Winning Trilliant’s headquarters takes selling North Carolina with skill.

Challenge: Securing a headquarters location with an affordable cost of living and access to skilled technology workers.

Solution: An industry trade group teams with local and state job recruiters to identify sites with a strong “livability” factor and near world-class universities to provide a pipeline of talent.

by D. Lawrence Bivins

The journey from Redwood City, Calif., to Cary, N.C., spans more than 2,800 miles. But the two communities are separated by more than just a continent. For starters, median home values in Redwood City approach $1.4 million, versus $339,000 in Cary, according to Zillow research.

Executives at Trilliant Networks expect the relocation of their global headquarters from a Silicon Valley community 27 miles south of San Francisco to a leafy Wake County suburb will position the company for continued success in the burgeoning clean-technology industry. “Coming from the Bay Area, the cost of living had become a burden that contributed to commute times,” says Ryan Gerbrandt, senior vice president of global solutions. “A large fraction of our workforce had an hour and a half commute.”

Exorbitant housing costs and epic commute times are common in Silicon Valley, and Trilliant’s employees were not alone in noticing. Sixty-three percent of Bay Area renters cited cost-of-living as the main factor prompting them to explore leaving the region, according to a recent survey of renters by Apartment List, a San Francisco-based apartment search engine. Ten percent said commute times were the top reason they wanted to live and work somewhere else.

“You have to look at the best place to grow,” Gerbrandt says. “In Redwood City, the cost of human capital was expensive. We were competing with Apple, Google and eBay for talent, and it’s tough.” In April, Trilliant unveiled plans to bring 130 jobs to Cary over five years. About half will be employees relocating from the California office. The company will invest $1.8 million in its headquarters near Interstate 40. “We paid a lot of attention to quality of life and living conditions,” Gerbrandt says.

An engineer by training, Gerbrandt joined the company in 2007, helping pioneer Trilliant’s smart-grid solutions that are sold to utilities and other buyers to measure, analyze and report usage patterns. The technology helps clients identify opportunities for energy efficiencies. Trilliant says it offers the only enterprise-wide, smart-energy communications platform for connecting the Internet of Things, the network of electronic sensors, software and computing gear that collects performance data for companies and communities. Investors in the privately held company include ABB, GE and several private-equity companies.

The company’s global growth prospects are supported by widespread changes gripping utilities and their customers. Substation transformers in use today, for example, were designed for a 40-year shelf life. Most have now surpassed that life expectancy by two years, on average. Twenty-four U.S. states have adopted Energy Efficiency Resource Standards, strategic targets for energy savings that are fueling investments in efficiency programs by utility companies. And increased adoption of electric vehicles is expected to fundamentally alter the energy-consumption landscape. Worldwide sales of electric vehicles are expected to surpass internal-combustion engines by 2038, according to a 2017 Bloomberg report.

“Clean tech is about more than just turning off the lights when you leave a room,” says Susan Sanford, executive director of the Research Triangle Cleantech Cluster (RTCC). Founded in 2013, the organization, part of the Research Triangle Regional Partnership, builds collaborative ties among clean-tech firms in Wake, Durham and surrounding counties. Its 65 members include companies in energy distribution and water management, as well as the law firms, research organizations and engineering companies that support them. “Because we have such a strong base in analytics here, we’re really positioned well for all these smart technologies,” she says, adding that the region is home to the largest concentration of smart-grid companies in the world. Some RTCC members, such as ABB, Siemens and Schneider Electric, were already Trilliant business partners. “We wanted [Trilliant] to know how strong our talent pool is and that we, as an organization, would be here to support and connect them,” Sanford says.

The region’s prowess in clean technology began developing in 1954, when Westinghouse Corp. relocated its electricity-metering division from New Jersey to Raleigh. A decade later, IBM began building its massive hardware and software operations at Research Triangle Park. Computer-networking giant Cisco Systems later joined them. Homegrown software and data-analytics companies such as SAS Institute added to the mix, making the region a one-of-a-kind intersection for hardware, software, network solutions and business analytics. Along the way, the region’s colleges, universities and K-12 school systems developed curricula to feed the growing demand for qualified workers.

“Talent and human capital in this area are what most companies are interested in,” says Kyle Greer, vice president of economic development at the Cary Chamber of Commerce. What distinguishes Cary is both a reliable pipeline of local workers with the right credentials, plus a livability and affordability that make it easy to recruit new arrivals from around the world, Greer says. “You get the same caliber of talent from inside or outside.”

In recent years, Cary has adjusted community-planning strategies to accommodate opportunities to land companies like Trilliant, known during the company’s search as “Project Gemstone.” Policies are now designed to spur development of more mixed-use, walkable environments. “Cary is certainly evolving its inventory to meet what the market wants,” Greer says. The shift has resulted in communities such as those near Weston Park that offer high-quality office space, apartments, hotels, shops and restaurants. “Companies like Trilliant are telling us this is what they want.”

Before arriving at Cary’s Weston, Gerbrandt and his colleagues had to narrow a search that included technology-oriented destinations in Atlanta, Boston, Denver, Nashville and Tampa, Fla. “They started off looking at targeted metro areas” that included the Triangle, says Christopher Chung, president and CEO of the Economic Development Partnership of North Carolina Inc., the public-private partnership that oversees corporate recruitment. The state’s conduciveness to global-headquarters operations, including a low cost of living and top-ranked business climate, was an early factor. In the case of Trilliant, the testimonial of chairman and CEO Andy White ensured North Carolina was given serious consideration.

White had headed GE’s nuclear-energy division when it moved its global headquarters from Palo Alto, Calif., to Wilmington in 2003. The rationale was nearly identical: keeping costs down in attracting and keeping top-caliber, international talent. Four years later, GE cut the ribbon on its Nuclear Energy Advanced Technology Center. Today, in partnership with Japan’s Hitachi Ltd., GE Hitachi Nuclear Energy is one of the Wilmington area’s largest and highest-paying employers. After leaving GE, White maintained his contacts with North Carolina economic-development and government leaders.

In paring down the list, Trilliant did not engage a site-selection consultant. But the work of commercial real-estate broker JLL helped the company zero in on its office-space options. Berkshire Hathaway Home Services assisted as the company pondered various corners of the Triangle. Company leaders were surprised by the eclectic patchwork of towns and cities in the region, says Cecily Durrett, Berkshire’s Raleigh-based director of relocation and business development. “The Triangle is a double-edged sword: There’s a lot of choices, but there are also a lot of choices,” she says.

Choosing Cary’s Weston community came down to cost and available real estate, Gerbrandt says. “Affordability varies quite a bit as you go up and down I-40,” he says. “Cary has some advantages there.” The company also had a detailed vision for its building. The space needed to accommodate 130 employees and prominently feature the company’s brand outside. “We wanted to have a significant claim on the building that houses our headquarters.”

The Triangle’s diversity — both in terms of people and communities — impressed Gerbrandt. “That was a strong selling point,” he says. “A lot of our folks come from diverse backgrounds.” He also noticed the region’s abundance of recreational and cultural amenities, from NCAA and NHL sporting events to history and science museums, and its strong educational offerings. “The university system here is among the top you’ll find anywhere,” Gerbrandt says. He was similarly confident that the Triangle’s K-12 schools would measure up to the expectations of Trilliant employees with children.

Accessibility to the company’s global markets also was a factor. Trilliant has an office in Toronto and a research and development center near Montreal, as well as operations in London, Singapore and Kuala Lumpur. Raleigh-Durham International Airport’s direct commercial air access to Canada and Great Britain provides convenience. “The only compromise is in the extra hop when we go into Asia,” Gerbrandt says. Service out of RDU also puts the company within easy reach of customers in Latin America and the Caribbean, two growing clean-tech markets, he adds.

State financial incentives for the expansion include a Job Development Investment Grant (JDIG) award of up to $1.3 million over 12 years. JDIG awards return a portion of state personal income-tax withholdings once jobs have been created at agreed-upon average wage levels. Cary officials must meet requirements for a modest local incentive “match” pursuant to state law.

“The incentives were part of the evaluation,” Gerbrandt says, citing the cost of a coast-to-coast relocation. “Was it the sole reason? No,” says Gerbrandt. “Was it a consideration? Absolutely.”

But access to talented workers ultimately accounted for the company’s decision to make Cary its corporate base. “We liked the peer group we found in the region,” Gerbrandt says. “That feeds into the talent side and also having like interests.” Being part of a cluster of clean-tech companies offers opportunities for synergies that can facilitate growth of the entire industry. “We can compete but also partner within a model that helps all of us be more successful.”