Raleigh firm that enables voice conferencing for Google, Zoom plans to add 1,165 jobs
Raleigh tech firm Bandwidth Inc., which makes communications software that enables the voice conferencing offered by Zoom, Google and others, announced Tuesday that it is expanding its headquarters and creating up to 1,165 new jobs over the next eight years.
In exchange for the expansion, the state’s Commerce Department said it will give the company a Job Development Investment Grant worth up to $32.3 million over the next 12 years, if Bandwidth meets hiring and investment goals.
Bandwidth has been based in the Triangle since it was founded almost 20 years ago, and its current workforce totals more than 750, according to the Commerce Department. As part of its agreement with the state, it plans to invest more than $103 million in Raleigh, which will include the construction of a new office building.
The company’s customers include Google, Microsoft and Zoom, who use its cloud-based voice and messaging technologies in a variety of products. The company posted revenue of $232.6 million in 2019. The voice conferencing business has grown significantly as a result of the coronavirus pandemic and the increase in companies that have ordered or urged employees to work from home.
Bandwidth is playing a key role in that, CEO David Morken said. For example, when you dial into a Zoom conference or if you have a Google Voice number, Bandwidth is providing that phone number and connection that allows you to talk, as well as a variety of other services, he said.
“The work-from-home mandates have driven many of our customers to levels of demands not seen before,” Morken said in a phone interview. “We have had to rally around the clock, sometimes running on fumes through the night to [service] our conferencing customers. It hasn’t been easy but our services our vital.”
Morken said the company never hesitated in pursuing a deal to expand in North Carolina because of the coronvirus downturn. He pointed to the company’s history of successfully navigating through multiple downturns, and noted it is coming from a place of financial strength. The company raised $85 million in its 2017 initial public offering and has around $185 million in cash on hand, according to federal filings.
Morken said the company committed to expanding in Raleigh because of the talent pool here, with its existing workforce pulling from both North Carolina universities and community colleges.
The new positions — which will primarily be in research and development, operations and sales and marketing — will offer average wages of $96,832 per year.
The massive expansion will mean the company will outgrow its current office on N.C. State University’s Centennial Campus. It has been based there since 2012, when it took over the office space Red Hat vacated when Red Hat moved moved to downtown Raleigh.
Also on Tuesday, Bandwidth got approval from the North Carolina Council of State to buy a 40-acre plot of state-owned land to build its new headquarters. The land is at the southwest corner of Reedy Creek Road and Edwards Mill Road and has been mainly used by the the N.C. Department of Agriculture as parking for the state’s annual fair. Bandwidth will pay $30 million for it.
The company plans to add a Montessori school to the new campus, which it expects to open in 2022. Executives from Bandwidth traveled to the clothing brand Patagonia’s offices to see how they operate a school there for children of employees. The company says childcare is the No. 1 topic it hears about from employees.
“When we talked to Patagonia about it, they said they attract talent who come because of the Montessori school,” Morken said. “And their retention rate after maternity leave, they say is 100%, which is amazing, because in the tech world you can have attrition rates of around 50% after maternity leave.”
In addition to the state incentives Bandwidth will receive, Wake County will chip in nearly $3 million in its own incentives and the city of Raleigh will contribute $1.65 million.
According to the state’s Commerce Department, Bandwidth was considering splitting the new jobs between its three existing offices. The company has a presence in Rochester, N.Y., and in Denver, which has become a tech hot bed much like Raleigh in recent years.
The expansion comes as many businesses in North Carolina, especially small ones, are hemorrhaging jobs because of the COVID-19 pandemic. More than 400,000 people in the state have now applied for unemployment benefits in North Carolina because of coronavirus-related shutdowns, said Tony Copeland, the state’s secretary of commerce.
Copeland said Bandwidth’s expansion shows that there is still a tremendous amount of belief in North Carolina’s economy despite the massive disruption of the coronavirus.
“It shows that people still have confidence in North Carolina,” Copeland said in a phone interview. “This is a pause. We are part of a global economy and people will be poised to roar back when this is over with.”
Copeland said the deal with Bandwidth had been in the works since last year. He added that the fact that Bandwidth stayed committed to the expansion despite the pandemic is making him optimistic the state will remain in a good position to restart its economy in the coming weeks and months.
A big reason for that, Copeland said, is the state’s workforce will be as talented after the crisis as it was before.
“We have been working on that for the past 60 years,” Copeland said. “We have talent like nowhere in the world and that hasn’t changed. It will be my mission and the governor’s mission that all companies see us as being stable and confident” throughout this crisis.
“Businesses are going to look at how we dealt with the pandemic and how we come out of this,” he said. They will be looking at “where is a secure place to do business ... our job is to build on that.”
This story was produced with financial support from a coalition of partners led by Innovate Raleigh as part of an independent journalism fellowship program. The N&O maintains full editorial control of the work. Learn more; go to bit.ly/newsinnovate
This story was originally published April 7, 2020 at 12:52 PM with the headline "Raleigh firm that enables voice conferencing for Google, Zoom plans to add 1,165 jobs."
