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The Emergence of Tech Startups in New York

+ Alejandra Rangel Smith

Wednesdays´s Conversation on Urbanization between Fred Wilson of Union Square Ventures and Richard Florida, a Global Research Professor at NYU, shed light on the multiple factors influencing New York´s rise to the second-leading hub for tech startups. They talked about a large range of issues, including how the market today has shifted from hardware to software, how NYC has commerce in its blood, how NYC has capitalized on its high quality of life and how software engineers and artists are more similar than we give them credit for.

Why are artists and software engineers so similar? Both are often more defined by the work that they have to show than persona or resume’s full of past accomplishments. If they can show you a piece or product that blows you away then it doesn´t matter whether the creator is 18 or 48, Iranian or Bostonian, covered in tattoos or in Prada, or anything else. The work speaks for itself. Florida and Wilson agreed that this focus on the work was one of the factors that made artists and software engineers more agile, more connected to everyday life, more exciting and more innovative.

Diversity and quality of life were two overarching themes in the conversation. The diversity of NY´s market makes it an interesting place to explore every imaginable intersection. Etsy for example paired arts and crafts and software engineering. The diversity in the real estate makes it easier for startups to find spaces they can afford, spaces that inspire them and spaces that are close to their talented workforce. Jane Jacobs famously said "new ideas require old buildings" and Fred went on to emphasize how techies and artists want loft-style spaces, tall ceilings, an industrial feel, a shabby lobby, an elevator where there’s no rule against bringing your bike. Wilson and Florida also suggested that New York is a great place to open up a company because of its deep pool of talent. Indeed, Wilson suggested that one reason so many startups are locating in Brooklyn rather than Manhattan is proximity to workforce, with many employees preferring to live in Brooklyn’s less expensive and more dynamic neighborhoods.

Finally, on quality of life, safety, good schools, the transportation backbone, public spaces, great buildings, an exhilarating cultural and gastronomical experiences, are,  among other amenities, instrumental in retaining and attracting the talent that startups need.

High quality of life is an outcome of indirect public policy, but an un-answered question remains: how much influence have targeted policies had on tech startups? In other words, was this rise shaped at all from top-down policies or was it all bottom-up momentum? Fred said the Applied Sciences competition that resulted in Cornell´s Technion was “genius because other universities upped their game”.  Additionally, he emphasized that the following administration could help tech startups by giving them regulatory relief. It’s well known that New York is a regulatory nightmare for some, especially peer-to-peer tech companies

The influence of top-down policies vs bottom-up momentum is one of the issues in need of further exploration. I will be working on a team with Florida to explore this issue in a new research project called "The Startup City"; which will involve a collaboration with Endeavor, a global non-profit that works to foster development by supporting high-impact entrepreneurs.

Tile image by Aurelien Guichard.

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