New York’s tech space has been bubbling for some time, with many local officials, executives and investors betting that the city is poised to become the next Silicon Valley. But even as local technology businesses boom and startups connect themselves to the region’s traditional advertising, media and financial industries, that goal remains elusive, notes the New York Times.
For one thing, none of the companies deemed to be breakout stars – like Foursquare, Fab.com and even Tumblr — have lived up to their expectations or attained anything close to the multibillion-dollar valuations found regularly among Valley startups.
But while the hype may be dying down and some investors have started sending cash to tech centers in Canada and Europe, the city still has its boosters.
New York Has Legs
For one thing, New York has overtaken Boston to become the second-most-invested-in tech center, noted Anand Sanwal, chief executive of CB Insights, a data analysis firm that specializes in venture capital trends. He’s confident that the city has legs in early and mid-stage companies and sees the lull as a necessary growing pain for a local market that is still relatively immature.
One challenge the city faces is poaching. The city’s entrepreneurs and investors say the best engineers are grabbed by the New York satellites of Silicon Valley and Bay Area stalwarts like Google, Facebook, Twitter, Dropbox and eBay. That makes it harder to engage top talent in greater numbers beyond the initial team. Another factor is simply location. The biggest IT investors are still in Silicon Valley, and that works in the favor of California’s startup founders.
Silicon Valley Rules but Others Rise
Despite the supposedly dimming buzz, all is hardly lost. There are many New York startups with significant wattage, such as Gilt, BuzzFeed, Kickstarter and MongoDB. And lots more are on the horizon.
Of course, the city faces a lot competition besides Silicon Valley. Boston continues to thrive as a home for tech startups, and centers like Portland, Ore., Nashville, Los Angeles and Austin are growing at a fast pace. The Valley has dominance with the longest pedigree, and by far the most dollars invested, but there’s much happening outside that sphere, as well.
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