Citing favorable tax rates, Flowroute moves HQ to Seattle from California

Flowroute, which provides wholesale voice-over-Internet services to businesses, has moved its headquarters from Southern California to Seattle.

The company cited Seattle’s favorable tax rates and low cost of living as reasons for the move, as well as the general “vibe” of the city, close to hiking and biking trails. Washington state is one of the few states in the U.S. that does not have an income tax, though a report out last week indicated that the state had the “most regressive” tax system in the country. (SeeWelcome to Washington: The best place in the U.S. to be rich and the worst to be poor)

“We looked at a few cities, but when the two other founders and I came to Seattle, we really liked the vibe – the quality of life, the balance,” said co-founder Bayan Towfiq. ”That’s important to us. Seattle is a vibrant city.”

Bayan Towfiq

Flowroute says that its revenues have doubled every year since it was founded in 2007, and now it routes more than 2 billion minutes of telecom traffic annually on behalf of thousands of business customers. Being located in Seattle will help support the company’s growth, as well as nurture expansion, said Towfiq. 

“The Pacific Northwest’s tech hub offers a talent pool that fits Flowroute to a tee,” he said. “Washington also is a friendly environment for business growth, with attractive tax rates, and the low cost of living is great for everyone at Flowroute.”

As a result of the deal, the entire team is moving to Seattle. The company currently employs 17 people, with plans to add another 10 by the end of the year.

Flowroute previously had been based in Irvine, California, and the new offices are located at 1221 2nd Ave. in Seattle’s financial district. The company also has named former Microsoft staff attorney Ron Rice as executive vice president and chief legal officer, Jeff MacKay as advertising and technical writer; Will Carter as media coordinator; and Joe Hillenbrand as software engineer.

Post updated at 11:30 am. to correct the number of minutes of telecom traffic routed by the company.

  • Guest

    Nice! Welcome guys!

  • http://www.adamlieb.me/ Adam Lieb

    Welcome. We made the same move about 8 months ago for many of the same reasons. So far it has been a great move.

  • RunTheNumbers

    This is interesting. All the recent debate has been about how Seattle needs to do more for entrepreneurs and grow the startup eco-system, and yet the appeal to the area for these guys was cost-of-living, tax structures and access to talent.

    • tryingtocalmdown

      The issue is a little different. This company is fairly well established and is now finding Calif to be a burden (the founders probably just calculated their tax bite to Calif.). This isn’t a startup looking for legal or HR advice. While the Puget Sound area is improving in terms of supports for entrepreneurs, we can do better.
      I just hope these guys from Calif understand the B&O is on the gross, not the net…

      • accounting 101

        Of course they know. Probably already setting up the legal entities that will enable them to avoid most of it.

  • http://twitter.com/alwaysbshipping Tom Leung

    Nice. Welcome to Seattle guys!

  • NorthwestPassiveAggressive

    Welcome, but just be sure to remember all the reasons you decided to leave California. So many Californians who move to Washington mindlessly end up trying to change Washington into the place they escaped from.