Insight
Narang: POS integration alone cannot sell commodity add-on products
“It's not good enough to just build commodity products because it's integrated on the point of sale.”
Insight
Narang: Managing and running a startup fundamentally gets easier over time
“Yes, for sure. I mean, I think, There's always new challenges, but it does, I think, fundamentally, you know, get easier.”
Assertion Supported
Narang: Toast had to halt sales early on due to product stability
“Ah, for toast, we made a bunch of starts and stops there. In fact, there were these times where I remember, and you can imagine, right, you're like trying to raise capital and grow, and having a meeting, we're like, well, we need to stop selling. It's like, wh…”
Disclosure
Narang: Nearly all early Toast hardware was returned within 90 days
“I mean, I remember there was one time when we were shipping out hardware to restaurants, every piece of hardware, like close to, it felt like every piece of hardware that we shipped came back in 90 days, and we're still selling it because we're like, we need t…”
Insight
Narang: Processing payments enables superior small business credit risk assessment
“And what we realized was, because we're the payments partner, We could do a better job of assessing risk. We could make the process of getting the loan out, you know, really simple.”
Assertion Partly supported
Narang: Toast mandates all new sales hires sell directly for one quarter
“Everyone that joins the company, whether you're an IC, a BDR you know, outbound prospecting, or a rep closing deals, or a manager, you have to go sell. If you're a district manager, it's great that you've managed people before in running sales team, but you go…”
Insight
Narang: Founders should refrain from raising too much capital
“Don't raise too much capital. I think there's all this perspective where we've got plenty of runway that's healthy, that's good. On the other, on the one hand, like, you know, VCs aren't stupid. So if you're gonna raise too much capital, you get diluted early …”
Insight
Narang: Refusing to delegate to domain experts is a major founder mistake
“And one of the mistakes most founders make is you don't want to give up any control because you're like, well, I need to know what the heck's going on. And the reality is you can benefit from people that are domain experts and specialists in specific areas, bu…”
Disclosure
Endeca founder Steve Papa wrote Toast's entire $500K angel round
“I remember we did, like, eight or 10 VC meetings, and maybe we just were naive, and, like, everybody said no, and so one of the big yeses was the founder of Ndeca, right, who wrote the whole check. He wrote, like, a half a million dollar check, and At what pri…”
Insight
Narang: Founders underestimate practical engineers who build with high velocity
“At Indeca, I met Steve and John, and you know, these were these proverbial TEDx engineers, which I think people underestimate. You need people that can build with velocity and are practical.”
Insight
Narang: 80% of upfront product problem permutations are irrelevant
“In product management, one of the things I find is there's so much work that happens to describe all of the permutations of the problem when you realize, like, 80% of those are not relevant, or at least not relevant now.”
Disclosure
Narang: Early Toast refused to hire management to rely solely on founders
“So I had zero value for management early on. I just wanted to hire people that could sell, that could code, that could, and that's it. And I was like, I'll do all the management. Steve will do all the management. We don't need any other managers.”
Insight
Narang: Generational companies require both specialists and entrepreneurial generalists
“And so there's this balance, I always say, like, you want to have a company that's got a balance of, like, specialists and entrepreneurs, and so one of the things I love is this, and actually Chris, our old CEO, brought this to us, this is the Zones to Win boo…”
Insight
Narang: Hire specialists over generalists only when ready to scale
“Recognizing when you can put the pedal down is really important in companies. And so when you start to put the pedal down back to your question, that's when you, I think you can really benefit from the specialist because I've got muscle memory and I've seen gr…”
Insight
Narang: Direct customer signal matters more than a theoretically grand idea
“And like one of the learnings for me and for the team was, you know, oftentimes you think of like startups and it's like, well, what's the Tenex idea? And like rebuilding POS does not sound like a Tenex idea. But getting signal from customers is like a good si…”
Insight
Narang: Startup products must be both cheaper and better than incumbents
“No, it's not just cheaper. It's gotta be cheaper and better.”
Insight
Narang: Functions moving too far ahead of infrastructure breaks scaling companies
“And so one of the expressions I've heard is like, you've got to make sure in an organization, everything's kind of in sync and something can be ahead of another thing, but it can't be so far ahead. That the whole thing starts to fall apart.”
Assertion Supported
Narang: Toast was at $2 million ARR when bringing in external CEO
“No, it was like two million ARR, pretty early. Yeah, two years in.”
Disclosure
Narang: Toast turned down Urban Outfitters' request to build retail software
“Like I remember one of our early customers was this I think it was Urban Outfitters. They had other restaurants in their retail stores. And they wanted us to do that. You're doing such a great job, do all our retail. And I'm glad we said no, right? And really …”
Assertion Not checkable as stated
Narang: Toast chose Android over iOS simply because it seemed easier
“One of the things that was a crucial decision that we made was we built this platform on Android versus iOS, and it was not, in hindsight, it's like, feels like a strategic decision, but in reality, it was simply because we thought Android was an easier platfo…”
Opinion
Narang: Software, not fintech, is why customers choose Toast
“Customers care deeply about our software. That's why they picked Toast. Found it fundamentally. So maybe, maybe that's what I'll say.”
Insight
Narang: Point of sale is a restaurant's central nervous system
“I've got point of sale, I've got payments, I've got a loan, I've got online ordering, I've got scheduling, I've got inventory, I've got gift cards, loyalty, a website, and all this stuff has to integrate in some way to the point of sale, because that's the cen…”
Assertion Supported
Narang: Toast processes $160 billion in annual transaction volume
“The fintech business, for example, we've processed like a hundred sixty billion in volume every year”
Disclosure
Narang: Toast requires its POS platform to remain central in all acquisitions
“That's the one rule that we've kind of stuck to, which is the central nervous system has to be toast.”
