FAREWELL, SILICON VALLEY Tech start-ups are gaining a media edge by moving to New York.
Posted on 05/28/2012 6:34:55 AM PDT by SeekAndFind
When Doug Imbruce wanted to start an interactive video company in 2009, he had no luck finding investors in New York. So he moved to Silicon Valley — where venture capitalists were receptive to his pitch — and founded Qwiki.
But in February, he decided that being so far away from the nation’s big media companies was stifling his start-up’s growth. So he moved back to New York, bringing the company with him. Qwiki, with 15 employees, now operates out of a SoHo loft space.
“We went to Silicon Valley because they understood how big we wanted to get,” Mr. Imbruce said, “and we moved back to fulfill that promise.”
The recent burgeoning of New York’s Internet industry has forced some entrepreneurs — who, just a few years ago, might have felt they had little choice but to head west to pursue their dreams — to make a difficult choice. New York is now enough of an attractive alternative that a few West Coast-born start-ups are even packing up and moving east.
Much of this change has to do with the way that the technology industry has shifted toward creating consumer products and applications, rather than building the basic framework of computing and the Internet. Many new start-ups benefit from proximity to the media, advertising and fashion industries, New York’s strengths. And as the city’s industry grows, entrepreneurs say, it is offsetting some of the traditional disadvantages of being outside Silicon Valley.
There is little talk of New York overtaking the Bay Area as the hub of the country’s technology industry. And the concept of New York as a real rival to Silicon Valley can make some Californian eyes start rolling.
(Excerpt) Read more at nytimes.com ...
Plus, if the regulatory burden isn’t high enough in California, New York has the highest taxes in the country.
Exactly my thoughts. Move from one tax center to another. If they had any sense, they’d go to some place like Texas.
Good one. Was thinking same thing. If your business is Internet media, why the need for geographical proximity? Methinks they just like the nightlife.
Tax a little, tax a lot. IMHO, both Kallie and NY are taxalots. Both have high ideological costs, regulatory costs, tax costs and a cost of the soul in my book. Neither for me. If these entrepreneurs want to thrive, go somewhere else. Every entrepreneur can’t be a Google, Facebook (where they have to rip off IPO investors).........somebody has to pay the bills...it seems the big winners have already taken care of not having to have that burden.
Bump!
California kills you with taxes and regs and New York does too.
Why not relocate to a more tax friendly state?
Yeah, because Mississippi is just brimming with Internet successes.
It says Tech start-ups.
They can go anywhere.
Not really, not if you want to grow to any scale—then you need to be where the talent is, which is not generally in low-tax states. That’s why Silicon Valley isn’t in Mississippi.
And if these guys want to schmooze themselves into business relationships with the major media companies, there’s no better place to do that than NYC.
Furthermore, there is no state income tax, no bottle deposits and you can hunt on Sundays.
Smart money (tech included) is on Texas.
“New York Has Increasing Allure (Silicon Valley has a rival)”
If true, this challenges the presumption that these techies are so smart. Trading one over-regulated, tax-everything-in-sight venue for another. One without the balmy weather.
Propaganda has to be a LITTLE believable.
It’s cool to be in NY or CA when your company is a start up losing money every year. When you get the venture capitalists paid off and start to make money you build your manufacturing plant in China and customer support in India.
UHm noh....They .....don’t....
Bingo!
California, for all it taxation burdens, has unique advantages that I cannot foresee any other region except the East Coast replicating, and even then, I have my doubts.
The thing is, California has a wonderful lineup of interconnected high technology universities - Stanford, UCLA, USC, Berkeley, CalTech, etc., between the SF-LA region, all critical to high tech industry success. Combine that with the free California spirit (closely resembling my home country, Australia) where ‘business outfit’ means t-shirts, sandals and shorts, and the above-excellent weather, you have a captive environment where the people (graduates) are willing to pay for the compromise of ridiculously high taxes in order to live in such a professional and cultural climate.
I work with a company that makes advanced machines for the tech industry and they have a critical / urgent requirement for an embedded systems programmer / architect and the guy who will be interviewing candidates for the position is a buddy of mine. The company has centers in California, Texas and Georgia - and this is what he told me with a straight face - he tests candidates by asking them if they are willing to move out of California - and he tells me he won’t hire anyone who makes the mistake of answering in the affirmative because he considers anyone willing to do so to be, in his words, ‘stupid’.
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