How Tech Became Cool Again

Last week, over cheese sandwiches, Caesar salads and a cauldron of French press coffee, The New York Observer sat down at the Ace Hotel with a cross section of New York’s tech clique to find out how they relaunched the city’s tech scene. There was the classic financier, Dan Allen, principal at Bain Capital; the social media guru, Ben Lerer, founder of Thrillist; the Ivy League wunderkind, Alexa Hirschfeld, CEO of Paperless Post; and the photo-sharing whiz, Jon Oringer, founder of Shutterstock. As Cat Power’s voice drifted through the cavernous hipster hub—itself an emblem of New York’s tech renaissance—we talked about how engineers became cool and why Silicon Alley might be the new Wall Street.

NYO: What’s the new lay of the land here? Is the tech scene in New York more interesting now than it used to be?

Dan: Well, three things have changed. One is that starting a company is cool again. And going to work at a hedge fund or bank is no longer a guaranteed salary for life.

Nor is it cool.

Dan: I don’t know if it’s less cool necessarily, but people who came out of college in the past few years, who in the past may have only thought about going to an investment bank or hedge fund or large organization in New York are thinking about starting businesses. That’s the first thing.

Second is that all the sudden you can hire great tech talent in New York, which you couldn’t do five years ago.

Third is that there is a lot of infrastructure in New York for starting businesses that didn’t exist 10 years ago. So, all of a sudden, it’s not clear why you’d start it anywhere other than New York.

 

How does the sort of vibe and density and energy of New York inform the kind of companies that start up? Yesterday, we were talking about Apple, and how Apple could never live in New York City because of the kind of company they are and kind of aesthetic it is. Then there are companies that couldn’t live anywhere else, like The New Yorker. How does that translate to the kind of company that would start here, that can only be here? Could your company have really thrived anywhere else?

Alexa: That’s a good question. Companies come out of cities and people with a certain perspective. We were East Coast people with an East Coast perspective.

Does New York breed a certain type of company?

Alexa: There is a stereotype that things are more design-focused in New York, but I don’t know. Just because of the advertising agencies and the fact that it’s not specifically engineering focused.

Are there any talent or technical bottlenecks in New York that are a problem to you?

Jon: It’s hard to find programmers here. We actually don’t do any outsourcing; we have all the programmers in our office. It’s not easy to find them here, and often we have to seek them out and bring them in.

[Ben walks in.]

We’re just talking about starting companies in New York, and if there are any bottlenecks here?

Ben: I guess I grew up here, so it’s sort of tough for me to have a lot of perspective because everything I know is New York. But, there’s absolutely a bottleneck. I think it’s hard to find good people particularly, as the economy has gotten better and things have picked up. There’s so much competition for the best guys.

But wouldn’t that be the case if you were in San Francisco?

Ben: I guess it’s probably the case in any market where there are a bunch of companies growing really quickly all in a similar space.

Why go to Silicon Valley if New York is such a great place?

Jon: Because it’s cold outside.

Is it lonelier to start a company here than in San Francisco, because there’s a larger population of start-ups out there?

Alexa: I think initially when you’re starting out it is because no one knows what you’re trying to do and you don’t have that many examples of people who have done this before. The thing I have noticed from people who are in Silicon Valley is that they are all speaking the same language and have the same buzzwords. Here it’s a little more challenging.

 

Where do you see the tech business fitting in that galaxy of industries that make up New York? Do you still feel like another planet?

Ben: Here the community is quick to accept new people. When anyone starts anything that’s remotely interesting, it’s just seen as more, more, more. Come on in! It’s not a very hard world to break into because people just want more contacts and more friends in this little space.

 

Do you all care either way whether the rest of the media catches on to what you’re doing?

Dan: Jon’s an example of one of the most successful businesses started in New York in the past five years. There haven’t been many great articles about it.

Jon: We’ve kept a low profile on purpose.

 

Why?

Jon: We didn’t really need any press to be successful. It’s nice always to get validation, but we’re doing fine.

 

How much interest do you have in being a business celebrity?

Jon: I don’t really care that much.

Ben: The overwhelming majority of the top entrepreneurs in New York are low key and don’t seek out press. On the flip side, their businesses would benefit greatly from the publicity that comes with a New York Times article.

 

Tell me a company other than your own that you’re really focused on.

Dan: Paperless Post.

Alexa: Venmo is really cool. Text your friends money.

Ben: Andrew Cortina. He was at OMG Pop when it was Iminlikewithyou. Now he started his own thing, and he’s much more technical than a lot of the people. He’s young and hungry.

Dan: Jon Caplan started a business called OpenSky Project. He ran Ford Models before that.

Alexa: An obvious one is Gilt Groupe. It’s an awesome technology team.

Dan: Rent the Runway is doing extraordinarily well; that launched two months ago. Oyster, which is hotel travel site, but we’re investors in it.

 

What about the IPO question? Who’s going to be the first? Gilt, foursquare?

Ben: Foursquare has zero dollars of revenue. It’s a good model.