NYC tech catching up to Silicon Valley, while Seattle flails
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- The dot-com bubble in the early 2000s left a bad hangover, but also built up a set of young people with tech experience and lots of ideas who enjoyed working for non-traditional companies
- Those people often went to go start their own companies (disclaimer: I am one of those people). In the early 2000s, though, it was tough to find top tier VCs who were willing to invest in NYC. I remember in 2004 meeting a VC who said they would love to invest at a great valuation if we committed to moving the company to boston or the bay area
- Consequently, the selection criteria for NYC companies who got VC funding were often those with strong revenue streams, which led towards less sexy, less "moonshot" companies to those that sold products for actual money.
- The other driving criteria was those where geography was an advantage, which also led to financial services/enterprises or advertising
- As those businesses grew, expanded, raised more capital, it drove more VC money to NYC, which created more air in the room for more startups.
It's really a very straightforward evolution. As far as why Seattle "flails", I think it's even simpler - Seattle has a population of 650k people. A handful of large companies, Microsoft, Amazon, etc. can take a huge percentage of the engineering talent, and there's neither the educational base of graduates that the bay area or boston offers nor NYC's base of large corporations to sell to.
My time at 3 startups while in NYC were mostly the same. The founders and exec team looking at the engineers like a dime a dozen work force that they could easily replace. When I moved out west it was a shock that engineers were held with high regard.
Things may have changed but that's the main reason I felt was holding NYC back.
Also, NYC has like 3 big VCs: Union Square Ventures, Union Square Ventures and Union Square Ventures.
So you really just have to stop pretending and get in front of Silicon Valley VC firms that all have a variety of different interests and objectives. They also don't want to talk to anybody not in SV.
As far as the general mentality of paying it forward goes, I've got a healthy sense of cynicism towards that (maybe it's the new yorker in me). I find successful individuals are equally supportive here as in the bay area, but in NYC there's a lot less of the ridiculous hustler optimism that technology can cure all ills, and fewer ridiculous startups get funded out here.
But sure, yes, SV is much bigger than NYC, that's not in doubt.
It's probably just a common thing with startups in general.
NYC definitely has a "money up front" attitude, but the enterprise ecosystem is really taking off here in part because there are so many customers, but also because of the great community builders like http://www.work-bench.com/
That makes sense -- a disproportionate number of LA startups are in Media and Entertainment for similar reasons.
2. NYC tech portfolio is lacking startups in emerging technologies - self driving cars, VR/AR, 3D printing, drones, robotics, space, batteries and charging, energy
3. Lots of high profile failures, but few high profile exits
There's nothing actually like Silicon Valley in reality, though. This place is unique. Paris for fashion. New York for...(a lot of things) Hollywood for movies. Dallas for cheerleaders. St. Louis for half a McDonald's sign. Some places will never be duplicated.
Pretty sure the list is pretty long when all comes to all.
Yahoo pulled another broadcast.com on that one.
I'd also bet on at least two of these being >$50b within 3y. {Uber, Lyft, Airbnb, Didi, Meuitan, Ola, Flipkart, Snapchat} (Uber already is, so it's really "a second one")
Makerbot (3D printing) started in NYC in 2009 and is still there.
Within the next few years Facebook, Google will have huge headquarters (currently under construction or planning) right next to Amazon's collection of buildings in Seattle, and Microsoft near by.
I think the issue startups have in Seattle is they expect to pay less than in SV, because cost of living is cheaper. However with some negotiation the Big 4 will pay you the same as in SV, while paying a quarter of SV rent for a nice apartment with a walking commute.
I guess that lingering smell of urine keeps people coming back to SF?
Having grown up in Seattle and now working SV, I think the issue is the combination of being too close to SV, and not having the funding.
Obviously NYC has all the money you could need for a startup scene. Whether enough of it is being sent to startups can be argued, but the money is there. That, and it's a massive city near other massive population centers, and nowhere near the Valley. I think proximity to one big "scene" can hurt others.
That's true. Seattle has the frequent rain to wash smells like that away.
I like the weather.
There are some people who will live cheaper by commuting from the East Bay and pocket more of the money while spending less on rent. It's not all cut and dry.
Also, culturally, I don't think Seattle has a high risk appetite, and there's a pronounced anti-commerce attitude among many of the long-term locals.
In Seattle, I have talked to many employees of Amazon and Microsoft and they seem more proud of working at a top big-name company. They are working on products that are already used by millions of people around the world. When I mention that I work on no-name startup, I sometimes get the feeling that they feel bad for me. It's like "Oh that's cute, if you are looking for real job, I can probably get you in at Amazon".
I really wish that this weren't so prevalent. Sacrificing your ambitions to provide stability and safety for your family is a noble thing, and I wish the public rhetoric appreciated this more.
It's beneficial to the world to encourage people to take some level of risk. It's bad to encourage people to take stupid risks, but it's also a bad outcome if the next Elon Musk decides to spend his life working as a line engineer somewhere forever for safety. This is one of the biggest problems with inequality/etc. -- a person from a poor background gets a $20/hr job and would be unable to do anything which puts that at risk, even if it has a huge positive expected value. A rich person could comfortably optimize for EV.
(Incidentally decoupling survival from wages is one of the big benefits of basic income; it's possible this would lead to a more beneficial deployment of human capital and thus greater wealth overall.)
2. Seattle is a huge city with a ton of people, saying "Seattle doesn't have a high risk appetite" is a pretty absurd generalization. It'd be best to talk about specific causes and effects rather than making assumptions about millions of people's psychology.
2. The Puget Sound region is 2 million, roughly. Seattle is 650K, roughly. These are not huge by any global scale, even in the American scale. As I am reminded by the Seattle Times, the PI, and the Stranger (particularly), techies are not really welcome by the True Seattlite, and we aren't Welcome - (this is even true on reddit r/Seattle, which is the techiest of the techy). The grandiosity and merchantilism that characterizes NYC and SF isn't here. It's more about getting up at 6, working out, working hard 8-5, then going home or the bar, turning in at 11. Not doing whack experiments in a coffeeshop all night long to turn into a company. Generalizations, I know, but it's a constant drumbeat; it's the way the city is.
https://cdn-images-1.medium.com/max/1200/1*Uva0USM-qa8W_TByj...
For a second I thought it was only showing pre-IPO companies, but then I saw that Twitter and Facebook are on there.
It's even more entertaining because Spotify is shown at their old address, which is actually the Google NYC building.
Dropbox is also missing but I'm guessing that's because its NYC office was too new for this map (Kickstarter has also recently moved to Greenpoint).
And you may point to CA's Prop 8 passing as a counter-point, but I think one of the reasons for it passing was some voters assuming it wouldn't pass, and also the confusion of whether or not you're suppose to vote for/against if you're for/against same-sex marriage. Regardless, at least the State of CA fought against it and refused to enforce it.
Are you suggesting that the Bay area's success rests on the back of unimpeachable diversity? The demographics of Bay Area founders skews young, rich, pale and male. Women and non-whites tend not to have limited access to VC, as countless blog posts & news articles will attest. Heck, even white males from the 'wrong' schools struggle.
So you can strike out diversity as the engine driving the Bay Area, and likely not holding back NC.
"Macro trends", you mean like the Voter ID laws? The continued traditions of Jim Crow Laws such as keeping blacks from being in the jury of black criminals?
But hey, answering why someone wouldn't consider N.C. as a place to live by completely dismissing their opinions is definitely not poisoning the discussion right? And definitely not a social issue at all.
I think it's unfair a bit to single out NC specifically on HB2-like, voter ID, et al laws when it's a part of a broader national political initiative to push model legislation by one party (skirting the subject, look at the similarity in laws passed in states with conservative legislatures and executives, like how NC finds itself currently).
And Prop 8 is not an invalid counterpoint. CA has a similar dynamic (progressive urban areas with conservative rural areas: https://upload.wikimedia.org/wikipedia/commons/9/9d/US_House...) to what has led to the current situation in NC.
Regardless, HB2 is an embarrassing disgrace that NC has to deal with.
* Get the blessing of the old employer to work at the new company.
* Work around the restrictions (geographic area, industry, list of companies, ...)
* Fight it.
* Ignore it, ensure the new company will too, and hope for the best.
Compare that to this: http://www.cnet.com/news/calif-supreme-court-finds-noncompet...
After looking at the criteria used to compile the list, I can say that RTP still fails to compete in multiple categories. There is still little funding available in the area for people looking to spin up a "tech" startup, especially for series A and later. The region hasn't had many exits recently (at least, that I can recall), hurting the area in the "performance" category. Additionally, this means there aren't many "startup veterans" around to mentor younger business, dinging the RTP in the "startup experience" category.
There is certainly a growing entrepreneurship scene in the area. There are plenty of healthy, bootstrapped SMBs in the area applying tech to novel problems. But these aren't the types of businesses that come up on Hacker News regularly.
Keep in mind it's a strong life & ag science play. At least 3 strong feeder schools. SAS and Red Hat anchoring tech employment, among others.
It's a fine area for tech startups. Funding isn't a problem, Boston is a short flight away.
No one wants to live there. It's not in the same league as NYC, LA, Boston, Seattle etc.
http://www.forbes.com/sites/erincarlyle/2015/01/27/americas-...
This really sums up the difference. A lot of the companies doing tech in NYC are not in the "hot" or "flashy" realm of tech companies. They're not dime a dozen apps or services that are so prominent in SF. A lot of them are in other sectors, and often with business models, so they don't come across as being relevant when they really are.
This is one of the biggest things keeping my wife and I from considering a move out there. Every time I see the stupid amounts of money being thrown at engineers out there I get this itch to move, even if just for a few years. Then I remember this part, and have serious reservations.
I would add that there is too much smug superiority going along with what you describe. It's a minority of people, but a large-enough minority that I really don't want to deal with it.
hmmmm... Cambridge Massachusetts?
Looks like you're correct. "Just outside" is absurd
I'd guess that "just outside of NYC" is a typo for "just outside of Boston" rather than an ignorance of geography.
Sounds good to me. If the Seattle tech sector appreciates the value of experience, maybe I'll still have a job at 50.
I wonder whether it will be sustainable now that finance is, once again, able to recruit the best and brightest who want to work in NYC. Silicon Valley will always have this advantage over NYC...out west, tech is king. In NYC, no matter how successful tech gets, it's always going to be smaller than Wall Street.
Banks are still cutting jobs, and many hedge funds have had a rough patch for the last few years. What finance companies are recruiting the best and brightest?
But there is literally no residential construction in most parts of the Bay Area.
Foremost, it helps to be born incredibly wealthy, or be born into a world where you have connections to incredibly wealthy, powerful people.
Secondly, whether it's the bootstrapping founder or the speculating funder, the person sitting on their mountain of cash and influence has to be unsatisfied with sitting on a mountain of cash. There's many things money can't buy, but there is one difficult--yet attainable--thing you can do with wealth:
Be famous.
In Silicon Valley, those who are merely wealthy-but-not-famous feel envy toward Jobs, Zuckerberg, and all of California's movie and music celebrities. These people are / will be remembered after they're dead. If you die with ten Ferarris in your garage, you're just as non-existent as a blue collar worker who has a couple dozen people show up to his funeral.
In New York, those who are merely wealthy-but-not-famous have spent generations sitting on old wealth, but the '80s are long gone. Stock brokers aren't cool anymore. Goldman Sachs is hovering somewhere between evil and being a joke. Manhattan's wealthy are starting to feel envy toward Silicon Valley's fame, so they're throwing money at their young relatives and friends in Brooklyn. They do this in the hopes that some of that money will stick to something famous, and they'll be a part of something more eternal than their own lives.
Seattle's wealthy tech giants aren't glamorized. Gates is the quintessential nerd who made Microsoft Windows, the eternal punching bag of boring corporate software. Jeff Bezos is strange to say the least, and Amazon, the WalMart of the internet, is a company that somehow manages to be even more culturally boring than Microsoft.
In fact, the concept of using wealth to achieve fame to achieve immortality isn't lost on Bill Gates. He isn't spending the second half of his life trying to buy in at the ground level of the next big American corporation, he's becoming immortal by spreading his name throughout the developing world via the Bill & Melinda Gates Foundation.
So what does this article really mean when it talks about being risk-adverse? Most people don't have the luxury of avoiding risk. If having rent money is an actual concern in your life, the uncertainty of attaining that next round of VC funding pales in comparison. What's more risky than putting your life savings into opening a small shop or restaurant? But since that's not a tech startup, it doesn't count in the rankings, and so the author of the article condemns Seattle as being a city of people who are frozen in fear of failure.
In fact, the article even manages to touch on the right idea, while missing the truth behind the statement:
"Seattle's weak spot is funding."
In other words, the ultra wealthy of Seattle just don't care as much about tech startups. It's not good or bad, it's just a fact.
If you're rich in NYC or Silicon Valley, status means buying into someone else's good idea so that you can claim your role in being a part of the "next big thing." If you're rich in Seattle, status means that you have the best quality of life: Wealth means a beautiful house by the water, a boat, a nice camper van, and enough free time to regularly take it out of the city. Extreme wealth doesn't mean that you get to look over business plans and sit on the board of directors for what you hope is going to be the next Snapchat. It means that you found a charitable organization, host big community events, create crowd-pleasing spectacles, and put your name on them.
This article is one person's feeble attempt to put attention-grabbing spin on a statistical study. The cited study is likely trustworthy and indisputable. The article is pointless fluff and arbitrary value judgements. Everybody already knows where to move if you want to network with wealthy startup investors, we didn't need some fool writing an article about how Seattle "flails".
NYC has Brown, Columbia, Cornell, Dartmouth, Harvard, the University of Pennsylvania, Princeton, and Yale to draw from, and the associated financial support from the world's finance hub.
Seattle has UW and the wealth blast radius of Microsoft.
Seattle is just weird. Not really fair to describe as flailing. It probably shouldn't exist as a major tech center. Amazon and Microsoft growth occurred because of disastrous miscalculations by established businesses. There isn't any magic chemical in the rain water that creates our tech industry. It's the gravitational influence of the growth in a very few companies. Also, it seems like most of the dividends of that growth are going into the creation of a skyline in Bellevue, rather than VC funds. Maybe if we had SF's inability to build, investors would bet bigger on startups.
The answer from ALL 10 developers was: California California California California California California California California California California
It's the nature. The weather here, really summer is great, but otherwise, it sucks. We have had months of just cold, rainy ,lousy weather. Nature? Line up to rent a car.
NYC is so crammed with bodies, it's jut not fun. Try to get on the 6 train at 5 PM. I say no more. If that's "fun" for you, I'm assuming that inserting a pointed stick in your eye is too. (IMHO)
Maybe VR/AR is the tech innovation that's required for finally making this a reality? Virtual office spaces? As dehumanizingly detached from the real world that could be, at least you'd be doing so from the comfort of your own home.
Article tries to analyse why NYC is jumping spots on the top ten US startup cities list (Up to 2nd from 5th) and also what went wrong for seattle.
Article concludes that while its conventional wisdom that successful IPO's and exits help the ecosystem, in the case of NYC the opposite is true.
Failure of big startups like Fab put people back into the ecosystem who then built new companies and helped scale other growing startups. People who were previously at Fab have gone on to build some of NYC’s hottest startups from theSkimm to General Assembly to ClassPass.
Employees from FourSquare and Gilt are now in senior roles at NYC breakouts Buzzfeed, InVision, Betterment, and DigitalOcean.
While in Seattle risk averseness of tech talent, lack of capital compared to SV/NYC and unsupportive investor base are leading to it falling down places.
Original aritcle: 1950 words (10 minute read) Summary: 140 words (less than a minute)
Summary does a good job of covering the main points of the article but there are more issues that the author goes into. Reading reccomended if you are intrigued.
If you'd like such summaries for all articles before you invest your time to read them check out: https://news.ycombinator.com/item?id=11535695
You're the boss, but my personal view is that this is a very legitimate way to promote his Apply HN:
it is a summary from the post (I've always appreciated TL;DR comments);
it is a demo of the product (it does not supplicate for upvotes through any sort of friendship appeal, only invites those from a legitimate audience who liked the demo to support his Apply HN);
From the FAQ: Can I ask people to upvote my submission?
No. Users should vote for a story because it's intellectually interesting, not because someone is promoting it.
Well, this is promotion, but also it is a promotion that ask you to judge if the idea is interesting and upvote if you agree.
At minimum, it is an attempt to influence votes.
If this kind of summary is getting upvotes it is both proof of concept and promotion of the Apply HN. I see no problem with that. What is the problem in trying to influence people to upvote his application? It seems to me that this kind of influence is a feature, not a bug of this kind of application that YC chose to test.
Are you accusing him of breaking a rule or a spirit of a rule? Because your comment reads like that.
To me, this is an unequivocally useful service, and those imaginary internet points are well-earned. Very often a quick summary in the user's own words bubbles up to the top because people find it genuinely useful.
> Can I ask people to upvote my submission?
> No. Users should vote for a story because it's intellectually interesting, not because someone is promoting it.
I added the "at minimum" since it is a bad tactical decision for the OP anyways as it would potentially trigger the voting ring detector.
And no, "genuinely useful" does not morally counteract the impact of the promotion.
Because of that, these summaries are just comment spam.