Why does nginx work at the server IP address only with default root location?

[Paul N. Pace]

I have set up a server on Rackspace using Ubuntu 12.04 and the nginx stable PPA.

Using the default root location of /usr/share/nginx/html the
index.html file is displayed when I call the public IP address of the
server.

If I change the root location to my own /var/www/example.com/public
the index.html file is not displayed.

Output of ll on /var/www/example.com/public:

drwxrwsr-x 2 www-data www-data 4096 Apr 21 04:13 ./
drwxrwsr-x 7 www-data www-data 4096 Apr 21 03:55 ../
-rw-rw-r-- 1 www-data www-data  624 Apr 21 04:17 index.html

This is the only change I make and I get the failure, but I don't
expect it. What am I doing wrong?