Already serving a limited area surrounding its sole brick and mortar location in densely-packed San Francisco, Pythagoras Pizza is also pioneering into the cryptospace with a plan to implement a plug-and-play model for franchise tokenization, which it announced on September 20, 2017.
Pythagoras is the brainchild of CEO Evan Kuo, who started the gourmet pizza company after he and a friend developed an application to simplify the process of ordering pizza down to a few clicks based on preprogrammed predilections. "We wanted better delivery pizza, and we wanted it to be simple," Kuo told ETHNews in an exclusive interview. From those humble beginnings, the idea snowballed after Kuo networked with a professional chef, developed his own product, and began serving a growing customer base.
Kuo is motivated by a necessity to manage his business in a scalable way as it grows. He also envisions an infinitely divisible resource that could bestow greater value to workers than fiat currency; this prospect materialized in the form of cryptocurrency. Kuo believes his franchise tokenization model will bolster a growing gig economy while delivering career mobility to employees so they can obtain "the same potential upside that privileged startup employees at private companies are able to enjoy."
Pythagoras revealed plans to implement an ERC20 token called Fragments (FRG), which is detailed in the company’s whitepaper. The protocols are still in development and may change before Pythagoras goes live with a blockchain-based service, according to Kuo. For now, in terms of liquidity and pricing, Kuo said he intends to peg the value of the token to the value of a pizza, along the lines of Nobel Laureate Friedrich Hayek's book The Denationalization of Money, wherein the author proposes commodity-backed indexes. "In our case, a single commodity – if you will, pizza – will ultimately be much more stable and attract more usage than a currency run by a monopolistic government who doesn't face the consequences of extreme inflation. For example, we've seen the purchasing power of the dollar decline over time, actually aggressively."
Kuo explained, "What we want to do is connect the demand for the underlying consumptive good with the supply, and ultimately with a token market cap." By this reasoning, volatility can be mitigated. Kuo elaborated, "You want to manage that [liquidity] so that the evolution of your value is commensurate with consumptive demand for underlying good."
Kuo believes other businesses can benefit from Pythagoras' tokenization model and, to that end, the protocol Kuo designs is going to be open sourced so other businesses can enjoy "plug-and-play interoperability."
"I actually think that you want a lot of businesses doing this," said Kuo, "because that is what will ultimately stabilize cryptocurrencies for everyone."