Bubblews Moves to Costly Zipcode, Can't Pay Writers

On Tuesday, February 25th, 2014, Bubblews filed as a foreign entity in the state of California. What does this mean? Bubblews was originally based out of Fairfax, Virginia. When a business transfers to another state, they must file as a foreign entity. That is it. It is just a filing status for tax purposes. It applies to any business that transfers to another state.

Now. Here is the question that many people are asking- Why did Bubblews move if they are having trouble paying their writers? Well, Bubblews filed as a foreign entity on February 25th. It seems that the real issues with paying their writers didn't develop until much later- around August of the same year.

Bubblews is now located at 527 Howard street in San Francisco, CA. According to the Sperling's Best Places website, this particular zipcode is a fairly costly one. The Sperling site ranks the cost of living of various zipcodes in the United States. An average rating is 100. If a zipcode is fairly inexpensive to live in, its ranking will fall below the 100 mark. Anything over 100 is above average.

The zipcode that Bubblews chose, the overall cost of living ranks 253 on the Sperling scale. That is insanely high compared to many of the zipcodes in the United Sates. Do you see the housing cost? It scores a 547.

Screenshot from Sperling's Best Places.

Bubblews originally was located in zipcode 22030 in Fairfax, Virginia. This is a much more inexpensive place to live and conduct business, as you can see in the screenshot below.

Screenshot from Sperling's Best Places

So, the burning question is- why would a fairly new business who is still trying to evaluate their 'income' and how to pay their writers move to an area where the cost of living is incredibly high, instead of staying put and making a more sound plan for the future?

Here are a few ideas that have been floating around in various writer's groups- Could it be they wanted to be closer to family? Are the Bubblews staff trying to impress the media by appearing to have more money? We don't know at this moment.

All we do know for sure, is that Bubblews moved to a much more expensive area of the country to conduct business in early 2014, and in mid/late 2014, announced they did not have enough money to pay their writers. This kicked off thousands of writers being notified that they would not receive their earnings.

Bubblews showed inflated stats in the virtual banks of its writers. Arvind Dixit made this perfectly clear in his 'Perseverence' post on January 2nd, 2015 (which can be viewed HERE)-

"We reported lots of money that we didn't have. The money that you 'earned' never existed."- Arvind Dixit, CEO & Founder of Bubblews

*Assistant researcher: S. Golis. Golis is an assistant for hire that helps busy professionals research any topic. To contact her, visit her on Google+ HERE.