Toast: Aman Narang. How a Long Wait for the Dinner Check Launched a $2 Billion Business.

Key takeaways

Understanding when to pivot based on customer feedback and product performance is crucial.
Persistence is essential when facing investor rejection and technical setbacks, especially in traditional industries like restaurant technology.
Building purpose-built, integrated solutions for specific markets can create a competitive advantage over horizontal or legacy systems.
Deep customer obsession and agile iteration are vital for developing reliable products that solve real problems.
Leadership transitions and operational scaling require thoughtful management; external challenges like COVID-19 demand rapid innovation and adaptation.
Success often involves a mix of hard work, team dynamics, timing, and serendipitous opportunities.

Summary

The Origin of Toast and the Inspiration from a Frustrating Restaurant Experience

Aman Narang recounts how his personal frustration with waiting for the check and the inefficiencies in restaurant POS systems led him to envision a better solution. Early in their journey, they built a mobile payments app, but it was buggy and failed to gain traction. This initial failure revealed a broader opportunity — the outdated and complex infrastructure supporting restaurant operations, which ripe for innovation.

Building a Purpose-Built Restaurant Platform and Initial Challenges

Narang and his team aspired to replace the entire restaurant operating system with a cloud-based, integrated platform tailored to restaurant needs. Their first attempt with a simple payment app at a single restaurant resulted in a crash, highlighting the mission-critical importance of reliable systems in hospitality. They learned that most restaurants disliked their existing systems, and the team focused on creating purpose-built hardware and software that better supported restaurant workflows, but faced major hurdles including integration issues with numerous POS providers and convincing skeptical restaurant owners.

Early Market Entry, Customer Engagement, and Scaling Difficulties

Initially, Toast targeted the Boston restaurant scene, working closely with local restaurateurs to iterate and improve their product. The team worked from a basement to save costs, and initial sales were slow, with many customers hesitant to replace their existing systems. Despite early interest and some successful partnerships, scaling proved difficult due to infrastructure limitations, resource constraints, and the challenge of convincing busy restaurant operators to switch to a new, unproven system.

Financial Challenges, Leadership Changes, and Pandemic Impact

By 2015, Toast had grown but faced operational challenges, including outages and support issues. The introduction of a new CEO, Chris Comparato, helped refocus the company on scalable processes and customer experience. The COVID-19 pandemic in 2020 was a severe setback, with revenue plummeting over 90% as restaurants shut down. The crisis prompted the team to innovate rapidly, shifting focus to new solutions for off-premise sales and contactless dining, which contributed to recovery and growth.

Growth, Going Public, and the Future of Toast

The company went public in 2021, reaching a valuation around $15 billion, and continued expanding into new markets and product lines, including retail sectors. Aman Narang reflects on the importance of their scrappy, customer-centric culture, and the role of luck and timing in their success. He emphasizes their ongoing efforts to extend offerings with AI and deepen customer relationships, aiming to capture more of the restaurant market and beyond.

Show notes

After waiting too long to pay his restaurant bill, Aman Narang thought there had to be a better way. His first idea—a mobile payment app—flopped.
But that failure revealed a much bigger opportunity.
Restaurants were struggling with outdated software that many owners hated. Payment systems were expensive, unreliable, and trapped on servers hidden in back offices. Replacing them cost time and money.
But that’s exactly what Aman and his co-founders set out to do: create an entirely new POS system for restaurants—from scratch.
They worked from an unfinished basement, answered customer calls on their own phones, crashed their first restaurant on day one, survived years of rejection from investors—and eventually grew Toast into a business that generates more than $2 billion in annual revenue.
In this episode, Aman shares how a failed product became a billion-dollar company.

What you'll learn:

How to know when it's time to pivot

Why investors rejected Toast again and again

How to convince customers to replace mission-critical software

Why Toast intentionally stayed small before scaling

The leadership lesson Aman learned after almost breaking the company

How Toast survived COVID after restaurants shut down

What founders should look for when choosing a co-founder

Timestamps:

9:00 — The frustrating restaurant experience that inspires Toast

13:16 — The first product fails—and reveals a bigger opportunity

14:18 — Building Toast: “We grossly underappreciated what it would take.”

23:40 — Why nearly every investor said “No.”

27:51 — Toast’s disastrous first launch: writing credit card numbers by hand

29:38 — Pitching hundreds of restaurant owners before finding believers

33:28 — Why customer obsession beats competitor obsession

38:07 — Bringing in a new CEO: “We need to rethink how we do things here.”

46:21 — The biggest lessons from building a $2 billion company

This episode was produced by Sam Paulson with music by Ramtin Arablouei. It was edited by Neva Grant with research help from Casey Herman. Our engineer was Kwesi Lee.

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