How to reinvent franchising with tech and transparency

A New Year’s Day is a relative point, but it measures time. It’s good to take stock of what’s done and set new goals for the future. Today I’ve asked myself a simple question—what was the key moment for our company in 2018? Not an easy question. There are many answers, but what was the most important thing in terms of the long-range prospects of our business?

In 2018, our company has become profitable. We’ve been trying to achieve this for seven years. Dodo Pizza is a franchising company, so the parent...

It’s done. We’ve been working towards this for many months. We’ve finally signed an agreement to lease premises in an A-category shopping mall in Hangzhou, China. In the photo, Bauyrzhan Sadykov, the leader of the Dodo Pizza China team, holds a signed lease contract with a shopping mall named “501.”

That wasn’t easy. The first potential place for our Hangzhou “pizzeria of the future” was found in the summer. Our Chinese company was still getting registered at the time, so we signed a letter of intent with a private citizen who owned the premises. We designed...

Meet Mr. Xie. Mr. Xie is a real estate agent. He works with retail property. And he believes in us. We wouldn’t be able to meet the managers of a big shopping mall in Hangzhou and interest them in collaboration with Dodo Pizza if it wasn’t for him. Personal relationships and contacts are very important in China. Why did Mr. Xie help us? He saw the long-term opportunities and felt that he could trust us. He has yet to make money from our collaboration, but he’s already done a lot. A few days ago, he invited managers of shopping malls all over Hangzhou to WeWork so we could do a presentation of our company and the concept of our pizzeria here. As per usual in China, a lot of precise and straightforward questions were asked. And after that, we invited everybody to dinner. In China, a good business meeting always ends with a meal. Business, relationships, and food are inseparable here. I’m certain that everybody who was there will come to our “pizzeria of the future” grand opening, and this will be a new beginning and a new step forward for us. Today we plant the seeds with open hearts, and tomorrow some of them are bound to grow. Thank you, Mr. Xie. We will not let you down. We highly appreciate our partnership and your trust.

It so happens that Dodo Pizza has become one of the first residents of WeWork, an international coworking space in Hangzhou, China. WeWork opened here just recently, so half of it is still empty. I’ve been at WeWork for three days, and now I have first-hand knowledge of what they’re trying to create here. Most importantly, it’s a specific atmosphere that charges you with energy, and even three beer taps with unlimited refills don’t hamper your motivation. And, of course, WeWork creates community. Over the last three days, I’ve met a lot of interesting people here.

The scale and thoroughness of their work are astounding. Everything is made to be durable and American-style; they didn’t save money on anything, and you see it in every square inch of the interior finish. Ten thousand square meters of offices on two floors encircle a huge courtyard under a skylight—that’s where the communal area is located. There are kitchens, conference rooms large and small, and phone booths.

A few days ago, there was a great party at WeWork for the Hangzhou coworking space grand opening. The party budget was staggering. There was professional lighting, live music, various recreational activities, actors, entertainers, a whole team of chefs, and unlimited alcohol—cocktails, wine, and also oysters and hors d’oeuvres. Whatever guests wanted.

Christian Lee, the managing director of WeWork Asia, attended the opening. A Chinese ballet company appeared on stage, as well as an illusionist and a Chinese blues band. The director of the first Hangzhou coworking space said that WeWork never begrudged money on repairs and refurbishment, and one square meter of interior finish cost about $1000. So, WeWork has spent 10 million dollars on the refurbishment of rented premises, save furniture and the opening ceremony costs. I walked around and wondered how and when they were going to cover all these expenses.

The thoroughness and the scope of everything, from the coworking space interior to the party itself, were amazing indeed. And keep in mind that currently, WeWork is not profitable. They invest a lot of money in the future. No, I’m not a conspiracy theorist always looking for a catch. I believe in WeWork, and WeWork believes that offices and the approach to work itself will change dramatically, and then they will become the new Facebook and the investment will pay off, because they’ll be on top. No, they don’t want to make money off rent. It will never cover such investments. They want to create a new global business community.

Sometimes we believe in an idea that needs testing. We try to persuade investors. Sometimes we spend years and millions of dollars to prove that the idea will work.