Fast-casual pioneer James Markham blazes a bold new trail into pizza's future.
From MOD Pizza to Project Pie, the outspoken entrepreneur aims to reinvent the way pizzerias serve their guests.
As an ex-boxer and straight-talking man’s-man sort of guy, James Markham doesn’t fear too much. The outspoken entrepreneur, a pioneer in the fast-casual pizza movement, has walked away from not one but two successful pizza chains on the West Coast, simply because he didn’t like the way his partners were running things. He has gambled on high-risk pizza ventures in China when he could have been coasting on his portfolio and sipping gin by the pool back home. In his spare time, he even goes looking for brawls in the mixed martial arts arena, braving choke holds and spinning elbows to the head just for the fun of it.
All in all, Markham has led a bold life of corporate derring-do, but one thing scares the heck out of him: being like everyone else. “One of my favorite quotes is, ‘Only dead fish swim with the current,’” says Markham, the brains behind the new “anti-chain chain” called Project Pie (projectpie.com), with stores in Las Vegas, San Diego and Manila, Philippines. “I’m a really passionate dude. Either you dig me or you don’t. And listen, I’m perfectly OK with that. I think people want something that’s real. That’s what I am, and people seem to dig it.”
People also seem to dig his pizza, not to mention the service model that Markham brings to every concept he launches. His philosophy: Keep it simple, make it fast and make it to the customer’s specifications, all for one low price. He unveiled the system when he co-founded the Seattle-based MOD Pizza (modpizza.com) in 2008 and later Pieology (pieology.com) in Southern California. It has spawned imitators everywhere since then, and the fast-casual segment is booming. Market research firm Technomic even declared the made-to-order niche “the next hot concept” in its recent “Concepts 2020” report.
Nobody agrees with that more than Markham. “Fast-casual is where the restaurant industry is going, period,” he says. “It has grown by leaps and bounds because it gives you all you want—quality, speed, value and, if you have the right concept, a great vibe and atmosphere.”
Reinventing Pizza Service
A native of Washington, D.C., Markham, 43, owned several Cold Stone Creamery stores before launching Carlsbad, California-based Knockout Pizza, specializing in New York-style slices, in 1999. By 2006, he’d sold Knockout and, looking for a new challenge, founded the New York Style Pizza chain in Shanghai. “But I was already thinking I wanted to do something totally different in the pizza industry,” he recalls.
What he wanted to do was reinvent the way pizzerias served their customers. “When you offer New York-style pizza, you make a lot of very specific pizzas—cheese, pepperoni, etc.,” he says. “Then you blow through all of these pizzas during a busy lunch, and people come in and say, ‘Aw, you’re out of pesto?’ So how could I make sure someone comes in and gets exactly what they want every single time?”
A visit to Chipotle Mexican Grill, one of the first fast-casual chains, gave him his answer. “I looked around and thought, this is a great way to do it. You get your burrito or taco exactly how you want it—a little more of this, a little more of that—with great speed and at a pretty reasonable price.”
Upon returning to the United States, Markham partnered with Ally and Scott Svenson, founders of the Seattle Coffee Company, in 2008 to create MOD Pizza. MOD (an acronym for Made On Demand) now has nine locations in Washington. In typical fast-casual style, it offers a build-your-own assembly line as well as a selection of specialty pies. Markham takes credit for the concept and the house recipes, but he says the partners had conflicting goals for the company’s growth. “They were making changes I didn’t agree with,” he says. “I thought it needed to go in a different direction, so we separated, and I started Pieology.”
Pieology, launched in 2011 in Fullerton, California, duplicated MOD’s build-your-own system and hipster vibe, eventually expanding to eight stores. But something still nagged at the ever-restless Markham, and, before long, he’d sold his share in Pieology to a partner and moved on to Project Pie. This time, he planned to do it his way.
—James Markham, Project Pie
The Fast-Casual Movement
It’s hard to say when and where the first fast-casual pizzeria opened in the United States. Solos Pizza Café (solospizza.com), which opened in February 2007 in Maple Grove, Minnesota, may have kicked off the trend, followed by Athens, Georgia-based Your Pie (yourpie.com) in April 2008. Markham and his partners opened the first MOD Pizza in November 2008. “I’ve been credited as the guy (who invented the concept), but I don’t know,” he says. “Who knows? The one thing I know is I have done it in multiple geographic areas, starting with MOD and then Pieology.”
The definition of “fast-casual pizza” has evolved, but it generally refers to a quick-service build-your-own model: The customer goes through the line, chooses a crust and toppings, then waits as a super-hot oven bakes it in just a few minutes. Most pizzas sell for a single price ($7.50 at Project Pie), regardless of the number of toppings, and specialty pies are also available.
Several fast-casual pizza chains have created buzz in recent years, from Top That! Pizza (topthatpizza.com) in Tulsa, Oklahoma, to Pie Five Pizza (piefivepizza.com), a subsidiary of Pizza Inn Holdings. But as far as Markham is concerned, they’re just rushing to catch up to him. “Project Pie is the culmination of everything I’ve learned and done in various geographic areas,” he says. “This is by far the best one from a food quality standpoint, design, the overall vibe. It’s the first time I’ve had complete control of the concept—I can literally do it any way I want.”
And that means throwing the standard corporate rulebook out the window. Project Pie’s slogan is simple: “Don’t Be Fake.” Markham expects every member of his team to take that motto to heart. “We want to do this thing a little differently,” he says. “We call ourselves the anti-chain chain. We want to create something great, to be the pinnacle, and that means being genuine in everything we do.”
Changing the Chain
So what makes Project Pie the “anti-chain chain”? For starters, as the company expands, no two Project Pies will look alike. “A lot of communities don’t like chain restaurants, and the vibe is a big reason—same design, same colors, same everything,” Markham says. “It’s sort of a blight on the community. If you go in and do something that looks and feels more like an independent restaurant, people are more receptive. That’s why we have four different designs, four tile packages, four lighting packages, four flooring packages. This is not a cookie-cutter look—when you walk into our place, it feels like a independent.”
In all cases, Markham went for a female-friendly design with rich hardwood floors and warm lighting. “Women are the ones who decide where the family and kids will eat. And once they find something they like, they become very loyal and share it with their friends.”
Guests who opt to build their own pies choose from nearly 30 toppings, and piling on the pepperoni won’t cost a penny extra. “We don’t limit you on anything,” Markham says. “It’s the customer’s creation—they can do it however they want. But if you come through the line and ask for pepperoni, pesto, artichokes, candied walnuts and cranberries on one pizza, we’ll tell you that your pizza is going to be nasty. But if you try it and don’t like it, just come on back, and we’ll give you one of our own pies. We won’t charge you for that.”
Employees are hired for their personalities as well as their skills, and they’re paid better than most, Markham notes. “We start everybody at 10 bucks an hour. This industry has a high turnover rate. We ran the numbers—it costs us $16 or $17 an hour when you have to constantly retrain people. Why not hire better people and pay them more? They’ll be more dedicated to their jobs. It’s these people that make your brand. It’s not me—our guests don’t see me in the store every day. It’s my team—they’re the ones who make this thing rock.”
Markham looks down his nose at corporate types who dream up chain themes based on focus groups. “They hire somebody else to create a concept that isn’t really them—they just do what they think is going to appear cool to other people,” he says. “It’s almost like living a lie. How can you keep doing something that’s so disingenuous? If you didn’t create that brand and that vibe yourself, how are you going to instill it into your team? With a mission statement? Who wrote that mission statement for you? Me, I want to be creative. I want to do my own thing and show some ingenuity.”
—James Markham, Project Pie
Money Isn’t Enough
But the biggest point of distinction between Project Pie and most chains may be its founder’s lack of obsession with EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization). “People have always known my way works, but they’re so driven by the bottom line,” he observes. “They look at the EBITDA and say, ‘Well, 21% is great, but if we pay everybody less, it can be 22.5%.’ But that isn’t actually true. It’s not going to be another point and a half to you because your employees will suck, your productivity will go down and you won’t create the buzz you want. You’ve got to look past how much money you stick in your pocket. That’s important, but it’s not the most important thing. If you want to be successful, do the right thing, work your butt off, treat your employees well, and good things will happen. If you’re just out to make money, chances are, you won’t—chances are, you’ll have something that isn’t very good, something you won’t be proud of.”
So how will Markham keep Project Pie from devolving into a soulless, bottom line-obsessed company as it expands? “Most people would tell me not to say this in an interview, but the minute this thing starts going down that route, when we’re not thinking about our guests first and sticking with our core philosophy, I’m out,” Markham says. “I’m not gonna do it. If I’ve got to battle with someone saying, ‘We could save another half a point by doing this,’ I’ll be like, ‘Dude, you don’t get it. We got this far because of what we’ve been doing all along. Stay the course, man!’”
And Markham has little doubt he’s on the right course—the fast-casual model is the wave of the future, he insists. “You’ve always had the higher-end pizza restaurants, delivery and pizza by the slice—and there will always be a demand for them—but you’ve never had this middle-of-the-road thing before. You saw how fine dining took a monstrous hit when the economy tanked. Fast-casual and QSR didn’t take that kind of hit. An investor looks at that, and it makes sense.
“What it will come down to is, who’ll be left standing?” he continues. “It’s going to be the ones who can execute, create the right product and the right vibe. And I can tell you for a fact that nobody does that better than my team and I, because we’ve been doing it longer and we’ve done it in multiple geographic areas with different concepts. We’ve been through all the trial and error already.”
But as Project Pie expands—plans called for a new store to open in Boulder, Colorado, around press time, and leases have been signed in New York and Southern California cities—Markham will work only with partners and franchisees that subscribe to his own singular vision. “It’s important to me that people understand what we’re doing and recognize that this is part of something special,” he says. “We’ve turned down a lot of people who come in and go, ‘Here’s my balance sheet!’ I’m like, OK, but do you get what we’re trying to do? Money alone can’t create something great. The hard part is getting the right people to do it with you.”