I recently was interviewed on Bloomberg TV to talk about the NY Technology Start-Up Ecosystem. The interview can be seen here. The quick summary points of the interview are as follows:
1. While the media/press like to compare NY to Silicon Valley in terms of technology venture capital and start-ups, the comparison is probably not appropriate. The Silicon Valley technology ecosystem began decades ago (with major milestones like the HP IPO in 1957, Intel IPO in 1971 and the Apple IPO in 1980), while the NY technology ecosystem is likely only about decade or so old. Even so, NY ranked second only to Silicon Valley in terms of total technology venture funding and private company M&A among all major cities in the US in 2012. Clearly, NY has enormous momentum.
2. The NY technology start-up ecosystem is developing very favorably with many successful financial exits in the past few years (e.g. Buddy Media, OMGPop, Tumblr, MakerBot, etc.). NY has made tremendous strides in the past decade to be viewed as a place for talented entrepreneurs, engineers, venture capitalists and academics to work. The positive impact of Mayor Bloomberg over this period has played a key role to the development of the NY Technology community and I hope the next mayor can continue the momentum. We are also seeing homegrown venture capital firms like Union Square Ventures, FF Venture Capital, Bowery Capital etc. be an integral part of the technology community in NY.
3. A key part of the development of the NY Technology ecosystem in addition to government policy and homegrown VCs is the support of local universities for technology entrepreneurship. We have seen increased awareness and actions by major universities locally like the entrepreneurship efforts of Columbia University and the development of the Cornell Technology campus at Roosevelt Island. A key part of the development of Silicon Valley over the past several decades was the pro-active efforts of Stanford University to foster and promote entrepreneurship among its students and professors. NY universities like Columbia have dramatically improved their efforts and policies towards entrepreneurship in the past several years and have implemented best practices policies towards entrepreneurship.
4. While NY is now number two behind Silicon Valley in technology venture investing, longer term it will likely be important for NY to have its own natural consolidators that are created and grew in NY. Shutterstock, which went public in 2012, is an example of a successful IPO of a NY technology company. Over the next decade, it will likely be better for the development of the NY technology ecosystem if other companies IPO and grow as public companies rather than NY being mostly a satellite city for traditional larger technology companies (e.g. the acquisition of NY based Tumblr by Silicon Valley based Yahoo). While having Google, Microsoft, Yahoo, Twitter etc. open up offices in NY and seeing NY technology start-ups be acquired at healthy valuations by non-NY technology companies is great for now, longer term, I believe the broader success of NY as a technology center would be advanced if the region had its own natural consolidators.