Boston Tech Scene Gains Big Anchor Tenant in General Electric
EMC, schmee-MC. We’ve got GE now.
General Electric, one of the world’s biggest companies, will relocate its global headquarters from Fairfield, CT, to Boston, as first reported by the Boston Globe.
The move was prompted by a change in corporate-tax policies in Connecticut last year. Boston ended up beating out New York and other cities in the effort to lure the technology and energy giant. The new headquarters, likely to be in the Seaport area of South Boston, is slated to employ about 800 people; the full move will be completed by 2018, the company said. (GE already employs thousands in Massachusetts, according to the Globe, even as it has eliminated some factory jobs in the state.)
General Electric (NYSE: GE) has a market capitalization of $285 billion, which will make it by far the biggest publicly traded company based in Massachusetts. For comparison, Biogen’s market cap is about $60 billion, EMC’s is $47 billion, Vertex’s is $25 billion, and TripAdvisor’s is $11 billion. GE’s valuation is comparable to that of Facebook or Amazon.
Like other big, established companies, GE has been investing in software and innovation in areas like healthcare, Internet, and smart manufacturing. It sounds like the combination of Boston’s educational institutions and tech and life sciences businesses—along with state aid and tax incentives, of course—swung the decision in Boston’s favor.
In a statement, GE’s chief executive Jeff Immelt said, “We want to be at the center of an ecosystem that shares our aspirations. Greater Boston is home to 55 colleges and universities. Massachusetts spends more on research and development than any other region in the world, and Boston attracts a diverse, technologically fluent workforce focused on solving challenges for the world.”
The news runs counter to a popular narrative of the Boston-area tech cluster: namely, that promising startups and entrepreneurs often leave town for places like Silicon Valley (see Facebook, Dropbox, Meraki). And that homegrown companies often get bought out by outsiders after reaching a certain size or age. (See DEC, Genzyme, Acme Packet, Endeca, EqualLogic, and, of course, EMC, for big examples.)
The Globe report notes that “GE’s choice cements Boston as a hub of innovation in technology and life sciences.” The truth is, Boston innovators will need to do much more to remain competitive. But now they have a new and powerful ally to help them do just that.