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Lack of cash forces the former Tampa company to close, costing 121 jobs, including 87 in Tampa.
By KRIS HUNDLEY
© St. Petersburg Times, published May 2, 2001
Two weeks after warning employees that the end was near, 2nd Century Communications Inc. shut its doors Tuesday, putting 121 people out of work.
Eighty-seven employees in Tampa and 34 in four other cities were given pink slips by the telecom company. 2nd Century, which was started in Tampa in 1998 and relocated its headquarters to suburban Washington a year ago, offered local, long-distance and Internet access to businesses. A handful of workers will be retained to maintain services temporarily while customers find new carriers.
Once a fast-rising local success story, 2nd Century ran out of cash after burning through $175-million in less than three years. While the job losses are just the latest fallout of the economic slowdown, 2nd Century's local workers were better off than the average Tampa Bay area employee: The average salary at the Tampa network operations center was $65,000 a year.
"It's going to be very difficult for those people to find comparable jobs in this area," said 2nd Century founder Oscar Williams, who left the company in August 1999. "These are highly trained technical people with good skills, and economically, Tampa needs these jobs. But the market is not here."
Williams and three former colleagues at Intermedia Communications Inc. started 2nd Century in 1998 with the idea of replicating Intermedia's infrastructure and service at a lower cost. But Williams and Mike Viren, a co-founder, said major investors pushed the company to move into multiple markets before making a profit in any of them.
"We wanted to grow the company slowly, using revenues gained in one market to open another," said Viren, who left 2nd Century in early 2000. "But the investors said the way to please Wall Street was by having a big base, even though you have a fragile infrastructure. All they were doing was growing the footprint; they were barely able to provide even the basic service."
Last summer, 2nd Century was in 28 markets with 500 employees. In September, the company ran out of money. Sales couldn't match investors' ambition: 2nd Century never had more than 300 customers nationwide.
Joe Tedino, spokesman for the company now based in Rockville, Md., said workers would receive severance pay of up to 12 weeks' earnings.
"The decision to close was very painful to make," he said. "Like many companies, we were faced with trying to raise additional capital, and we were unable to do that."
Viren, who now runs a venture capital company with Williams in Tampa, said he was sorry to see his disastrous predictions come true.
"The four founders still own about one-eighth of the company," he said. "But this is an awful way to say I told you so."
-- Kris Hundley can be reached at hundley@sptimes.com or (727) 892-2996.