Santa Cruz Sentinel
SCOTTS VALLEY – Virtual Instruments, a young startup born in Scotts Valley’s old Borland building, has moved its nearly 100 employees to a new headquarters in San Jose, leaving another empty commercial office in Scotts Valley.
New hires were largely coming from Silicon Valley, the lease was up and, while the new lease proposal was good, it was still better in San Jose, said a company executive.
The company’s first day of work in the new building, just a mile from the San Jose airport was Nov. 22.
“We are continuing to grow aggressively,” said Len Rosenthal, vice president of marketing for the 2-1/2 year old company. “Although there was ample room in the SV location, we found that the overwhelming majority of our new hires were coming ‘over the hill.’ It simply is an advantage in recruiting to be closer to the hiring pool.”
Rosenthal described the lease at the Enterprise Technology Centre as “a very financially attractive” one that was largely funded by the startup’s former parent company, Finisar Corp.
Although the intention was to keep the headquarters in Scotts Valley and open up a satellite office somewhere in the South Bay, the terms were “not sufficiently attractive relative to the terms we received in the San Jose office, especially when balanced by the desire by the majority of our employees to move the HQ offices closer to the South Bay.”
John Thompson, the company’s new chief executive officer also lives in Silicon Valley as do a majority of the executives.
“There are just a massive amount of vacancies on the other side of the hill,” said Jim Reed, Scotts Valley councilman.
Reed noted that other companies, like Seagate Technology, have been lured away by a larger talent pool and rock-bottom prices for buildings.
“As low as some of the office space is here, it’s not as low as it is over the hill. There’s just such an enormous glut of quality office space. The deals largely make themselves.”
Reed, however, said there are also some glimmers of light as the city draws new startups to the community as well.
“In these economic times, any loss like this is difficult,” said Donna Lind, vice mayor. “We hate to see them go.” Lind pointed to ongoing city efforts to offer incentives and market the community as pro-business. “We’re really being proactive to let businesses know they’ll be valued here and we’ll work with them.”
This article was published here.