Raleigh tech firm Bandwidth is betting millions on a full return to the office – Raleigh News & Observer


While most technology companies in the Triangle are fully embracing hybrid work, Bandwidth is doubling down on working in the office in-person.

Since June, the company — which makes software that helps with voice and text communication — has told its employees that it wants to see them in the office five days a week. If that isn’t going to work for them, then the company is giving them time to find a new job.

It’s a decision spearheaded by its CEO, founder and leading personality, David Morken, a former Marine who carries the intensity and energy of a seasoned triathlon competitor.

The decision is driven by a fear that the company’s culture will decline without in-person work.

“I do think that … there is a real decaying half-life to a vibrant company culture when you are remote,” Morken, 52, said inside a conference room at Bandwidth’s office on N.C. State University’s Centennial Campus.

“I understand that is a conviction that not everybody shares,” he said. “But we want to be a team that attracts others who value being in the moment, being present, collaborating together — through agony or ecstasy — just like you want to be present in life moments.”

It’s betting tens of millions of dollars on that opinion, too. On Monday, it broke ground on a new headquarters off Reedy Creek Road, and it has plans to hire more than 1,000 workers in the coming years. The new campus will include among many things, a soccer field and a Montessori school that will be open to the children of any worker on campus.

Bandwidth is not requiring its employees to get the COVID-19 vaccine, but Morken said it made a big push to help vaccinate its workers, offering time off, information about access and travel arrangements.

Through the glass walls of the conference room behind him, the office teemed with mostly 20-somethings working on the sales floor. The office was full of chatter, with people on phones in cubicles and talking to one another at stand-up desks. No one wore masks at the time of this reporting, and in the open kitchen area, a line of Krispy Kreme doughnut boxes were being picked over.

In other words, it looked like a scene out of 2019, when most workers drove to an office five days a week.

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The planned campus of Bandwidth’s under-construction headquarters in Raleigh. Bandwidth

Hybrid work is popular right now

Morken’s decision to return comes as surveys show that workers would like to retain the option of staying at home. Some 54% of workers in the Raleigh-Durham metro area want to work fully remote and 37% will soon join the job hunt, the consulting firm Robert Half found. Many of the Triangle’s top tech companies are hedging toward flexible work, with major companies from Red Hat and IBM to SAS and Cisco embracing hybrid schedules.

Morken says the choice isn’t about productivity. Bandwidth, he says, was incredibly productive as a remote company — even more so than it was in 2019. The tools it makes and sells are the backbone to the services that made the pandemic manageable, like Zoom and Google Hangouts. Every time you call into a Zoom meeting or a Google hangout, Bandwidth is helping arrange the phone number and connection.

That led to a surge in revenue between 2019 and 2020, growing 47.5% to $343.1 million.

“Business exploded over night,” Morken recalled.

Throughout the pandemic, Bandwidth’s office never closed. The company’s customers include emergency services, making it an essential business. But, for the most part, the office space has been desolate until this summer.

“It’s contrary to my best business interests,” he said. “I should be saying everyone go home all the time because we’re powering the greatest tools to support remote work ever developed.”

“But the essence of what we value is this: presence,” Morken added. “… What we value highest in the hierarchy of human engagement is being together — whether you’re present at creation of a new product, present at the birth of your child (or) a proposal to your bride — being present matters in the moment. We’re committed to that.”

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A rendering of the under-construction Bandwidth office. Bandwidth

Morken said Bandwidth isn’t being draconian about it. “The expectation is we’re in-person five days a week, but we all have life events that have always taken priority,” he said, noting child care is an obvious issue for some and a big reason it’s building its own Montessori school.

He added the company offers 90-minute workout lunches, a no-email policy on vacations and a paid-leave day to support social causes of their choice. Morken, who says he often takes breaks to pray at work, focuses on a nonprofit he founded called DurhamCares that fosters collaboration between churches.

In job interviews, the first thing the company mentions is that it wants employees in the office five days a week.

“There are great teams out there that are going to be able to offer (remote work),” he said. “And so those folks who believe with conviction that that’s for them, they will choose to go to teams that allow them to be at home full time, or to have a hybrid approach. And that’s okay.

“We’re different. And that’s also okay.”

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Bandwidth CEO David Morken, second from right, breaks ground on his company’s new headquarters in Raleigh on July 19, 2021. Zachery Eanes zeanes@newsobserver.com

Morken said he believes that the death of the office has been called too soon, pointing to the fact that Apple and Google are investing millions into real estate in the Triangle as well.

“I would just challenge that (narrative). Google, Apple, Facebook have all acquired more square footage during the pandemic than they had any time prior,” he said, adding he doesn’t believe they are doing that simply for more conference rooms.

While coronavirus cases remain much lower than they were in winter, there has been a slight uptick in cases across North Carolina in recent weeks.

Morken said there have been no outbreaks of COVID-19 at Bandwidth, and he’s not worried about future ones popping up.

Competing for talent

During the pandemic, Morken said the mostly young workforce at Bandwidth was burning out — a factor he contributed to them being isolated at home. Managers, including himself, were struggling to lead.

“I think it’s harder to lead remote than it is to collaborate remote,” he said. “What I saw among our leadership was a challenge to convey, fire up, inspire, coach.”

When he walks around the office now, Morken said, he’s not sensing the same levels of burn-out.

Historically, Bandwidth’s turnover rate has stayed at around 10% every year, a spokesman said, a rate that is below the tech industry’ average of 13%, according to a 2018 report from LinkedIn. In recent months, that rate has been increasing — though the company did not give a number.

The U.S. is seeing record numbers of people quitting their jobs or making career changes. The number of people voluntarily leaving their jobs hit a record of 4 million people in April, according to the U.S. Bureau of Labor Statistics.

“A lot of companies and individuals put plans on pause (during the pandemic),” Ed Hintz, vice president of software development at Bandwidth, said of the current labor market. “It’s a great time to be a software developer.”

But Bandwidth isn’t expressing much concern that it will be able to hire over the next few months, and in the coming years when its new office is ready.

Does the arrival of Google and Apple to the Triangle worry Morken? He says it does not.

Morken said he welcomes more businesses to the area. He believes it will lead to more people moving to the Triangle, increasing the available talent pool from which Bandwidth can hire. But more than that, he’s confident that his company’s mission and culture will win over employees from larger companies.

“We will be poaching Apple employees left and right, picking them from the tree,” Morken said. “Can’t wait for the orchard to set up.”

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.

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