Pandora's second campus is far from Silicon Valley — here's why the streaming music giant fell in love with Atlanta (P)

piedmont park atlanta georgia

Pandora announced plans earlier this year to establish a second major campus in Atlanta.
The internet radio giant is filling positions in Atlanta quicker than it expected and now anticipates employing many more people there than it previously planned, CEO Roger Lynch said.
The company's move is part of a growing tech scene in Atlanta, which has attracted firms with its low cost of living and major universities.

You may not think of Atlanta as a high-tech hub.

Silicon Valley? Of course. Seattle, New York, and Boston. Sure. But Atlanta?

Well, believe it. The city's got a fast-growing tech sector. It's become a major player in businesses like financial technology and cybersecurity.

And earlier this year, when internet radio giant Pandora went looking for a place to set up a second campus that promised lower costs for the company and a better quality of life for employees than its home base in Oakland, it picked Atlanta. The company has been so impressed with the city so far, that it's accelerating its expansion plans there and now expects to employ many more people there than it did originally, CEO Roger Lynch told Business Insider in a recent interview.

"It's a really great music town," Lynch said. "It has a very diverse workforce, strong technology, great universities — and it's affordable."

Pandora announced earlier this year that it planned to expand its team in Atlanta from the 30 ad sales people it had there previously to about 250 people total over the next three years. The new hires were expected to include engineers, which had previously been based solely in Oakland.

Pandora is bullish on Atlanta

But the company will hit that 250-person target much sooner than it previously expected, Lynch said. And its total Atlanta headcount could eventually far exceed that amount, he said.

Roger Lynch, CEO of Pandora and former CEO of Sling TV "Frankly, I think we'll end up hiring far more than that, because we're just seeing such strong success with our hiring there already," Lynch said.

Since announcing plans to bulk up its Atlanta office, Pandora decided to allow all of its hiring managers to list and fill positions in Atlanta as well as Oakland. When they list both locations as possibilities, "inevitably they fill them in Atlanta much faster," he said.

Pandora's move was spurred in part by the high cost of living in the San Francisco Bay Area. According to the latest study from the Department of Housing and Urban Development families of four in the area qualify as low income if they earn $117,400 or less.

By contrast, HUD defines low income in Atlanta as a family of four earning $59,850 or less. As a result, Pandora can pay engineers who work there a little less, but they can actually live better, Lynch said.

"An engineer there, on good salary, can live extremely well," he said. In the Bay Area, by contrast, "you pay a lot of money, and you live in like a little box."

Pandora has an incentive to try to economize. The internet radio company has never posted a full-year profit since becoming a public company in 2011. Meanwhile, its revenue growth has been slowing as its ad sales have slumped. In January, the company announced it was laying off 5% of its workforce.

Pandora is only a part of a burgeoning Georgia tech scene

But Pandora's not the only tech company that's bought into the promise of Atlanta. With more than 195,000 tech workers, metropolitan Atlanta is now the sixth largest tech employment hub in the country, according to a report from the Technology Association of Georgia, a trade group. And tech employment there grew 3.2% last year, a faster pace than even in Silicon Valley, according to TAG.

Financial technology firms Global Payments and First Data are based in the Atlanta area. So too are the technology solutions group of healthcare giant McKesson and cybersecurity companies Ionic and NexDefense.

Besides its low cost of living, another attraction of Atlanta is its universities, which include Georgia Tech, Emory, Georgia State, Spelman, and Morehouse. Georgia Tech in particular is one of the top-ranked in the country and produces a large class of engineers each year. What's more, it graduates more women engineers and more engineers who are members of under-represented minority groups than any other US college.

"It's the talent that's really attracting people," said Hala Moddelmog, president and CEO of the Metro Atlanta Chamber. George Tech, specifically, offers "that built-in diversity that many of these tech companies are looking for."

But Atlanta has other attractions, she said. Among them the country's most traveled airport, nearby natural attractions in the form of mountains and lakes, and a thriving music scene, she said.

"We have a lot to recommend," Moddelmog said. "It's a great place to live."

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