A tech startup’s highly touted move from Austin, Texas, to a sizable new headquarters in Richmond isn’t happening after all.
Vytal Studios, after announcing plans in conjunction with the governor’s office last year to relocate from the Lone Star State to Manchester and bring with it 155 jobs, has canceled those plans.
A lease the company had for a 22,000-square-foot office in a former warehouse at 1802 Semmes Ave. has also been terminated.
Vytal CEO Jim Smith said that when the company leased what was to be its future home, it also anticipated new investment capital to grow its operations. That investment ultimately didn’t materialize and made the lease untenable.
“We based every decision we made on contractual commitments,” Smith said in an interview Wednesday. “The folks who own the building were concerned we wouldn’t be able to pay rent and they were probably right and they were graceful enough to terminate the lease.”
Founded in Austin in 2018, the company makes new employee training and orientation content with extended-reality simulations for businesses.
Its plans for the headquarters move were announced by former Gov. Ralph Northam’s office in early 2021.
It planned a $6.8 million investment in the building for studio space, post-production and development offices. At the time of the announcement, the company said it had about 20 employees in the U.S. and internationally and planned to fill out the 155 jobs it planned for the Manchester headquarters over the course of several years.
Today the company is based in Richmond as a remote outfit that continues to operate, though it has no employees currently other than Smith.
“It’s pure startup mode, which means raising money,” Smith said.
The Vytal project was eligible for financial assistance from the Virginia Economic Development Partnership. Spokeswoman Suzanne Clark said last week the funding wasn’t ultimately distributed to the company.
“VEDP learned from Vytal that they terminated the lease at 1802 Semmes Ave. Given this information, both the Commonwealth’s Opportunity Fund and Virginia Jobs Investment Program grants were canceled, and no incentive payments were made to the company,” she said in an email.
Will Allen of Harper Associates, which owns the Manchester property, said new plans are being drawn up for the site.
“Regarding the property, there are plans in the works to include the 1802 Semmes parcel with recently assembled property resulting in a revised zoning application that will better harmonize as a whole with the Richmond 300 Plan,” Allen said in an email this week. “As the details of that approach become clear, we look forward to sharing more information.”
Richmond 300 is the city’s long-range roadmap for growth. The City Council adopted the plan in late 2020 and is weighing further amendments to it. The plan’s vision for Route 1 is focused mainly on mixed-use development. The property is at the corner of Cowardin Avenue (Route 1) and Semmes Avenue.