In 2010, Antonio Garcia Martinez, the founder of AdGrok, wrote, “New York will always be a tech backwater, I don’t care what Chris Dixon or Ron Conway or Paul Graham say.”
That prediction obviously turned out pretty wrong, but it did drum up a whole lot of chatter about the right ingredients for building a startup community—about New York vs Boston on the East Coast and whether cities like Austin and Seattle would ever break through. Today, we would add places like Miami and Salt Lake City to that age old debate.
I built a 3,000 person tech networking organization in NYC back in 2006 and was one of the first 100 members of the NY Tech Meetup back in 2005 so I’ve participated in a lot of these conversations.
Standing here today in a city that has had many multi-billion dollar IPOs and has clearly cemented itself as a world class startup city, especially given that we’re still thriving in the pandemic and that reports of our total demise in a Zoom world have been “greatly exaggerated”, I’m happy to share some of what I’ve learned.
First, you have to ask yourself what the desired outcome is. Are you trying to figure out how to build a place that creates venture backed IPOs or are you trying to build something where technical people can feel like they’re in a community?
Those two things aren’t really the same.
Boston has never had any trouble building big companies—but for years people have told me that there’s very little community feel, especially for newcomers and younger professionals starting out. On the other had, I wouldn’t be surprised if Miami winds up with a fantastic community feel and vibe but struggles to produce big companies. Mailchimp looks like it’s going to be a huge exit down in Atlanta, but that might turn out to be a one-off.
Big outcomes don’t have as much to do with a “community” of interrelated people as you might think. An individual standout founder who has the ability to recruit their first ten employees can build something interesting to a point where they’ll have no trouble getting funding, more employees, and customers just about anywhere.
What you want, however, is to increase the chance that such a founder winds up in your locale—that not only is it routine to find such a person, but there’s also a path for well meaning, aspirational folks just starting out their career to grow into that founder through learning, experience and mentorship.
What makes people like that want to live in any particular community? You might be surprised, because I think it has a lot to do with issues no one ever really seems to talk about.
Top founders want to live in a place where employees are serious about working hard. While the Miami party scene may generate a lot of buzz, if everyone you meet wants to be the next big NFT kingpin, you’re going to wonder if you can hire everyone you’ll need and get them rowing in the same direction in critical, but basic areas like marketing, sales, etc.
This is why, in my opinion, Portland has struggled to build bigger companies, even though there are some incredibly talented individuals there. You move to places like Portland to optimize for a certain lifestyle—and that may not include the desire to work for someone else and build something at a particular growth trajectory.
Secondly, everyone should live in a place where people have at least some basic shared values. While Austin and Miami can make all the claims they want about being liberal enclaves in red states, not everyone you work with is going to live within the city proper. Fewer and fewer tech entrepreneurs who obviously believe in science are going to want to be in a place where you have to debate with sitting governors, let alone your neighbors, the obvious value of a mask during a pandemic, or how female reproductive organs work.
The other component you need is “core” industry. There are lots of cities all around the country where big companies have "field offices”—hubs where work gets done, but not where decisions get made and large scale systems actually get built. This is where you’ll find the most experienced, most ambitious, top employees. It can’t just all be from one company either—because only a small fraction of big company employees are ever going to want to work at a startup. If your city is dominated by one big company, you’re going to find a lot of lifers there who don’t necessarily want to move.
Lastly, your city needs to be livable—and that definition is changing. More and more it means access to various forms of transit—not just highways for cars—good walkability, affordable housing, a clean environment, etc. San Francisco is dealing with some very serious livability issues. When teachers and restaurant workers can’t actually afford to live within commuting distance of their jobs and you can’t walk around at night or during the day without being accosted by people on the street with severe mental illness, people are going to choose to build their careers elsewhere.
None of these things, however, directly impact “community feel”.
For that, you need some other elements.
First, you need gathering places—spots in the city in close proximity where groups can gather for multiple uses: group gatherings, individual work, small meetings, etc. A warehouse might be good for throwing a big tech party, but if it’s on the edge of town and is empty every other moment that there isn’t a tech party, then it’s not contributing to that community feel.
You need places worth consuming at—good food, good coffee, and lots of them. Consumption gets people out—even in a pandemic. Places where you eat and drink is where you feel like there is community.
You also need community leaders and many of them. Community isn’t organic. It takes work. It takes care and feeding and a constant effort to map out who’s who and strive to make sure you’re always being inclusive of who needs to be there.
That means both making people comfortable who wouldn’t otherwise feel welcome in the “tech community” and curating for top tier doers and the most successful.
That latter part is where I often find that events focused on diversity go wrong. I’ve seen a ton of events focused on bringing together aspirational folks from underrepresented groups in tech, but if you can’t show up to an event like this and meet someone who just raised their Series A or B, or just hired their 100th employee, then it’s not going to be as valuable an experience as it could be. It’s not enough to come together just because you’re part of a particular demographic group. You show up because you want to build and work and you need certain connections.
On the flip side, Keith Rabois gathering Keith Rabois’ techbro friends for small, private dinners and having very little tolerance or understanding for a diverse group of people trying to break into the community basically wastes his experience and contributes very little to the growth of the community over the long term.
Great startup community folks need to be a bridge between those who have a lot to offer in terms of real, vetted experience and those who are new and aspirational.
They also need to be empathetic—able to put themselves in the shoes of a diverse group of people, most likely because they themselves have a diverse network, and able to figure out what drives people to show up and participate whether they’re a recently IPO’d straight white dude or a non-binary Black person recently graduated from a coding academy.
They also need to understand how community works both online and offline—as not every parent can show up to 6:30PM happy hour, but we all know that online communities work better when people know each other from face to face. You need both.
You also need to establish a culture of sharing and collegiality. It had been written that NYC was built by industries of zero sum games like finance and real estate, and that DNA wouldn’t work in the startup community. What people failed to realize though is that we’re a city of neighbors. New Yorkers help each other out. We love giving tourists directions and everyone’s got a local business they frequent where they know the owner that they’re hawking neighborhood newbies. We live on top of each other here so while we might walk fast and look like we’re yelling at each other all the time, you can’t be here if you hate other people.
Startup founders always need help. Qualified people need to be willing to help—and not just help their friends. That’s why you also need super early stage investors who can lead rounds, being willing to place bets when there isn’t much there there. Angels can’t do it alone.
Early stage VC’s are also aligned around turning over every rock when it comes to finding innovation hubs and being the connectors between them and the rest of the community.
What I would say isn’t as important—for one, government intervention directly into the startup community. Mayors don’t build startup cities. They need to be focused on housing cost, transportation crime, and the kind of zoning that enables a critical mass of interesting local businesses to thrive.
They can’t make a place a “bitcoin city”.
They can have some longer term impacts through educational institutions. The NYC startup community will benefit tremendously in the decades to come not only from Cornell Tech which came out of the Mike Bloomberg mayoral administration, but also universal Pre-K from the deBlasio tenure.
They’re less impactful on a year to year basis.
In 2005, it was a risky bet to join Union Square Ventures and plant my VC career here in NYC.
It wasn’t until I helped Foursquare raise their seed round in 2009 that many outside VCs even took notice of NYC.
It wasn’t until the late twenty teens that exits like Flatiron Health started proving naysayers wrong.
The one thing that is true for any tech community—it takes a long time to build.