Go Where the Action Is, but the House?
30th June 2011 · 0 Comments
In several companies I’m involved with now we’re wrestling with the notion of locating the businesses where the action is. Positioning yourself along with a collection of like-minded entrepreneurs, even direct competitors, is a good way to hone your strategy, gain access to talent and capital, and be in the know when new innovations are rolling out. Austin is a great example of that in mobile. Lots of good things can happen by just making yourself part of the scene. I’ve bet my own business on making the household move and trying to be engaged in as much here as possible.
Another project may involve distribution of goods through big-box retailers, and that one probably has to go where we can assemble the best management and marketing talent with relevant experience and relevant address books. (Rolodex now sounds too dated!) The founding entrepreneur is flexible; rather than bring the management team to him, he may be best served by going where they live. That could be Atlanta or probably some other city of size east of the Mississippi.
Yet another one needs to disperse its key executives according to their roles. In that particular case, development is being done here in Austin, but the primary customers will be making decisions in places like NYC and Chicago. These team members already know each other well and don’t have to be in one facility to bond. They can leverage technology to be out in the trenches where the revenue is to be found.
Unfortunately the current housing market imposes an enormous amount of friction in these decisions. If you are looking to bring in a key person who is in family formation stage with a house, kids, school concerns, etc., chances are pretty high that his or her house is either “underwater” or likely to be sold only after many, many months on the market. The drumbeat of bad news in the residential sector just continues to wear on the economy in general and reduces career flexibility. Only the largest companies with very highly paid recruits can absorb the costs of corporate re-lo in this climate.
One idea I have is to create an Airbnb-like service for permanent home swaps. If there were a service to match homes in, say, Dallas and Atlanta according to apparent market value (whatever that is), equivalent schools and amenities, and other factors, there are probably enough families wanting to go in either direction to create some trading opportunities. This would not, however, be a simple Internet transaction. Mortgage holders would have to get involved, and the families would actually have to exchange titles in order to get the mortgage interest tax deduction for an owner-occupied home. If one or both houses are underwater, the lenders would have to agree to some resolution of that. Bottom line, this would be legally complicated, but if it were possible it might create jobs by making people once again portable to where their skills are most valuable.
If you want to work on this idea, it’s yours. The real action on this one is probably near Bank of America in Charlotte, a rather nice city in my opinion.
