Fine Print - May 2008
If you ever had cause to visit the Durham headquarters of Motricity Inc., the software company that found itself with a pile of investor cash last year, you surely marveled at the place. In the renovated American Tobacco complex, within foul-ball distance of Durham Bulls Athletic Park, the headquarters would be the envy of any working stiff who labors in a soulless office building under fluorescent light oozing from an acoustic-tile ceiling. Exposed brick walls? Check. Mammoth wood beams? Check. Stylish furniture? Check. Employee lounge that looks suspiciously like a pub? Check. Nightlife, festivals, restaurants and sporting events fewer than 100 paces away? Check.
Let’s make it official: Motricity’s headquarters is as good as it gets for corporate life. Better yet, North Carolina (and the Triangle specifically) is one of the more nurturing locales for ambitious tech firms, providing an educated work force and political leaders so accommodating that a weekly wash-and-wax of the CEO’s car by the governor isn’t wildly out of reach as an incentive. What company would ever leave such a paradise?
Uh, Motricity. It’ll be gone by the end of the year. Simply put, Motricity — formed in 2004 by the merger of Durham-based Pinpoint Networks and Nashville, Tenn.’s Power by Hand — traded up. When it spent $135 million of that investor money to buy a division of InfoSpace, it decided that Bellevue, Wash. — the Seattle “boomburb” where InfoSpace is — would be an upgrade from Durham. Probably the most significant tech corridor outside Silicon Valley, it’s teeming with software programmers and engineers. But Motricity’s move still has the flavor of a sophomore social climber leaping at the chance to sit at the seniors’ table in the high-school lunchroom. When you realize that analogy makes Durham — and by extension, all of North Carolina — the table where the braces-wearing, acne-plagued doofuses gather … well, it stings.
This is the point at which I could be expected to clamber atop my soapbox and inveigh against the foolishness of passing out incentives willy-nilly to bribe companies either to move to North Carolina or stay here. (After all, Motricity is leaving because it feels Bellevue is a better place to do business, not because it’s being lured away.) Instead, I’ll pose a question: How much loyalty should a company feel to the place of its birth, and how much should we residents feel to that company?
What we owe our companies is an equitable tax structure, a reasonable regulatory climate, an efficient permitting system and a well-maintained infrastructure — in short, the same things we owe ourselves. We also owe them the first chance to claim our patronage. If all things are equal, our reflex should be to buy goods and services from the local fellow. Corporate loyalty to the place that spawned it is more complicated. Companies are like children, in the sense that they start small, grow large and eventually form their own identities and characteristics. Some are surly and grabby and me-me-me right from the beginning, while others grow up gracious and charitable and generous. Some come to feel rooted and comfortable in their homes, while others are always scanning the horizon, wondering if life isn’t better somewhere else.
Let us consider two of our children and examine their relationships with home. Recall first the peripatetic journey of RJR Nabisco. The company, an amalgamation of homegrown R.J. Reynolds Industries and Nabisco Brands, came under the rule of the much-loathed F. Ross Johnson on Jan. 1, 1987. Two weeks later, he announced that RJR Nabisco would move its headquarters from Winston-Salem to Atlanta. And just to pour salt in the wound, Johnson declared that the Twin City simply didn’t have the cultural sophistication to attract young executives. Too “bucolic,” he said.
You can imagine how the good citizens of Winston-Salem felt about that. The new boss had barely been in the job long enough to warm the seat when he announced that the company needed to move out of Hicktown and into a real city. As it turned out, Atlanta wasn’t good enough. After a leveraged buyout by Manhattan big-game hunters in 1989, the headquarters wound up in New York. Eventually — divested of food divisions and some foreign operations — what is now Reynolds America returned to Winston-Salem.
If RJR was the prodigal son, NationsBank was the dutiful one. In 1998, NationsBank — né North Carolina National Bank but grown under gimlet-eyed Hugh McColl into a regional powerhouse — announced that it would merge with San Francisco-based BankAmerica, a deal that would create the largest retail bank in the country. McColl could have been forgiven if he had decided to decamp for Manhattan to join the ranks of the financial world’s Big Swingers. Instead, the newly merged company took the name Bank of America from its new mate, but headquarters stayed in Charlotte, housed in the tallest building between Philadelphia and Atlanta.
A child that considerate is a blessing. Clearly, Motricity isn’t like that. Maybe it’ll wander for a while, then return home, a la RJR. If not, we know what to do: Talk trash about it during family gatherings.