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When critics of LivingSocial’s $32.5 million tax incentive erupted this summer, they were concerned mostly that the deal would make D.C. a bit player in the company’s plans for worldwide domination. Just five months later, those complaints seem small; after a round of layoffs in late November, it’s unclear LivingSocial will even make it to 2016, when the tax credits kick in.
No matter. LivingSocial has a one-of-a-kind, built-in firewall against the inevitable disgruntlement produced by these sorts of mass disruptions: the Culture Team. D.C.’s homegrown coupon firm apes Silicon Valley’s predilection for ball pits, video games, and beer fridges, with a set of full-time employees to curate the a chill vibe. But official fun didn’t stop a deluge of bitter (and occasionally misogynistic) employee remarks in the comments on my November story on the company before the layoffs. And the Culture Team itself is getting a rebrand, as the company might put it: One of its two staffers was let go during the cutbacks.
The layoffs, the Culture Team—it all speaks to the fundamental tension gripping LivingSocial: feisty start-up or cutthroat corporation? It certainly grew like a start-up, hired like a start-up, and has the techy vibe to match (though selling online coupons doesn’t pass for “tech” in some circles; even Washington City Paper does that now). Now, it’s even crashing like a failed start-up. At the same time, it’s still a 4,000-employee company operating in more than 70 countries. LivingSocial is desperate to make some money, but it’s also eager to demonstrate that it hasn’t forgotten its hacker roots. Ironically, the firm’s efforts to preserve that start-up vibe make it look a lot more like a stiff, PR-conscious corporation. “They want to be mom-and-pop,” says Matt Corrado, who booked shows for their 918 F event space downtown. But they also “have a big ego behind what they’re doing, and think that their brand can’t be tarnished.”
I felt no schadenfreude when the layoffs were announced. Despite LivingSocial’s confused and sometimes creepy company culture, it’s hard not to see the benefit of a massive, young company planting its headquarters downtown—diversifying the local economy, employing hundreds of residents, filling office space. If LivingSocial crashes and burns, along with its Chicago-based rival Groupon and the rest of the daily deals market, we can claim savvily that the writing was on the wall, that D.C. was never going to be more than a company town for the federal government. Maybe so, but that doesn’t mean we should be hoping for it.