Case sees Hawai'i as business model
By Deborah Adamson
Advertiser Staff Writer
Hawai'i's companies have an opportunity not only to be drivers of the economy, but to promote social change for the good of the community, AOL Founder Steve Case told local business leaders yesterday.
Deborah Booker • The Honolulu Advertiser
At a Hawaii Business Top 250 luncheon in Waikiki, the former AOL Time Warner chairman, who was named by Forbes magazine as one of America's 400 richest people, spoke about a new paradigm for Hawai'i businesses that could be used as a model for the rest of the country.
Punahou graduate Steve Case says the online frontier will include an "always on" Internet and more wireless devices.
"I saw Hawai'i as an opportunity to invest in a new kind of business paradigm — to create and support businesses that would generate social benefits as well as financial returns ... not only to make a profit, but make a difference for a place I really love," said the 46-year-old Punahou graduate.
Case points to his investments in Maui Land & Pineapple and Grove Farm in Kaua'i as examples.
Case brought in David Cole, a fellow AOL executive and kama'aina, to run Maui Land & Pineapple, a real estate, agriculture and retail company.
One mandate for Cole and his management team was to move beyond the business of selling land and buildings to create whole communities that reflect island values. It is exemplified in a new community called Pulelehua, which offers affordable housing for workers in West Maui, Case said.
He sees similar projects in store for Grove Farm, a major landowner and developer, to help residents of Kaua'i.
But for the state to develop a more vibrant economy, it must retain its brightest minds, offer compelling business opportunities and provide adequate access to capital. One major challenge is the problem of affordable housing and lackluster pay scales.
Some Hawai'i natives who have moved to the Mainland find it difficult to return to Hawai'i's "Manhattan prices and Midwestern paychecks," Case said.
Hawai'i also needs investment capital, preferably raised locally, so "promising companies don't have to move to California to grow," he said.
Case said Act 221 — the controversial tax breaks intended for tech companies but also claimed by non-tech businesses that invested in technology — was a good try.
He sees the next online frontier as an "always-on" Internet, wireless devices and adoption of the Net by industries such as healthcare.
Small startups that turn into conglomerates have a domino effect that lift the economy as a whole, Case added. Asked why he didn't base America Online — later to become AOL Time Warner and now Time Warner Inc. — in Hawai'i, he said it was the circumstances at the time.
"I was living in northern Virginia at the time" and it just happened, he said. "There's no particularly reason why we started there."
Case lives in Washington, D.C., but flies to Hawai'i every two to three months. He stays with his parents on O'ahu because he doesn't own a home here.
His involvement in Hawai'i has increased since he resigned as chairman of the former AOL Time Warner in January 2003 to avoid a protracted boardroom battle after America Online's fortunes sank after its merger with Time Warner.
As to why he came back, Case said that "Hawai'i gave me a great start in life. Now it's my turn to give back. ... I truly believe Hawai'i can be a beacon of opportunity — a place where kids don't have to leave home in order to follow their dreams."
"But I also believe that we must be willing to risk on behalf of that vision," he said. "If we don't bet on Hawai'i's future, then nobody else will either."
The luncheon was sponsored by First Hawaiian Bank, Hawaii Business magazine, Matson Navigation Co. and PricewaterhouseCoopers LLP.
Reach Deborah Adamson at dadamson@honoluluadvertiser.com or 525-8088.
