Surprise! The most lucrative neighborhood for getting venture capital deals done is not the tech corridor from DogPatch Labs to the top of Madison Square Park that seems to emanate from Fred Wilson’s office in Union Square. In fact, according to data from the research firm CB Insights, the epicenter is northeast of that, closer to Gilt Groupe’s Park Avenue offices, between 32nd and 33rd Streets. Their zipcode, 10016, happens to be the hottest in the city for securing venture capital.
Maybe it’s a lucky office? Gilt co-founders Alexandra Wilkis Wilson and Alexis Maybank, along with angel investor Doubleclick co-founder Kevin Ryan—and their $270 million in funding—work out of the space formerly home to Right Media, which was successfully sold to Yahoo in 2007.
While SoHo, Union Square and Chelsea are still start-up hubs, CB Insights data shows that a particular stretch from the mid-20s to the 40s on the East Side—covering Kips Bay, Turtle Bay, and Murray Hill—saw 40 VC deals worth a combined $351.8 million since 2009. If you stretch it out to the mid-50s on the East Side, that’s 76 deals amounting to more than $840 million. The numbers were enough to make the New York Post declare that the area they’d like to call Silicon Park (meh?) is giving Silicon Alley a run for its VC money. But is it really?
Like Betabeat, local entrepreneurs were skeptical. General Assembly’s Brad Hargreaves conducted his own unscientific study to see whether it was just a function of Gilt Groupe’s $270 million finger on the scales. But the numbers seemed to pan out. Mr. Hargreaves told the Post:
“What really surprised me was the Murray Hill area. I found that fascinating, so many deals being done on East Side on Park Avenue in the 30s.”
Whether it’s the commercial class A building space that lures them, or the proximity to Grand Central, start-ups like Adkeeper, Xgraph, and Offerpop have found the funding flows more freely further northeast. But don’t pack up your foosball table just yet. Silicon Valley VC Accel Partners, for example, recently opened up an outpost in Chelsea, not far from other notable West side holdouts: NYU and Googleplex East.