Logan Smith

A laid-off marketer in San Diego has thousands of people fighting over his pizza, and the only reason they can't get one is his apartment oven cooks a single pie every 30 minutes. A Nobel-winning economist figured out back in 1991 why guys like him should never raise their price. AJ Miller takes orders on Saturday, preps all week, and bakes on Friday with pickups from 2 to 10pm. Eight hours at one pie every half hour is 16 pizzas. So those 15 slots everybody's losing their minds over are pretty much one Friday of oven time. Home ovens are just bad at this. He bakes on a steel at 550°F and flips on the broiler at the end to crisp the edges. Every pie sucks heat out of that steel, and a regular kitchen oven takes a while to get it back. A real pizzeria oven holds a bunch of pies at once and bounces right back between them. AJ bakes one and then stands there waiting for the steel to heat back up. At $25 to $30 a pie, that's maybe $400 a week. Meanwhile his waitlist went from 75 to 1,500 people in a single week back in September, and it's in the thousands now. Any econ major would tell him to put the 15 pizzas up for auction and let 1,500 people bid. Gary Becker wrote a paper in 1991 about why that backfires. He was looking at two nearly identical seafood places in Palo Alto. One had a line out the door every night, the other had empty tables, and the busy one never raised its prices. By the textbook, it should have. Becker figured out that a big chunk of what people pay for at a hot spot is everybody else wanting in. Raise the price and the line gets shorter, and a shorter line tells the next person maybe this place isn't that special. He also showed a place can go from "in" to "out" way faster than it can climb back. He won the Nobel the next year. Think about what AJ actually has right now. Every pizza he sells comes with at least 100 people who tried to buy it and got told no. Every one of those people goes online and complains about missing out. That's free advertising, and a guy who just lost a marketing job knows what it's worth better than anybody. California even has a legal version of this. The MEHKO law lets you run a tiny restaurant out of your apartment with a county health permit, and San Diego County signed on in 2022. You're capped at 90 meals a week and roughly $100,000 a year in sales. At his prices, 90 pizzas a week would blow past the money limit, so a home pizza business legally tops out somewhere around 70 pies a week. So the apartment maxes out around a hundred grand, and the waitlist is worth way more than the pizza ever will be. Somewhere in San Diego there's a landlord with an empty storefront who's about to get the easiest pitch of his life, and AJ gets to walk in with a list of thousands of people who already tried to give him money.