What It Takes to Build Software for 171,000+ Restaurants | Aman Narang
Summary
Toast built a $20B restaurant OS by thinking like Netflix—using data to personalize menus, optimize yield management, and fill capacity slots dynamically. CEO Aman Narang emphasizes that restaurants lack basic yield optimization despite being fixed-cost businesses, creating massive opportunity for software-driven operations.
Key Takeaways
- Apply personalization logic from consumer tech (Netflix) to B2B restaurant operations—servers should know customer preferences, allergies, and ordering history to make intelligent recommendations, mimicking how streaming platforms predict content.
- Restaurants have no yield management framework despite fixed costs. Toast capitalizes on this gap by analyzing demand patterns, weather data, and inventory to intelligently fill slots across delivery, pickup, and in-store channels.
- Build from first principles: 'If restaurants didn't exist and we had today's tech, we wouldn't build them like this.' This mindset drove Toast to become an operating system across all business facets, not just a payment processor.
- Maintain founder capital discipline and frugality at scale ($20B valuation). CEO still prioritizes operational efficiency and avoiding vanity spending (sponsorships, naming rights) because Toast is fundamentally B2B-focused, not a brand company.
- Surround yourself with good people—co-founders, spouse, and team. Aman credits success partly to being 'surrounded with good people' and having selfless family support, which enabled long-term focus on building rather than short-term distractions.
Related topics
Transcript Excerpt
Remember cable TV back in the day >> versus Netflix today? >> Like Netflix turns kind of knows what you want to watch. Why shouldn't that be in restaurants? Why shouldn't the server of course know your name and then know what on this menu you're going to care about, like what your allergies are, what your preferences are, and then use that to actually recommend stuff. Like if you were building a restaurant today, imagine no restaurants existed. We wouldn't build it like this given the tech we have today. Totally right. Let's go look at your demand patterns. Let's go look at the weather anytime you've got slots open. What are ways in which we can fill those whether it's for delivery or pickup or in store because they've got all these fixed costs. Restaurants are one of the few categories wh…