Inside Facebook's Company Town

Inside Facebook's Company Town

When you think about company towns in America, your mind turns to the days when miners and steel factory workers toiled for 12 hours a day then went home to small houses provided by the company. With the decline in factory labor, these towns disappeared. Yet, Facebook is about to bring the concept back. Unlike a mining town, however, it's looking to up the cool factor while enticing new workers to come.

After being granted approval from the city of Menlo Park, Facebook has started construction on a $120-million, 344-unit housing community just steps away from the main campus of the company. According to the company, the goal of the new housing development is to lure engineers and the best talent to these "adult playgrounds" where techies can be free to mingle and bounce ideas of each other, a key component in the social media industry.

Taking its cue from Google and their infamous "Googleplex" that the project is based on, Facebook operates like a small town. Employees get perks of large green spaces, free frozen yogurt, a bike repair shop, and a stadium-sized theater for movie nights, fitting in with the college campus feel Facebook created since moving to Hacker Way.

Facebook insists that the housing project isn't for employee retention, but more to make it easier for new workers to find a convenient place to live in a city that has been progressively getting more expensive. In the fourth quarter of 2012, real estate prices in Menlo Park jumped 24% with the local tech boom .

The community would include affordable housing units as well for lower-income residents, and the housing wouldn't be just for Facebook employees ... though given its proximity to the company's HQ, it was definitely designed with corporate bonding in mind. Regardless, it will create more housing in Menlo Park, which could drive down real estate costs and hopefully build greater relationships between Facebook and Menlo Park.

Although corporate bonding is key for a successful work environment, the housing project does have some drawbacks. The old mining towns were frowned upon, and eventually became obsolete, because they were seen as too "overbearing" for workers. Living and working on the same property can create a lack of separation between work and personal life, creating a sense that employees are always working even when they are not.

In addition, technology -- unlike 19th century industrial labor -- is a very "fluid" industry with employees coming and going and companies rising and falling quite frequently. This has cast doubts as to whether a company town could exist in such an industry.

While these drawbacks are something that Facebook may be worried about, for good reason, the housing project will most likely be a positive for the company. It creates more living space within the city, and also includes a bike path linking the city to San Francisco, which is only 5 minutes away.

Even more important, it improves community relations on something other than Timelines and Pages, which has become an important part of corporate social responsibility over the last few decades, especially when new companies look more like university quads than office towers.

Within the campus, it increases the ability of workers to bounce ideas around non-stop, which might hurt the work/personal life divide. But because of Facebook's popularity with employees, it might not be as pronounced a problem as some might think it is.

For a modern company, rehashing old ideas about workplace communities can be an expensive risk, yet coding and free-wheeling creativity are a lot more enjoyable than pickaxes and dark pits. Add in a workforce that might just be out of college (and suffering from that "I'm all grown up now, I miss playing beer pong and going to trashy bars" nostalgia) and it would almost be like home for some of the newer workers.

Isn't that worth a Like or two?

Tired of watching your stocks creep up year after year at a glacial pace? Motley Fool co-founder David Gardner, founder of the No. 1 growth stock newsletter in the world, has developed a unique strategy for uncovering truly wealth-changing stock picks. And he wants to share it, along with a few of his favorite growth stock superstars, WITH YOU! It's a special 100% FREE report called "6 Picks for Ultimate Growth." So stop settling for index-hugging gains... and click HERE for instant access to a whole new game plan of stock picks to help power your portfolio.

The article Inside Facebook's Company Town originally appeared on

John McKenna has no position in any stocks mentioned. The Motley Fool recommends Facebook and Google. The Motley Fool owns shares of Facebook and Google. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.