By Nathan Lam
Over the past two years, the on-demand economy has become one of the most popular business models. And being able to fulfill consumer demand with the push of a button has inspired entrepreneurs around the world. However, as the popularity of these businesses has grown — the challenges have also become increasingly apparent.
Pythagoras, a hyperfast artisanal pizza delivery service in San Francisco, understands the challenges of building an on-demand business better than anyone. Whether creating a three-tiered baking process to minimize cooking time or designing a pizza crust optimized for delivery, the team has found logistics to be one of the hardest problems to tackle and a continual concern.
“Building a vertically integrated brand is exciting but also very difficult for a small team. Between engineering, marketing, food production, and logistics, it feels like you’re operating three businesses all at once.” — Evan Kuo, Founder and CEO of Pythagoras
The difficulties of building your own logistics platform
Availability: A limited supply of couriers meant that customers could only place orders when couriers were readily available.
Expansion: With a limited courier supply, expansion was difficult. The more the team tried to expand their delivery zone, the longer it took for their couriers to return. In order to maintain their speed and quality, they had to reduce their delivery radius.
Staffing: “Forecasting demand became very difficult. You find yourself trying to staff people according to what you expect, but the orders will come in spikes — so you never really get it right.” — Evan Kuo
Overcoming obstacles with the UberRUSH API
“Elasticity is always better than prediction. Even if your model is 80% right, you’re either overstaffing by 20% or underserving by 20%. That’s a huge swing, and the numbers get way worse when you’re trying to grow rapidly. The previous generation of on-demand businesses has required immense capital to scale. UberRUSH has transformed that completely. I think of it as AWS for logistics.” — Evan Kuo
In late May, Pythagoras completed their integration, tapping into Uber’s delivery network to overcome most, if not all, of their challenges. The integration itself only took a few days, and once operations were steady in July, the team turned on the platform to handle the new volume.
What’s next for the team?
In the next few months, Pythagoras will focus on growth and increasing efficiencies. Although their current setup is rock solid, the team believes there is always room for improvement and more they can do to optimize operations. After all, if you want to share your passion for pizza with the world, you can never slow down. So for those who haven’t yet tried out their pizza, download their app now and receive a $20 credit!