So many things have changed for the worse in New York City since the Covid pandemic took hold that it is worth noting one development for the better: the city’s tech sector has thrived, and continues to do so.
Its rude health is charted in a report published this month by Tech:NYC, a local trade group, and the Center for an Urban Future think-tank. It found that tech accounted for 17 per cent of New York City’s job growth since 2010 (about 114,000 jobs) and was increasing at a faster rate than nearly every other sector.
The ranks of start-ups in categories as diverse as wellness, artificial intelligence and augmented reality have grown more than 50 per cent since 2016. They attracted $55bn in venture capital funding in 2020, about five times the amount in 2015.
Perhaps the statistic that best conveys New York City’s evolution into a full-fledged tech ecosystem concerns Gilt, an online shopping company launched in 2007. Its alumni have since seeded at least 60 more start-ups in New York City. “It’s the one industry that not only didn’t decline but actually grew during [the pandemic],” Jason Myles Clark, Tech:NYC’s new executive director, marvelled.
Tech’s growth here may seem at odds with an episode three years ago when residents, inflamed by tax giveaways, chased Amazon from Long Island City, Queens, where it planned to build a second headquarters.
But it will be apparent to anyone who has followed the city’s commercial real estate market, and the massive New York investments of late by Google and Facebook. It is also evident in the look and feel of new offices that encourage collaboration and flexibility — even whimsy — while eschewing the sense of hierarchy exuded by the city’s banks and corporations.
If current trends persist, there may come a day when the iconic Wall Street bull statue is joined by a bronze app or sculpture of WeWork founder Adam Neumann. Or perhaps not. One thing that is unique about New York City’s tech culture is how it has been tamed and subsumed by the larger metropolis. Tech bros may prosper here, but they are not likely to overrun the place, as they have San Francisco.
“New York has really imposed its character on tech, and not the other way around,” said Clark, himself a native of Jamaica, Queens. In fact, the city’s heft and breadth may account for much of the tech industry’s local success.
Tech flickered in New York during the 1990s dotcom boom. We all know how that went. Its second wave came in the early 2000s. Its growth was both organic and encouraged from above by a mayor, Michael Bloomberg, who was determined to diversify the city’s economy beyond financial services after the September 11 terror attacks.
Under Bloomberg and his economic development chief, Seth Pinsky, New York built an applied science campus on Roosevelt Island, created tech incubators and appointed a chief digital officer, among other efforts. Bloomberg was known to drop by ribbon-cuttings to cheerlead even for tiny start-ups. “It wasn’t any one thing they did but it was the feeling that the Bloomberg administration was all in on tech, I think, that really counted for a lot,” said Jonathan Bowles, of the CUF, who co-authored the report.
The city, Bowles believes, also benefited from the changing nature of technology. Silicon Valley required hardcore engineers to develop semiconductors and hardware that became the backbone of the internet. New York City was never going to compete.
But nowadays, companies prosper by finding ways to apply that technology on smartphones and other platforms. As a capital of media, advertising, finance, fashion and so many other industries, New York City has an abundance of the talent and expertise to do so. It is an ideal place to create prop-tech, fintech, ad-tech and more. “Tech just became those other industries — or they became tech,” is how Bowles explained the alchemy.
Laurel Touby experienced New York’s 1990s internet boom as a journalist and entrepreneur, and is now a Manhattan-based venture capitalist. The city, she believes, is distinct from west coast tech hubs. Its financial roots make it less utopian and more by-the-numbers. “In Silicon Valley, you’re going to run into more dreamers. But here, you’re going to run into the more pragmatic, ‘how can I use tech to solve your business problem?’’’ Touby said, arguing that former investment bankers “would only suspend disbelief for so long”.
As a native Floridian, she was reluctant to endorse the notion that an ascendant tech sector would bend the city’s character. “If anything,” said Touby, “I think the city changes whoever comes here.”
Tech bros prosper in New York, but won't overrun it - Financial Times
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