NYC Tech

Was watching the video posted on my friend Fred Wilson’s blog today.  It’s interesting for a number of reasons.  There are some broader takeaways that people who aren’t in the NYC tech scene can walk away with.

• This isn’t a competition between cities.  It’s creating a bigger pie.  Tech is not a zero sum game.  NYC got big, but SF/Silicon Valley got even bigger.  NYC is growing faster but had a smaller base so percentage gains look bigger.
• Growth is good and it stands to reason that growth can happen where you have business/creative clusters
• There were no central planners in NYC.  No committees.  No coronated leaders.  People did stuff and acted in their own self interest. The sum of what they did created a very large open community.
• They got Seed money into the ecosystem early.  You can’t build a startup community investing in Series A or B or C.  It has to be Seed.
• There were a lot of larger funds participating.  USV’s first fund in 2004 was $125MM.  There were other larger funds in NYC besides USV investing at Seed.
• No one looked to politicians to do anything.  They joined later in the game.  They were sideshows not in the central ring.
• They were successful with companies that NYC historically has a deep bench in.  Media and ad companies were enormously successful.  That helped build a broader community.
• When the storm of 2001 hit, there were enough fragments of the former community that were strong enough to weather the storm.  NYC also had enough jobs at traditional firms so if you lost your gig at an internet startup you could get a job at another company and survive until the next wave.

If you look at where you live today and the startup ecosystem, does it have these characteristics?  If so, you can replicate NYC.  If not, you will have trouble.