Durham County

How Amazon HQ2 could transform cities, win or lose – Gergen & Martin

Can Amazon make the intense competition for its second headquarters (HQ2) be a win for all participants?

In September 2017, Amazon announced that it was soliciting bids from cities across North America to locate a second headquarters that would complement its Seattle base. Once the site is selected, Amazon has pledged to invest $5 billion in the construction of a facility that would ultimately house 50,000 employees.

The economic benefits of landing what has been called the “Olympics of bids” are profound. From 2010-2016, Amazon estimates its investments in Seattle resulted in an additional $38 billion to the city’s economy – including $43 million paid in public transportation by Amazon employees and 233,000 hotel nights by Amazon employees and guests in 2016 alone. With this kind of projected economic impact, it’s no wonder that 238 cities threw their hat in the ring for consideration – including Hickory, Charlotte, the Triad, and the Triangle here in North Carolina.

As has been widely reported, the list has now been narrowed down to final 20 contenders including the Triangle. But the bidding process has not been without its critics.

After Amazon announced its bidding process, 73 community organizations from 21 states including the NC Justice League and the NC Leagues of Conservation Voters wrote an open letter asking Amazing to turn down the tax breaks, support infrastructure that benefits the whole community, and support the “development and preservation of affordable housing.”

Whether Amazon makes good on these proposals remains to be seen; however, there will be undeniable benefit for the winning city. But what about to the 19 cities that fall short (or the original 237)?

To prepare a compelling bid, each city had to come together to create a persuasive and shared vision appealing to Amazon’s interest in finding a new home that “thinks big and creatively” and puts a premium on sustainability, diversity, and a high quality of life. Like any good catalytic project, the Amazon bid created community cohesion around a common commitment to a bold, imaginative future.

Is there a way that Amazon could now harness this energy for good, even for the losing cities?

One idea: as soon as Amazon announces the winning city, it also announces an Amazon Community Catalyst Fund for cities not selected. This Fund could provide a $5 million grant for each of the final 19 cities (or the best ideas from the 237) to be invested in projects that would uplift its community – particularly within under-resourced neighborhoods.

The commitment of $95 million would barely register for Amazon – a company that earned over $493 million in revenue a day in 2017. But a $5 million grant would be meaningful for the recipient cities, especially if it was invested in transformative initiatives.

Given Amazon’s reputation for innovation and its commitment to doing good (including building a shelter for 200 homeless families at their Seattle HQ) the Catalyst Fund could require that cities spend the $5 million on increasing opportunities for under-connected communities to participate in the innovation economy.

For example, a city could use the Catalyst Funds to: strengthen technical and financial support for emerging entrepreneurs and small business owners (particularly for under-connected communities of color, women, and military veterans); support development in under-developed commercial corridors; and create dynamic education and workforce development experiences to help more of its citizens compete in the global economy.

Amazon could also use its global platform to help amplify this work – promoting emerging entrepreneurs through its distribution networks, telling stories of impact, helping cities learn from one another through the process, and cultivating a spirit of collaborative innovation and shared prosperity – as opposed to a winner taking all.

Christopher Gergen is CEO of Forward Cities, a Founding Partner of HQ Community, and author of Life Entrepreneurs: Ordinary People Creating Extraordinary Lives. Stephen Martin is chief of staff at the nonprofit Center for Creative Leadership in Greensboro. They can be reached at authors@forwardimpact.info and followed on Twitter through @cgergen.