Pizza Start-up Creates Crypto To Pay Workers
Who would have thought that pizza and cryptos are perfect together?
Have you heard about Pythagoras pizza? Pythagoras is not your typical pizza joint. If you are living in San Francisco, then you are lucky because they deliver door to door, with a twist. They combine pizza and art. That’s not the only thing that sets Pythagoras pizza different from other pizza restaurants. Why? it is because this pizza joint is joining the cryptocurrency bandwagon. Why and how? Read more about it below.
Since the dawn of burger-flipping, the same riddle has plagued restaurateurs — why should the company’s long-term prospects matter to workers who are paid hourly? Even the best answers have big detractors; just this week, Mario Batali said it’s “odd” to think raising wages is a solution. But a San Francisco start-up that does on-demand pizza is trying a novel (and very Silicon Valley circa 2017) approach: To build morale and help turnover, Pythagoras Pizza wants to give workers something akin to equity in the company. Naturally, this must involve creating a brand-new cryptocurrency that CEO Evan Kuo calls “fragments.” The aim is to pioneer a model “in which all contributors can share in the success of the companies they help build,” he writes in a post on Pythagoras’s website.
These pieces would be distributed alongside regular wages, but they wouldn’t be true equity — they’re not actual ownership, but rather a “new currency” that’s “sort of like Bitcoin, except that it would be linked to the valuation of Pythagoras Pizza itself,” Business Insider explains in an interview with Kuo. Drivers would earn fragments every time they deliver a pie, and cooks would get some for every pie they bake. Customers can even accumulate fragments by referring friends. It should ultimately incentivize everybody to buy, make, and deliver more pizza, and the more pizza there is, the more fragments will be worth. Kuo calls it a “tokenization” model, and writes that this “near-term liquidity” lets the start-up compensate workers immediately, rather than way down the line, like is usually the case with stock options (those work best if you hang tight for an IPO or acquisition).
Kuo says fragments’ initial value would be determined by a set number that they’d presell to investors. The value would then fluctuate depending on Pythagoras’s monthly revenue. The major downside is, fragments aren’tstocks, so their holders would get no say in the company’s business decisions. Other big huhs and whats will probably materialize as Kuo’s plan gets more real, but his perk would function similar to stock options at companies like Facebook or Google, and in theory, give his pizza employees a reason to stick around.