NYC and Silicon Alley will lead the AI boom | Latest Tech News
It’s been 30 years since the creation of the so-called Silicon Alley — the nickname given Flatiron and Union Square where the unique tech scene emerged during the ’90s dot-com boom — and the traders have never been more bullish about NYC’s prospects.
Despite Mayor Zohran Mamdani in City Hall and predictions that distant work would devastate costly coastal hubs, veteran VCs and newcomers alike inform me that New York is poised to dominate the next 30 years in tech.
Much of that is because, New York is better positioned to capitalize on the AI boom than any other metropolis — due to its selection of industries.
Julie Samuels, president and CEO of Tech:NYC said, “The tech sector is incredibly well positioned because every industry that thrives in NYC needs tech to take it to the next level — fashion, life sciences, finance, healthcare, biotechnology, media, entertainment.” Emmy Park
“Every company is a tech company,” Julie Samuels, president and CEO of Tech:NYC, told me. “Every industry that thrives in NYC needs tech to take it to the next level — fashion, life sciences, finance, healthcare, biotechnology, media, entertainment.”
John Borthwick, founder of Betaworks, a enterprise fund that has backed firms like Tumblr and Giphy, sees AI as New York’s next big alternative.
“AI makes it so cheap and easy for anyone to be an entrepreneur,” he said. “New York can lead here.”
Bradley Tusk who runs Tusk Strategies said, “the main job is still just letting New York be a place where people want to be.” Sportsfile via Getty Images
OpenAI CEO Sam Altman has said that, in the future, somebody can construct a billion-dollar company single-handedly. That dynamic, Kevin Ryan believes, performs instantly to New York’s benefit.
“We’re uniquely able to succeed because we have smart people,” Ryan, who has been called the godfather of NYC tech for co-founding MongoDB, Gilt Group and Zola, told me. “All you need is a computer and smart people … and now there are all kinds of big firms (like Thrive) that can compete with Silicon Valley’s established players and fund these ideas.”
It’s a exceptional reversal for a metropolis that appeared poised to lose a significant slice of its workforce during the pandemic, significantly as distant work took maintain. Instead, New York is now outpacing would-be rivals like Miami.
Last quarter, New York pulled in 10 instances the enterprise capital funding of Miami, Ryan famous.
Ben Lerer tells me many startups he invests in are now trying to lease longterm workplace space in the metropolis. Penske Media via Getty Images
The shift reveals how major Silicon Valley companies have dedicated to the metropolis. “Fifteen years ago a16z didn’t invest [in New York] and now they have 100 people here… every big firm has to be here,” Ryan told me.
Other supposed hotspots are also cooling, he notes. “Apartment prices are down 20% in Austin but they’re up here,” Ryan enthused. “What does that tell you? People want to be here.” Since 2022, the average price of rent in Austin has fallen 17.1%
VCs are clear that the Bay Area and Los Angeles aren’t instantly comparable to NYC, since their huge geography permits them to dominate sectors like vitality and protection tech that require bodily infrastructure. New York’s edge, they argue, is in the density of industries that intersect with technology.
Some VCs dismiss Zohran Mamdani’s presence at Gracie Mansion, saying it will have no influence on the metropolis but others fear it might deter innovation. Erik Pendzich/Shutterstock
But the optimism comes with a caveat: Whether Mayor Zohran Mamdani’s progressive politics will chill the ecosystem stays an open query — one with doubtlessly trillion-dollar stakes, if California’s proposed wealth tax and the ensuing exodus of founders is any indication.
Bradley Tusk, an early Uber investor and political strategist, argues that what determines whether or not expertise stays or finally takes distant work significantly isn’t tax coverage or housing regulation, but high quality of life.
This story is an element of NYNext, an indispensable insider insight into the innovations, moonshots and political chess strikes that matter most to NYC’s energy gamers (and those who aspire to be).
“Making the city a place where people want to be will mean saying no to the orthodoxy of the far left which holds that you can’t enforce quality of life crimes or hold people accountable for their actions because it is somehow racist,” he says. “If Mamdani kowtows to that ideology, we’re in trouble. If he holds firm on public safety, we should be okay.”
From a metropolis management perspective, Tusk added, “the main job is still just letting New York be a place where people want to be. If you do that and you make the effort to ensure these industries feel welcome, the rest will take care of itself.”
Some traders, like Ben Lerer, managing accomplice at Lerer Hippeau, dismiss the concern totally. He told me, “New York’s New York, and the city’s most serious and talented business people will never leave it behind.”
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