How Shake Shack Scaled Without a Playbook

“We broke a lot of rules because we didn’t know what the rules were.”

In 2010, Shake Shack was not a brand. It was barely a company. Three locations. No playbook. No one in the room who had ever scaled a quick service restaurant before.

Food for the original Shake Shack was being prepped across the street inside the kitchen of the fine-dining restaurant 11 Madison Park. General managers sat in meetings with notable chefs from The Modern and Gramercy Tavern. Not exactly the traditional incubator for what would become one of the most recognizable burger brands in the world.

It was messy. It was unconventional. And it turned out to be the perfect starting point.

Andrew McCaughan, now Chief Development Officer of Shake Shack, joined right in the middle of that chaos. Fifteen years and 645 locations later, he sat down with RestaurantSpaces founder Michael Owens to reflect on the unlikely path from a single park kiosk to a global brand. What he shared was less about burgers and more about risk, systems, speed, and the consequences of learning everything the hard way.

The Origin Story

Most people assume Shake Shack was always destined to scale. It was not.
It began as a public art project. Restaurateur Danny Meyer, founder of Union Square Hospitality Group and one of the most influential figures in modern hospitality, opened a simple hot dog cart in Madison Square Park to raise money for the park conservancy. It took off. Lines formed. The cart turned into a kiosk. But even then, the idea was never to build a chain.

At the time, as McCaughan explained, Danny Meyer had only ever opened one of a kind restaurants. Concepts like Union Square Cafe, Gramercy Tavern, and barbecue spot Blue Smoke were his world, not scalable chains.

Operations lived inside the Union Square Hospitality Group ecosystem. The Shake Shack team borrowed systems, talent, and thinking from the fine dining world simply because that was the only world they knew. The result was a team of highly trained people building a fast-casual concept with fine-dining instincts.

They were not following industry rules. They were breaking ones they did not even know existed.

And that became their advantage.

The Three Eras of Shake Shack

McCaughan broke the company’s growth into three distinct chapters. Each one shaped not just the brand, but how the entire organization thinks about scale, risk, and discipline.

Era One: The Experimental Years (2010 to 2015)

After raising $25 million in 2009, Shake Shack did not take another dollar of outside capital until it went public in 2015. During that stretch, a team with zero quick-service experience kept opening more restaurants at an accelerating pace. Eight one year. Thirteen the next.

They went public with just 40 locations. For a brand still finding its footing, it was a remarkably early IPO.

At the same time, they were already pushing into global licensing markets like Dubai, London, and Japan, all while still trying to figure out how to operate consistently in the U.S.

It was growth driven by instinct more than infrastructure. The speed was thrilling.

The complexity was hidden. The discipline would come later.

Era Two: Scaling Up (2015 to 2020)

By 2019, Shake Shack was opening 39 company-operated restaurants in a single year. But beneath the momentum, the model was still evolving. Kitchens kept changing. Designs were constantly tweaked. Every restaurant was essentially still treated as a one-off.

Then COVID arrived.

With roughly half of its footprint in highly restricted markets like New York, DC, Chicago, and Los Angeles, Shake Shack was burning through millions in cash each week. New development shut down entirely. Everything stopped.

Era Three: The Pivot (2020 to Present)

After raising $150 million in fresh capital, the company faced a reckoning. Digital sales had been just 12 percent before the pandemic. Overnight, they surged to 80 percent. The operating model flipped.

McCaughan remembers sitting in his CFO’s backyard during COVID with a blank sheet of paper, sketching what the future might look like. “We wrote down our format strategy on a piece of paper,” he said. “We said we had to build a drive-thru, add a digital pickup window, all of it. Then we just started building them, kind of not knowing what we did not know. We did not know how hard drive-thru would be or how much we would have to change in the back of house to execute at that level.”

That willingness to move forward without perfect certainty became the foundation for the next phase of Shake Shack’s evolution.

The Drive-Thru Challenge

Here is the paradox. The toughest drive-thru moment at Shake Shack is not when it is slammed. It is when a guest is the only one in line.

Traditional quick service rewards speed above all else. But Shake Shack still cooks fresh burgers to order. That process takes three and a half minutes. When you are the only car waiting, those minutes feel longer.

The solution turned out to be communication.

Teams are trained to greet guests immediately and explain the situation. “Hey Michael, we are so excited to have you. We are putting your burger on the grill. It is going to be about four minutes. I just want you to know that before we check you out.”

That simple transparency changes the entire experience.
Even with drive-thru expansion, about half of Shake Shack guests still choose to dine in, far higher than most QSR brands. And that is exactly how they want it.

“People want to sit down in a Shake Shack,” he said. Guests come for the food, the experience, the music, and the ability to grab a beer or glass of wine with their burger.

Nailing the Prototype

For the first time in the company’s history, Shake Shack has fully standardized its restaurant prototypes.

McCaughan’s team meets every other week with operators, engineers, and technology leaders. They committed to two core building footprints, a limited set of kitchen layouts, and a disciplined process for any future changes.

The impact was immediate.

After opening two locations in Phoenix, a senior construction manager pulled McCaughan aside in disbelief.

“Andrew, they are the same building.”

“That is the point,” McCaughan replied.

Standardization, however, does not mean sameness. The design team now works from a refined kit of parts that allows spaces to feel custom while staying operationally consistent. Green remains the signature color, a nod to Madison Square Park and a clear break from the sea of QSR reds and yellows. The idea of a Shack within a Shack still defines the brand.

At the end of the day, McCaughan believes guests remember only a few things.

“What matters is the team and the people and the food and the community,” McCaughan said. “That is what people remember, that you had an amazing burger and you were taken care of.”

Innovation Through Partnership

One of Shake Shack’s most underrated growth engines has been its licensing partners. Instead of simply replicating the U.S. brand abroad, many partners became real-world testing labs.

When Shake Shack began exploring full-bar concepts, licensed locations had already been experimenting with cocktail programs in airports and at resort destinations such as Atlantis in The Bahamas.

Those experiments paved the way for Shake Shack’s first company-owned full bar at The Battery in Atlanta. The 5,000 square foot space features premium cocktails, including an espresso martini milkshake, plus a walk-up window that allows guests to take open container drinks outdoors. A similar bar concept is now planned for the Las Vegas Strip.

The Technology Evolution

Forget robots flipping burgers. McCaughan sees the real automation opportunity elsewhere.

Most locations now operate four to seven self-ordering kiosks, and guest adoption has surged. These kiosks drive personalization, recognizing returning customers and remembering preferences. More importantly, they free up labor.

Where did that labor go? Straight into hospitality.

“Being a cashier is hard,” McCaughan said. “But bringing a tray of burgers to people when they are hungry, and helping them get everything they need, that is what it is all about.”

Behind the scenes, Shake Shack is also deploying AI-powered cameras to analyze guest flow and table utilization, building AI estimation tools for construction teams, and consolidating its data strategy to drive smarter labor scheduling and demand forecasting.

Lessons from the Journey

Looking back, McCaughan sees one core opportunity he would change.

“I would have tried to get a little sooner with our operations team and our culinary team to say, ‘Hey, how can we create one right way?’” McCaughan said. “Managing all the different iterations and the changes causes a lot of trouble, not only from the build standpoint but from operating, maintaining, and moving managers between locations.”

His advice to emerging brands is simple but difficult.

Create radical alignment early. Systematize before you scale. And do not underestimate how many problems standardization quietly prevents.

What worries him most today?

“From a development standpoint, it is just permitting,” he said. “The permitting environment has gotten worse. It has not recovered from COVID. Cities are under-resourced…it is still tough.”

Still, the arc of Shake Shack’s growth stands as a case study in how to evolve without losing soul. From rule-breaking beginnings to disciplined modern systems, the brand learned to pair creativity with structure. For restaurant development leaders navigating their own scaling challenges, McCaughan’s journey from three locations to 645 is proof that clarity often comes only after chaos.

The Personal Touch

After all these years and hundreds of openings, McCaughan’s favorite menu item remains unchanged. Shack Burger, add pickle.
His favorite location? The first Shake Shack in LA, on Santa Monica Boulevard in West Hollywood. It was their first location in California, opened shortly after the company went public, and represented a major career milestone for him.

Watch the full discussion below: 👇