4 The TEP Times | Fall 2014 BUSINESS IN NYC
4 The TEP Times | Fall 2014 BUSINESS IN NYC
The Brooklyn Boom: A Community Of Innovation
BY TUCKER REED
We all know the“ garage story” of tech innovation: college dropouts with too much hair and too little grooming, working in the garage of their parents’ houses – where they end up developing the next big thing.
Today’ s entrepreneurs take a different approach. In the Brooklyn Tech Triangle and throughout New York City, tech companies have been instrumental in helping neighborhoods flourish because they are choosing to work in collaborative, creative environments. Not in isolated garages, but in shared work spaces, incubators, and creative office buildings.
Their choice of location rationale seems to be driven by basic economic principles: cheaper rent. But this has led to a density of tech companies, resulting in more interaction from competing and complementary firms, as well as community stakeholders, all of which yield numerous spillover benefits.
Think Meetups in neighborhood bars, increased spending in local stores, and collaboration and resource sharing as in the case of Brooklyn Law School’ s recently launched Center for Urban Business Entrepreneurship( CUBE), which offers free legal services for startups, in return securing priceless real-world experiences for their law students.
In New York City, tech companies are having an outsized impact, and their actions are resonant. In real estate, the tech sector led, at 25 %, the most leasing activity of all sectors in 2012, according to the NYC Economic Development Corporation, a significant increase from 2002, when the tech sector occupied less than 10 % of leasing activity.
The clustering of companies in the Brooklyn Tech Triangle has created a momentous demand for neighborhood amenities – like the opportunity to create a 21-acre park stretching from downtown to the waterfront and increased bus service to serve local residents and workers.
More importantly, tech fosters innovation and builds ecosystems – manifested both physically and socially – which have reshaped how we attract quality jobs in the city. Upwards of 500 tech and creative companies have displayed an intrinsic ability to thrive in diverse environments, like the industrial Brooklyn Navy Yard, the neighborhood incubator that is DUMBO, and the 17 million square feet of traditional office space in Downtown Brooklyn.
This adaptability is perhaps explained by a tech world that is diversifying beyond the bounds of behemoths like Facebook, Google, and Tumblr. Today’ s tech companies are demonstrating fledgling, cross-sector, and collaborative characteristics. The Brooklyn
Tech Triangle is home to a unique mix of innovation firms, from self-funded startups with fewer than five employees to fast-growing firms. And the tech community actively participates in local programming and is drawn to neighborhood-centric events. Some of these events the tech community founded, while others they supported. The latter includes the DUMBO Arts Festival and the World Science Festival’ s Innovation Square in the MetroTech Commons.
To convey the magnitude of the Tech Triangle’ s local effect, we commissioned an economic impact study last year which identified nearly 20,000 workers supported by the innovation economy, with a collective $ 3 billion dollar impact on Brooklyn’ s GDP. Particularly revealing was the projected demand by existing companies for space to grow. By 2015, innovation economy employees in the Tech Triangle will more than double and occupy approximately 3.1 million square feet. These numbers only reflect companies already operating in the Tech Triangle, not including prospective companies that may move into the area.
The clustering of companies in the Brooklyn Tech Triangle has created a momentous demand for neighborhood amenities – like the opportunity to create a 21-acre park stretching from downtown to the waterfront and increased bus service to serve local residents and workers. For instance, as a clean tech innovation demo, local startup BioLite worked with the DUMBO Improvement District to launch DUMBO Firepit, a contained outdoor fireplace that doubles as a phone-charging station and lighting source for the neighborhood’ s Christmas tree. Equally important are assets such as the Urban Future Lab, NYU-Poly’ s clean tech incubator, which will house startups and showcase groundbreaking technology – or the NYU Center for Urban Science and Progress( CUSP), which will be the leading institution in the emerging field of urban informatics. CUSP draws on data to strengthen and improve quality of life in the urban environment.
Such public works do not just privilege a handful of tech companies. Rather, they provide far-reaching benefits to all who live, work, and visit the Brooklyn Tech Triangle. In Downtown Brooklyn, we are welcoming them with open arms.
Tucker Reed is the President of the Downtown Brooklyn Partnership, one of the lead organizations behind the Brooklyn Tech Triangle initiative.
Overcoming the Three Big Challenges of Starting in NYC
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BY STEFANIE LEMCKE
Making it in New York City is a challenge. Regardless of whether you are from Berlin, Barcelona, or Boston, New York City treats everybody equally and businesses are expected“ to figure it out” without much hand holding. New York International, consultant partner to the New York City Economic Development Corporation’ s World to NYC program( www. worldtonyc. com) and other international development programs, has put together a list of what companies regard as the three big challenges of doing business in New York and how to overcome them.
• Trust: Any company coming to New York needs support. There are numerous professional services available, most of them are valuable for newcomers though never cheap, but finding trusted partners and people in your industry remains challenging.
• Cost: The combination of high costs and competition with low margins will remain a key consideration for many businesses
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. Technology often has a different approach. Even without any profit, New York City’ s focus on valuation can make the city highly attractive.
• Network filter: New York City is home for some of the best people in various industries and fields. Talking to those industry leaders, can help your business immensely, you need to get their attention with a“ qualified introduction” which can take a lot of time.
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The various programs run by the City of New York, the accelerator programs and the dozens of co-working spaces has made the start in New York much easier in recent years. What does the playbook for New York City look like? It has three simple components:
• Coming to NYC starts at home: A company like Klara. com( page 11) saw a demand for their product in the US before moving to New York. Even if that is is not the case, online research into the market, investors, and partners is easier done at home.
• Never walk alone: A company like KISI. com( page 6) won three startup challenges in one week- even New Yorkers took note of that. With the support of leading institutions KISI became part of the NYC tech ecosystem fast and always had somebody to turn to for advice.
• Never be dull, and“ ABC”: Business in New York starts on playgrounds, at birthday parties, and in bars. A company like Etsy. com got one of their first investments after their co-founder was drinking with someone in a bar, pitched his idea, and closed the
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deal(“ ABC – always be closing”). By now, Etsy is generating more than a billion dollars in revenues and supports thousands of local and international entrepreneurs selling their products on their platform.
One of the most successful international entrepreneurs of all time in New York City might have been the young Auguste Bartholdi from Colmar, France. He pitched and tweaked his idea, so everybody in New York found something interesting in it. After 15 years his vision came alive: The Statue of Liberty.
We at New York International, proud partner and organizer of the 2014 TEP conference, are dedicated to helping others " make it in New York." With our website, newsletter, conference series, business development advice for entrepreneurs and our corporate programs we’ ve become part of the thriving New York ecosystem. It has never been easier or more fun to come to the Big Apple.
Stefanie Lemcke is a principal at Quantum Media and co-founder of New York International
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