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How I Built This with Guy Raz

Advice Line with Tony Xu of Doordash

with Tony Hsu

Published October 2, 2025
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About This Episode

This Advice Line episode of How I Built This features DoorDash co-founder and CEO Tony Hsu joining Guy Raz to coach three early-stage founders through strategic decisions. They discuss when to expand a product line beyond the core offering, how to think about raising capital versus using debt while maintaining control of a growing CPG brand, and how a small, mission-driven meat company can differentiate and educate consumers in a crowded "grass-fed" market. Tony also reflects on DoorDash's evolution, his approach to managing stress, and what he wishes he'd known as a first-time founder.

Topics Covered

Entrepreneurship Business growth and scaling Small business financing Marketing and customer education Scrappiness in business Retail distribution Stress management Problem-first invention Integrity in business Personal Development

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Quick Takeaways

  • Focusing on what you can control and seeking high-agency activities is Tony Hsu's primary strategy for managing stress amidst competition, regulation, and rapid growth.
  • When considering a new product line, start by ensuring you have a strong single leader and enough runway, then treat the expansion as a contained experiment rather than an all-or-nothing bet.
  • For rapidly growing CPG brands, define a clear next milestone, work backward to calculate the capital required, and raise just enough to maintain momentum without sacrificing control.
  • Founders should diligence investors as rigorously as investors diligence them, especially by talking to portfolio founders whose companies did not succeed.
  • Mission-driven food brands can stand out against larger competitors by delivering a genuinely superior product, defining clear standards with their most passionate customers, and leaning on storytelling and word-of-mouth instead of pure ad spend.

Podcast Notes

Show introduction and Advice Line format

Explanation of Advice Line concept

Guy Raz describes the purpose of the Advice Line segment[3:10]
• The Advice Line is a place where the show helps listeners solve their business challenges
• Each week, Guy is joined by a legendary founder and former guest to help advise callers
How listeners can get on the show[3:22]
• Listeners building something and needing advice can call 1-800-433-1298 and leave a one-minute message describing their business and key questions
• Alternatively, they can send a voice memo to the show's email address and should include contact information
Newsletter mention[3:52]
• Guy mentions a free newsletter with insights and ideas from top entrepreneurs, available via his website or Substack

Conversation with Tony Hsu: DoorDash evolution and founder mindset

Reintroducing Tony Hsu and DoorDash background

Tony returns to the show[4:09]
• Guy welcomes Tony Hsu, co-founder and CEO of DoorDash, back to the show
• Tony notes that it's good to be back
Recap of Tony's original episode and DoorDash origin story[4:13]
• Tony was first on the show in 2018, where he told the origin story of DoorDash
• Guy briefly recalls that Tony worked at the same restaurant as his mom after immigrating to the U.S. at age four
• Tony changed his name to Tony because he loved the TV show "Who's the Boss?" and its star Tony Danza
• He came up with the idea for a food delivery business while at Stanford Business School, an idea initially met with skepticism

DoorDash scale and current vision

Growth in orders over time[5:09]
• In 2018, DoorDash had completed around 100 million deliveries
• As of the prior year to this recording, Tony says DoorDash processed over two and a half billion orders
• Tony describes that magnitude of change as hard to comprehend and notes how much has changed in a short period
DoorDash's position and expansion areas[6:12]
• Guy states that DoorDash is now the largest food delivery service in the world
• Tony confirms the company is expanding beyond restaurant delivery into logistics and local commerce, including grocery and retail and international markets
• Guy notes DoorDash has acquired brands like Wolt and Deliveroo, with Deliveroo still in process at the time of recording
Tony outlines DoorDash's five big areas[6:12]
• When they last spoke seven years earlier, DoorDash was essentially a single-product, single-geography company: U.S. restaurant delivery
• Today, DoorDash still brings lunch and dinner in the U.S. but has expanded to delivering groceries, convenience items, and retail items
• DoorDash now operates in over 35 countries, aided by acquisitions
• They also run a B2B business, helping merchants offer delivery and online ordering from their own channels (websites or apps) even if they are not listed on the DoorDash app

Early days: How DoorDash measured success

Initial setup as Palo Alto Delivery Service[6:55]
• Guy recalls the original name "Palo Alto Delivery Service," which had eight PDF menus and a Google Voice number that rang to a founder
Tony's three key validation questions in 2013[7:20]
• Question 1: Would consumers care if DoorDash made all restaurants available for delivery?
• At the time, only about 10-15% of restaurants offered their own delivery
• They watched how often consumers ordered and came back without discounts or marketing incentives to gauge true demand
• Question 2: Would restaurants want to partner to add incremental sales to their kitchens?
• Question 3: Would drivers (dashers) want to partner and deliver on the platform?

Managing stress and competition

External pressures DoorDash faced[7:25]
• Guy notes DoorDash has faced intense stress: competition from giants like Uber launching Uber Eats, changing laws in different states, and rapid scaling
Tony's principle for handling stress[8:39]
• Tony focuses on what he can control and explicitly writes down what not to worry about
• He cannot control competitors' actions or resources but can control which products they deliver and how they serve audiences and customers
• He believes stress often comes with feeling overwhelmed and losing a sense of agency
• To counter this, he seeks high-agency activities-both professionally and personally-where he feels in control and satisfied with how he spends most of his hours

Caller 1: Steelport Knife Co. - When to expand product line

Introduction to Steelport Knife Co.

Ron describes his business[10:19]
• Caller is Ron Kormaie, CEO and founder of Steelport Knife Co. in Portland, Oregon
• Steelport is a small team crafting heirloom-quality carbon steel kitchen knives in Portland
• Every product must meet three requirements: iconic design, functional details, and everything sourced and made locally
Market gap and origin of Steelport[10:49]
• Ron saw a big gap: most premium kitchen knives in U.S. stores were made abroad, primarily in Japan, Germany, or lower-end China
• His background is in technology; he has been involved with 11 startups
• Previously co-founded Finex Cast Iron, which became the only premium American-made cast iron brand when founded; by 2019, eight other companies had entered that category
• A major personal driver for him is bringing manufacturing jobs back to the U.S.
• In 2019 he visited kitchen retail stores and found every premium knife was imported, which he saw as a call to action
• He partnered with knife expert Eitan Zayas, who has 25 years of experience making and sharpening knives, to start Steelport
• Portland is already known as "Knifetown USA" for its many outdoor knife makers; Steelport is building on that heritage for kitchen knives

Ron's strategic question: expand product line or go deeper on knives?

Framing of the dilemma[13:11]
• Steelport currently sells only knives but has developed an innovative, patent-pending cutting board concept
• Ron asks when is the right time for a small consumer goods startup to expand its product line versus going deeper into the core offering

Tony's criteria for launching a new product line

Management bandwidth and leadership[13:58]
• Tony's first question is whether he has the management bandwidth and talent to take on a new initiative
• He looks for a single strong leader who can own the project end-to-end, not necessarily a co-founder, but someone capable of being responsible for the entire new product
Financial runway and synergies[14:42]
• Second, he checks if the company has enough financial runway to support upfront investments in materials, team, and distribution for the new product
• He notes a positive factor here: cutting boards could help sell more knives, creating reinforcing product synergies
Risk tolerance and not waiting until everything feels "ready"[15:13]
• Tony believes that if you feel fully ready, you're probably too late; there should be some element of risk in the decision
• He advises managing risk by disentangling the problem and not treating it as an all-or-nothing company bet

Balancing gut instinct and resource trade-offs

Ron's concern about scarce resources[15:37]
• Ron notes that answers to Tony's questions about resources are virtually never a clear "yes" for small companies; it's always about trade-offs
• He says that in his faculty role he can analyze trade-offs in abstract, but in his own business, projecting outcomes of where to put resources feels uncertain (about 50/50 confidence)
Tony on using experiments instead of all-or-nothing bets[16:46]
• Tony agrees that strategic decisions often lack sufficient data and must lean on gut, but emphasizes they need not be binary, bet-the-company decisions
• He shares DoorDash's 2016 example of launching DoorDash Drive, a service to enable delivery from merchants' own channels
• Even while scaling DoorDash's core app in new cities, they assembled a small group led by one of their best people to explore DoorDash Drive as a contained project
• The initial objective was to figure out whether there was something there, not to commit the entire company

Guy's advice: treat the new product as a managed experiment

Designing a limited test[18:16]
• Guy suggests treating cutting boards as an experiment Ron is willing to lose money on initially
• He recommends making a limited run and offering it to Steelport's most loyal customers as a small drop
• If a limited quantity, say 100 boards, sells out quickly and generates buzz, that would validate demand; if not, the core knife business remains protected
Brand flexibility and cross-selling potential[18:41]
• Guy points out that the Steelport brand name is broad and could support a wider line of U.S.-made kitchen tools, not just knives
• He references other cookware brands that started with one product line and later successfully expanded into adjacent categories
• Ron likes the suggestion of leveraging cutting boards to reach customers not yet ready to buy a top-of-the-line knife and vice versa

Steelport cutting board innovation details

Brand name origin[20:10]
• Ron explains that "Steelport" comes from combining "steel" and "Port" from Portland
Construction of the new cutting board[20:50]
• The new board embeds steel inside two different layers: end-grain wood and a composite recycled paper material
• This allows a two-sided cutting board with a steel reinforcement that permits a much thinner profile, about half an inch versus typical 1.5 inches
• Guy notes that thinner boards help with storage, especially in narrow kitchen slots, and mentions having gotten rid of thick plastic boards for health reasons

Caller 2: Spring & Mulberry - Financing growth vs profitability

Introduction to Spring & Mulberry

Catherine presents her business[25:35]
• Caller is Catherine Shaw from Raleigh, North Carolina, co-founder of Spring & Mulberry
• Spring & Mulberry is a line of date-sweetened dark chocolate
• The company started with the question: can sweets be indulgent without refined sugar?
Product and health positioning[25:53]
• They sweeten chocolate with dates instead of cane sugar or corn syrup
• Catherine notes dates are a whole food high in sugar but also high in antioxidants (more than blueberries) and magnesium (more than bananas)
• Dates are rich in fiber, which slows sugar absorption and lowers glycemic index and load
• Bars are visually artistic, with toppings like dried strawberries, whole pecans, and mango pieces pressed into the chocolate
• Some bars are topped with fruits, florals, nuts, and spices with flavors such as mulberry fennel, mixed berry, and pecan date
• Other bars infuse chocolate with essential oils to create nostalgic flavors like mint leaf, coffee, and blood orange

Origin story and founders' backgrounds

Inspiration from travel and health crisis[27:26]
• The idea began on a trip to Dubai en route to visit her husband's family in India, where Catherine encountered dates in elevated, beautiful gift boxes
• Later, a breast cancer diagnosis in her mid-30s led her to quit refined sugar and explore healing power of whole foods
• She wanted to showcase a wider world of flavor through chocolate without refined sugar
Professional experience of the founders[28:06]
• Both founders have worked in consumer products and luxury goods
• Her co-founder Sarah was an early employee at Harry's Grooming and Siggi's Yogurt, working in product development, operations, and finance
• Catherine worked in marketing and sales at Unilever and then at LVMH (Moët Hennessy Louis Vuitton)

Business performance and distribution

Launch timeline and growth[28:42]
• Spring & Mulberry launched in beta in spring 2022 and fully launched for the holiday season that year
• The company has grown 2-3x year-over-year consistently
• They are now doing mid-seven figures in revenue and expect to double that in 2026
Omnichannel strategy[29:49]
• They pursue an omnichannel strategy: aiming for natural channel grocery (Whole Foods, Sprouts) and specialty retailers (airports, Total Wine, Nordstrom, Bloomingdale's)
• They launched this year in several specialty retailers mentioned
• Direct-to-consumer still accounts for about 50% of the business and has the best margins

Catherine's question: types of capital, partners, and risk balance

Funding inflection point[30:53]
• To date, the business has been profitable but is feeling cash flow strain from rapid scaling
• She wants frameworks for which types of capital to raise, how to choose partners, and how much risk to take on growth versus profitability

Tony's framework: define milestones and protect control

Clarifying the company goal and near-term milestone[31:41]
• Tony asks about their long-term goals; Catherine says they want to transform America's relationship with sugar by offering a wholly better product
• Near term, to hit eight figures in revenue, they must launch nationally at major chains like Whole Foods and Sprouts, which requires significant cash
• He notes they don't need to solve financing for the entire future vision in one round; they should instead define the next concrete milestone
Costs and constraints fueling the cash crunch[32:22]
• Catherine lists two main drivers of the cash crunch: chocolate seasonality and upfront costs of grocery distribution
• They must buy holiday inventory during summer, the slowest chocolate months when consumers switch to ice cream
• Grocery chains require slotting fees, free fills (free product), and marketing support to sustain strong velocities on shelf
Two guiding principles for financing[32:11]
• Tony articulates two principles: keep up business momentum and avoid losing control of how the business is run
• He argues the best way to prevent loss of control is to keep delivering on promises and maintain growth momentum
• He recommends calculating the capital needed to reach the next milestone (including buffer) and then framing for investors what those dollars will achieve
• Given her 2-3x growth, Tony believes she will find many willing investors if she continues to hit milestones

Equity vs debt options and investor diligence

Current capitalization and options[34:06]
• Catherine explains they raised a pre-seed round when the brand was doing low six figures and have grown to mid-seven figures without VC or debt
• They used strategic angels with industry experience and have not taken any loans
• Guy notes she now needs cash and outlines options like lines of credit, revenue-based financing, and purchase order financing, which can involve high interest but preserve equity
How Catherine is thinking about debt vs equity[34:48]
• She sees debt as appropriate for smoothing seasonal cash flow around inventory purchases, since that is timing rather than structural burn
• She views equity as more suitable for retail expansion and brand-building investments, which are spend-ahead-of-revenue activities
• She is nervous about taking significant debt while not yet reliably profitable; this is the first year they are trying to hover close to breakeven
Tony's advice on vetting investors[35:33]
• Tony points out that while investors conduct due diligence on founders, founders often neglect to do the same on investors
• He urges her to clarify each investor's time expectations for milestones and returns
• He recommends asking investors for examples of portfolio companies that did not succeed and speaking with 3-4 of those founders
• Talking to founders from less successful outcomes can reveal how the investor behaves under stress and whether they will be a good partner

Additional product strategy suggestion from Guy

Opportunity for smaller format products[37:21]
• Guy notes her bars are expensive premium products and suggests a smaller format like individually wrapped squares, inspired by Ghirardelli
• A bag of small squares could offer 1-2 grams of sugar per piece, making it a lower-cost trial and everyday indulgence option
• He mentions that such a format could open doors to large-scale distribution channels like Costco in the future

Tony's closing encouragement

Trusting one's own instincts[37:36]
• Tony tells Catherine she has a strong point of view about what she wants and does not want and encourages her to stick to it
• He observes that founders often instinctively know the right answer and should not overvalue external "expert" opinions at the expense of their gut

Caller 3: Route 22 Meats - Differentiation and consumer education

Introduction to Route 22 Meats

Yori presents his business[42:05]
• Caller is Yori from Stamford, Connecticut, founder, operator, and investor in Route 22 Meats
• He has spent the past 20 years in early-stage technology companies in various roles
• Route 22 Meats is a mission-driven company aiming to bridge the gap between small family farms and conscious consumers
• They ship grass-fed and grass-finished meats from small family farms with full traceability back to the farm
Product and service details[43:04]
• They ship meat boxes directly to consumers in frozen form

Origin and motivation

Personal need and healthcare exposure[43:21]
• Yori started the business because he personally was looking for true grass-fed product and couldn't find exactly what he wanted
• He spent eight years managing U.S. operations for a medical device company and saw firsthand how broken the healthcare system is
• This motivated him to be part of the solution by connecting clean, quality food with conscious consumers

Differentiation in a crowded "grass-fed" market

Guy's competitive landscape question[43:36]
• Guy observes there are many options for ordering grass-fed meat online and in grocery stores, including big-box retailers
• He asks what makes Route 22 Meats different
Yori's points of differentiation[44:36]
• Each cut they ship is labeled with the specific farm it came from, offering full traceability
• They only work with small family farms, not big industrial operations
• He notes a regulatory gap: in 2016, the USDA dropped its formal definition of "grass-fed," so the term on packaging can be misleading
• This is akin to vague labels like "all natural" that do not guarantee meaningful standards

Yori's question: how to educate and stand out with limited resources

Framing the strategic challenge[46:14]
• He asks how, given their small size and resources, they can effectively educate consumers and differentiate in a market where larger players can outspend them
• He emphasizes that bigger rivals cannot match their authenticity, traceability, regenerative standards, and commitment to true grass-fed and grass-finished meat

Tony's advice: build with passionate early adopters and a shared standard

Two core challenges Tony sees[46:14]
• First, ensure the product truly delivers on its promise: clean sourcing and taste that is as good or better than alternatives
• Second, learn how to market it in a way that is authentic and differentiated from larger spenders
Choosing the right initial customer base[45:59]
• Tony says the initial focus must be on customers who care deeply about the same values, such as fitness enthusiasts or restaurateurs who prize clean supply chains
• He compares building the brand to starting a fire: the key early on is to keep the small fire burning by serving these passionate users
Co-creating a meaningful standard or term[47:03]
• Given the USDA's lack of definition, Tony suggests working with loyal customers to coin or define a term that captures their quality standard
• It is more powerful to tell the story from customers' perspective and language, which fosters organic word-of-mouth growth

Current scale and physical expansion of Route 22 Meats

Revenue and infrastructure[47:44]
• Yori expects to finish their first 12 months of operation with about $100,000 in revenue
• They purchased a building in a farming community that used to be a McDonald's and converted it into a distribution center
• They intend later in the year to turn it into a farm store where multiple farmers can sell products
• He notes farmers excel at farming but typically lack expertise in cold supply chain logistics and e-commerce
• Route 22 aims to build a platform that lets these farms reach consumers across the country

Guy and Tony on health trends and channels for education

Health-oriented search trends[48:54]
• Tony explains that DoorDash observes search behavior and sees widespread interest in healthier diets, though with geographic variation
• He confirms a macro trend: people increasingly want to be healthier through both exercise and nutrition
Guy's suggestion: storytelling over ads[49:27]
• Guy suggests that a well-placed podcast interview or public talk can be more effective than spending thousands on digital ads for a business like Route 22
• He stresses that Yori's business is suited to grow via word-of-mouth, with current customers recommending the meat to friends
• Long-form channels allow explaining why standard grass-fed labels may be misleading and how Route 22 differs, even if the audience is only a few hundred or thousand people
• Yori agrees they should keep reaching out to communities this way

Closing reflections on entrepreneurship and Tony's lessons learned

Tony's perspective on shared founder challenges

Founders' problems are often similar across sectors[53:39]
• Guy remarks that Tony has faced versions of the fundraising, product expansion, and awareness-building dilemmas discussed in the calls, even if in different contexts
• Tony notes that a privilege of being an entrepreneur is belonging to a community of founders who encounter very similar problems across categories like chocolate, knives, and meat
• He emphasizes that while industries differ, the core business-building questions are often the same

What Tony wishes he had known earlier

Trusting one's own knowledge and instincts[53:45]
• Tony says that many founders already know the answers to the questions they seek help on
• He points out that creators of great products in other industries were not fundamentally different from the founders calling into the show
• If he could advise his younger self, he would emphasize trusting his own instincts more
Writing things down and learning from the team[54:59]
• Tony mentions writing things down as a way to avoid self-delusion and to enable more intellectually honest debates with others
• He says many of his ongoing lessons and sources of motivation come from watching his own team's successes and setbacks
• He continues to derive lessons from what his colleagues do day to day, reinforcing continuous learning as a founder

Show wrap-up

Pointer to Tony's original episode and listener participation[55:47]
• Guy encourages listeners who haven't heard Tony's original How I Built This episode to go back and listen; a link will be in the show notes
• He reiterates the invitation for entrepreneurs to send in a one-minute message about their business and questions for future Advice Line episodes

Lessons Learned

Actionable insights and wisdom you can apply to your business, career, and personal life.

1

Focusing on what you can control and seeking high-agency activities is a powerful way to manage stress and maintain momentum when building a company in a volatile environment.

Reflection Questions:

  • • What situations in your work currently trigger the most stress because they feel outside your control, and how could you explicitly list and set those aside?
  • • How might your daily schedule change if you deliberately prioritized high-agency activities where your actions clearly influence outcomes?
  • • What is one specific aspect of your business this week where you can shift attention from worrying about competitors or circumstances to improving your own product or customer experience?
2

When expanding beyond your core offering, treat new initiatives as structured experiments led by a clear owner, with bounded investment and explicit learning goals instead of all-or-nothing bets.

Reflection Questions:

  • • Which potential new product or project in your business could you reframe as a small, time-bound experiment rather than a major commitment?
  • • How could identifying a single accountable leader for a new initiative increase its chances of success and reduce confusion on your team?
  • • What constraints on budget, timeline, and scope can you put around your next experiment so that even a "failure" yields valuable, affordable learning?
3

Define a concrete next milestone for your business, work backward to understand the capital required to reach it, and raise just enough money from aligned partners to hit that milestone without giving up unnecessary control.

Reflection Questions:

  • • What is the single most important measurable milestone you want your business to reach in the next 12-18 months?
  • • How can you break that milestone into the specific costs (inventory, distribution, marketing, hiring) required, rather than thinking about funding needs in vague terms?
  • • When you look at potential capital sources, which ones best support your path to that next milestone while preserving your decision-making authority and ownership?
4

Founders should rigorously diligence investors and partners, especially by learning how they behave when things go poorly, to ensure alignment on time horizons, expectations, and working style.

Reflection Questions:

  • • Which current or potential investors and partners have you not yet vetted by talking to founders who worked with them in difficult situations?
  • • How might your fundraising conversations change if you explicitly asked about time expectations for outcomes and examples of companies that did not succeed?
  • • What questions will you add to your next investor or partner meeting to better understand whether they will support you through setbacks, not just successes?
5

Authentic differentiation in mission-driven consumer brands comes from delivering a genuinely better product to a focused group of passionate customers and letting them help define the language and standards that tell your story.

Reflection Questions:

  • • Who are the small group of customers who care most deeply about the same values that drive your business, and how well are you serving them today?
  • • How could you involve these early adopters in coining or validating a term, standard, or narrative that clearly distinguishes your product from look-alike offerings?
  • • What is one concrete step you can take this month to shift some of your marketing energy from broad paid advertising to deeper storytelling and word-of-mouth channels?

Episode Summary - Notes by Sage

Advice Line with Tony Xu of Doordash
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