With the Talent Unleashed Awards underway we thought we’d put together a series of features on start–up cities around the world where we expect to see some great entries. Since I’m currently based in the US we thought our first port of call would be New York which I visited last week.
Richard enjoying the view over Central Park
Big Apple, next Apple ?
According to many venture capitalists the New York start-up ecosystem is now at a stage where two decades of entrepreneurial experience and endeavour is finally bearing fruits. Between 1996 -2006, plenty of internet investment took place but short term thinking prevailed resulting in a lack of traction. Nowadays, these experienced entrepreneurs act as angel investors, role models, mentors and informal advisers to first –time company founders, a process that has been happening in Silicon Valley for the last three to four decades which is generally regarded as one of the key factors of its success.
New York’s start up sector (nick named Silicon Alley) has developed into the second-largest venture market in the U.S. but it’s still small compared with Silicon Valley. Whilst there are around 400 venture capital operators in California, that number compares to only around 100 in New York. Deal size is relative to this and valuations tend to be more realistic perhaps in line with the city’s more discerning nature. Fintech features prominently which is to be expected given the city’s position as a global financial centre.
New York’s iconic Rockefeller Centre
If start-up hubs are a measure of activity then we only have to look at WeWork – the rapidly growing US venture based out of New York that provides co-working space for entrepreneurs and start-ups and already has a valuation of around $16billion. There are 40 WeWork locations in New York with 35 in Manhattan alone – and they’re all full! I dropped into the Bryant Park facility which I often use as a mid-town working venue. If we simply apply the law of probability across such a number of aspiring entrepreneurs then we will surely see some successful outcomes.
Richard visiting WeWork Bryant Park
Some NY quick facts
- 1 in every 38 American lives in NYC
- Snow is definitely not a rarity, the city gets 15 times more snow than the South Pole every year.
- New York might as well be also called the capital of coffee, the coffee consumption here is nearly 7 times higher than in other cities.
- Who would have thought that honking your car horn is illegal in New York City, except for emergencies of course.
- New Yorkers are bitten 10 times more by other people per year than shark bites occur so swimming in Australian waters suddenly appears very safe.
- The operating cost of a hot dog stand around Central Park is close to $300 000 a year.
- 27.8 percent of the US venture capital is clustered around the metropolitan areas of Boston, New York and Washington D.C, which leads to an ideal breeding ground for emerging enterprises.
- In 2016, New York became quiet in terms of IPOs from tech companies, but this should not be regarded as a sign of a stagnating start up scene. 421 tech companies raised $9.5 billion in VC funding as well as 109 exits valued at more than $5 billion shows that NYC well deserves its nickname as ‘ the city that never sleeps’.
- B2B software companies currently enjoying the highest investor confidence, raising an impressive $3.9 billion in funds for 2016.
- Infor a New York City based software company specialised in cloud based business applications, alone has raised $2.5 billion in 2016.
- PwC MoneyTree report suggests, New York is right after San Francisco in terms of deals closed in Q1 2017 with 154.
Look forward to some great entries New York! Sure is a city that never sleeps.