was definitely wrong. These discussions took place while we were in the process of conceiving and designing Eleven Madison Park and Tabla.
That double project alone had forced me to question whether or not I could maintain excellence at my two existing restaurants while simultaneously opening and operating two new restaurants at 11 Madison Avenue. Some people already thought we were crazy to be opening two ambitious fine-dining places at once, so adding another new project—no matter how exciting—would have been mad. It would take attention, focus, and time to develop the kind of soul necessary to make the two new restaurants into great restaurants. I didn’t feel we needed another project.
The second issue was location: I was still insisting that I needed to be able to walk to each of my restaurants from home within five minutes. (The first exception I made, and only after nineteen years, was for the opportunity to create a restaurant and cafés for MoMA.)
The third issue was context. Here I was thinking of the W Hotels brand itself. The Starwood executives I met were extremely effective at communicating how they would position their new brand. What they described was a trendy, hip, s*xy, more youthful version of a Four Seasons hotel.
They were out to attract high-end, experienced travelers looking for a bit of nightclub in their hotel experience. But anytime I hear or sense “trendy” (as opposed to “enduring”) as an important aspect of what’s going on, my antennae go up. It all comes down to knowing what you stand for and putting your product in the proper context. None of that description sounded like any of the restaurants I had opened to date, and so we passed up the offer. Neither the timing nor location nor the context fit.
In 1999, not long after we’d opened Eleven Madison Park and Tabla, Starwood’s developers approached us again, this time about creating a restaurant for their next big W Hotel, to be situated in the renovated landmark Guardian Life Building, just off Union Square. The timing now felt right, the location was perfect, and the W had successfully realized the initial, very hip vision of its brand; but the context still didn’t pass my gut check. Tabla, whose sensuous flavors and décor were attracting a dynamic clientele, might have been an apt concept, but we had just opened it eight blocks to the north. Once again, we passed up the offer.
In 2004 we were invited by the hotelier Ian Schrager (then the owner of the Royalton and the Hudson Hotel in New York and the Delano in Miami) to open a restaurant as part of his very upscale renovation of the Gramercy Park Hotel. It overlooked another gorgeous park in New York, and it was a tempting opportunity. David Swinghamer and I knew we should closely examine its context, timing, and value for our company. The hotel was about as centrally and perfectly located as anything could possibly be, directly across the street from Gramercy Park, just blocks from our office and five of our restaurants, and a stone’s throw away from my home. Given our history of wanting to connect restaurants with parks and to be on parks, we met twice with Schrager. He lavished praise on our restaurants and
discussed the generous business terms he had in mind, which were impossible to ignore. I sat there thinking, This will be a huge, lucrative business for someone. How can we not do it?
Schrager, famous for having founded Studio 54 in 1977 with the late Steve Rubell, described his vision for his new hotel as a “downtown version of the Pierre,” a classy grande dame of a hotel that overlooks Central Park, and said he was ready to create his own enduring legacy—one that would be a perfect context for the kind of “New York institution” we were known to create.
Still, I was wary. “I want to make sure that we’re not putting a trendy frame on a traditional painting here,” I told him. “You may say you want nothing more than to have our painting hanging in your hotel, but as much as I admire your style, it’s quite different from ours.”
“You’ve got to trust me,” he said. “I’ve changed. No more Page Six. We’re going for a low profile. For quality. This is going to be my masterpiece. I’ll even share the bar business and give you the banquet opportunities for your new catering company. Trust me. You are perfect for this.” He was beginning to be convincing.
By our ballpark calculations, he was handing us a potential $12 million business. I was almost willing to ignore my gut and take a leap of faith on the context, considering how effectively he had addressed all our concerns.
Against that temptation, I spent a week arguing with myself: This is a born-again Ian Schrager. He’s no longer interested in hot places, not interested in the New York Post’s Page Six. Not interested in paparazzi and gossip. His company has upscale hotels all over the world. He says he
wants to do something of substance that will stand the test of time. That’s precisely why he’s calling us. If he merely wanted to create a hot new restaurant, he could have called any number of other restaurateurs all over the world with whom he has relationships. They would say yes in a heartbeat.
The deal was favorable. David wanted us to explore the strategic fit: would there be abundant banquet space that could be served by our forthcoming new company, Hudson Yards Catering? Paul wondered if the new restaurant would provide growth opportunities for any of our top staff members, and, as importantly, whether or not we had enough of them to go around. Was anyone on our team ready to be promoted to chef or general manager? Looking ahead, would anyone be prepared in thirty months, when the hotel was to open? Audrey had another wise question. Perhaps this restaurant was too well located: “Do you really want to walk right by your restaurant every morning and night as you walk the dog and take the kids to school? You’ll never get away from it.” Also, Schrager’s restaurant would butt up against the enormous project we had just undertaken at the Museum of Modern Art. Even though the hotel opening would be nearly three years away, we were so involved with the launch of our MoMA restaurants that there wasn’t even enough time or mind space to dream. Saved by timing! It kept me from soul-searching over whether the context was truly right. Tempting as this offer was, we passed it up.
There’s another kind of “road not taken”—a decision that falls between a definitive no and an unequivocal yes. A potentially excellent venture may not be something we should pursue at the time of the offer, but might very well become right in due time. For example, JetBlue Airways approached us to get into the business of airport food
kiosks. It was worth listening just for the opportunity to learn more about an engaging company whose culture of excellence and employees-first hospitality seemed so closely aligned with ours. The JetBlue officials explained that the opportunity had enormous growth potential, given the significant amount of “dwell time” travelers now spend in airports because of the increased security after 9/11, and because the airline does not serve passenger meals. The sales potential appeared quite large. “We love your restaurants,” their people told us. “We love the way you do business. It feels consistent with our culture. We want to be on the cutting edge of this business and we’d like to talk to you about it.”
We were delighted to meet them at their hub, John F. Kennedy International Airport, and take a good look at their blueprints and plans for their terminal. But once again, the timing wasn’t right for us. With a year to go before opening at MoMA, we were entirely focused on that project and lacked the additional organizational capacity we’d need to succeed at this new opportunity. But by exploring it, we did realize that the time might come someday for us to venture into the airport food business. The risk in saying “not yet” is that an opportunity could be taken by some other, more prepared company. Still, our hope was that if we built a solid relationship with JetBlue and did not put our reputation for (and ability to deliver) quality in jeopardy, some aspect of the opportunity might one day jibe with our own timing. I trusted that there could come a time when we would have the operational, tactical, and human capacity to pull it off, especially since we were just about to build a large off-site kitchen facility for our Hudson Yards Catering venture. (Hudson Yards was a logical outgrowth of our deal with the Museum of Modern Art, for which we were to become the “preferred caterer.” It also made sense to launch an off- premises catering business as an effective and profitable
way to extend our brand of culinary excellence and enlightened hospitality into the off-premises event niche.)
Moreover, we were developing businesses—Blue Smoke, Shake Shack, and Cafe 2—that could be adapted smoothly for airport terminals. There might even one day be a way to open a Bread Bar concession stand for Indian “street” food, or to create something new from scratch that would effectively add to the dialogue on how food is viewed and enjoyed in airports.
Timing is everything. There is an important art not only to determining whether one should or should not go into a deal, but to knowing whether one might want to go into such a deal somewhere down the road. Especially in cases where timing was the decisive factor in not making a deal, there is value in remaining in close contact with the potential future partner. While it’s true that today’s potential business deal may later evaporate, it also may one day evolve into something bigger, better, and more richly textured. Patience has its rewards.
I want to expand our company on my own terms. My unwavering, long-term vision of our company is that everything else is subsidiary to context—no matter how seductive a prospective deal may appear. In the early 2000s, we were shown plans for, and briefly flirted with opening, a restaurant in Manhattan’s enormous Time Warner Center at Columbus Circle. One fundamental issue was that a number of other elite dining establishments would also be opening there. That clustering of excellent eateries was the reason developers felt the complex would be so successful—they believed the restaurants would constitute a critical mass. But I didn’t feel especially
comfortable joining a collection of great restaurants in a Manhattan shopping mall, no matter how beautiful it was supposed to be.
In almost every way, the opportunity at Time Warner didn’t feel ideal for us. First, beyond my own personal preferences, I believe that other New Yorkers also prefer to dine out at street-level restaurants that are themselves destinations, rather than being ensconced in higher floors of a shopping center. Second, the mall itself, and peoples’ experience of going to the mall, was not a frame that seemed right or would add any value for any restaurant that we might open there. Third, opening in the Time Warner Center would not have marked any kind of growth or evolution in the kind of company we are: There was no true community to engage (with the possible exception of Jazz at Lincoln Center), and there was no niche we could creatively fill. It was a deal I knew we didn’t need.
I became convinced that I was making the right decision the day I drove my daughter Hallie, who was then eight years old, home from a weekend soccer game. In slow traffic, we inched by the Columbus Circle site, which was then just a deep construction pit. “What would you think,” I asked Hallie, “if Daddy opened a restaurant there?” She stared over at the hole in the ground. “Why would you open a restaurant in there?” she asked.
“Oh, it’s going to be a beautiful new building,” I explained, there’s going to be a fancy hotel (the Mandarin Oriental), a beautiful jazz hall ( Jazz at Lincoln Center), and a big TV station (CNN) is going to be there too. A lot of people who like restaurants will live at the top, in a really tall apartment building. There are going to be all kinds of nice shops, a grocery store, a gym, and they’re going to have four or five other great restaurants there.”
With that, Hallie burst into tears. “I never want you to have a restaurant where people are going there for some other reason than to go to your restaurant. People go to your restaurants because they want to be at your restaurant,” she said.
That day, I added Hallie to my list of unofficial advisers. I knew she was right. It was her wise way of telling me that the context would not have been right for our company.
Context, context, context! For years, I had heard the business mantra, “Location, location, location”—the idea that success in retail hinges on choosing the perfect address. However, my experience has shown that context is an even more critical factor. Consider Tiffany’s iconic blue box. It’s the context that sets expectations for what’s inside. While the gift itself may vary, it must align perfectly with the promise of something worthy of that box. The blue box elevates the perceived value of its contents, just as the contents reinforce the significance of the box. That’s not about location—it’s about context!
Not long after, I shared with Hallie details about another venture—this time at a location where thousands would gather for reasons unrelated to dining. Unlike before, ours would be the only restaurant at the site. We’d have our own entrance for guests and an opportunity to contribute meaningfully to the conversation about dining for visitors who were already coming to the venue.
In many ways, opening The Modern and two visitor cafés at the Museum of Modern Art was the biggest gamble that I’d ever undertaken, and a test of my organization’s core business values and competence. But if ever there was a case to be made for growing and stretching, this was it.
We’d be in very new territory in terms of concept, context, and complexity. If we could pull this venture off, it would open unimaginable new doors of opportunity for our business.
