On the heels of posting part 2 of my interview with Charlie O’Donnell of First Round Capital about why New York is a great place to start a technology company The New York Times published an article in today’s Technology section about the very subject.
Yesterday I interviewed Nate Westheimer, the Executive Director of the New York Tech Meetup, co-founder of Anyclip and advisory to Flybridge Capital. In that interview, which will be published here later this week, Nate also talks about why New York is the best place to start a technology company.
In the meantime, here are my favorite excerpts from today’s NY Times story:
Of course, services can be developed anywhere. But because so many industries now grappling with the Internet are based in New York, the city is finding surer footing among its peers as a thriving tech hub.
“Book publishing, advertising, media and even the fashion industry are all located in New York. These are the main industries that are being reshaped and redefined by technology and the Internet,” says AnnaLee Saxenian, a professor at the University of California, Berkeley, who studies regional economics and technology entrepreneurship.
To get a vivid snapshot of this new generation of Web innovation, one needs to look no further than the portfolio of Fred Wilson, co-founder of Union Square Ventures and a force within the New York start-up scene. Run through a list of Web darlings here — Boxee, software that pipes video from the Internet to a television; Tumblr, a microblogging platform; and Foursquare, a mobile social network — and Union Square is an investor.
“The software business has morphed into the Internet business,” Mr. Wilson says. “Ten years ago, maybe 80 percent of software was being built for enterprise. Now, it’s being written for consumers and is more media-centric than ever. And, historically, those have been New York’s strongest sectors.”
Champions for New York’s continued evolution as a hotbed for digital innovation say that the proximity to industries ripe for innovation helps draw companies in those fields.
Kevin Ryan, former chief executive of the ad company DoubleClick and founder of Gilt Groupe, a Web site that offers discounted luxury goods, knows the importance of having prospective customers in his backyard. “We need to be here because the people we’re hiring are coming from Saks and Dolce & Gabbana, and they are all in New York,” he said.
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HELPING to cultivate New York’s revival, entrepreneurs and investors say, is the proliferation of early-stage investment firms, start-up incubators and the cadre of successful serial entrepreneurs choosing to set up shop within the five boroughs of the city.
Ben Lerer, a co-founder of Thrillist, a popular daily e-mail newsletter aimed at hip urban men, recently raised $7 million for an investment firm he runs with his father, Kenneth. The two men plan to make as many as 25 investments in tech start-ups this year, 80 percent of which will be in New York, they say.
The elder Mr. Lerer is a co-founder of The Huffington Post. He also is an investor in Betaworks, an incubator housed in the meatpacking district that has helped nurture roughly 25 companies since it started in 2007, including the online tools Bit.ly and Tweetdeck.
Adding to the momentum are cash infusions from noted venture capitalists based elsewhere. Ron Conway, a San Francisco financier who was one of the earliest investors in Google, Twitter, Facebook and Zappos, says his fund has 25 investments in New York that account for roughly 20 percent of his portfolio.
“Just a year ago, it was less than half that,” he said in an e-mail message. “New York has become a hotbed of innovation,” he said. “Many start-ups there have as much promise as the best start-ups here in Silicon Valley. And the ecosystem of entrepreneurs, engineers, investors and other players is growing at a pace similar to Silicon Valley when it first got started.”
