San Francisco has long reigned as the motherland of technology companies; both established tech giants and new tech companies looking for their big break operate in and around Silicon Valley in the San Francisco Bay Area. While the industry still has a solid base in the West, New York City is proving itself to be the East Coast hub of technology with what is being called "Silicon Alley."
Where is Silicon Alley?
Different areas of New York City in Brooklyn and Manhattan have been referred to as Silicon Alley, and it has now spread to be more of a concept than a specific location. It refers now to the parts of NYC which are becoming communities of tech-based companies, professionals, and engineers.
"In the last five years, technology jobs have risen from 41,000 to over 52,000 – a growth rate of 28.7%"
One of these areas is in Chelsea and the Flatiron District and is the original recipient of the name “Silicon Alley.” Located between the headquarters of tech giants Google and IAC/InterActiveCorp, hundreds of startup tech companies have found their home on Broadway and Fifth Avenue between Union Square and Madison Square Park. The proximity of so many successful and innovative technology companies has made the area a destination for companies looking to break out in the New York City and U.S. market.
Looking at the statistics, you can see that technology truly is one of the fastest growing job sectors in New York’s economy. In the last five years, technology jobs have risen from 41,000 to over 52,000 – a growth rate of 28.7%, according to a report from the Center for an Urban Future. Compared to the flat levels of other industries in the area, it is easy to see that New York City is becoming the tech capital of the East Coast.
The report also explains that over 1,000 startups have opened in the same amount of time- with many of them, such as Tumblr and Mashable, in the area described as Silicon Alley.
Other Tech Hubs: DUMBO and Lower Manhattan
While not in close proximity to the Flatiron District and the areas of Chelsea that originally made up Silicon Alley, DUMBO in Brooklyn has been considered an important part of New York’s tech scene with a number of helpful co-working spaces and incubators, such as those run by e-commerce giant Etsy.
The EtsyLabs in DUMBO not only are the headquarters for the company’s operations, but also give members of the website a place to use donated materials, teach and be taught about crafts and trades, and make connections with others using the Etsy platform.
In addition to Silicon Alley and DUMBO, Lower Manhattan is making efforts to diversify and get involved in the tech scene. As part of Mayor Bloomberg’s five borough economic plan, Lower Manhattan is set to diversify away from solely financial industries. The city is supporting this with tax breaks and numerous other funding opportunities for tech startups looking to operate out of Lower Manhattan.
Benefits of Silicon Alley?
While many of these tech startups are not related to one another, many of them are also direct competitors. One has to ask – what is the benefit of working in such close proximity?
Simply stated, it’s not just the tech companies making Silicon Alley the hub that is has become. Innovative co-working spaces create a great environment for startups which cannot afford their own office space. One such working space is General Assembly.
General Assembly provides leaders of the tech industry a place to meet, work, and educate one other on specific topics changing in the industry. It’s no surprise that their newest headquarters are located at 903 Broadway – right in the center of the Silicon Alley action. The close proximity also makes it easy to for tech industry leaders to meet potential partners, engineers, or new-hires at coffee shops, bars, and restaurants which are near to their offices. Nearby are also some of the best universities in the country equipping engineers, writers, and talented marketers to get engaged in an innovative startup.
When it comes to technology startups, there is no question that there is a real importance in finding funding for any innovative project. Yet another perk of Silicon Alley for technology startups? There are a number of angel investors and venture capitalists in the area. These venture capitalist firms can be the gateway to finding the funding that many tech startups need to achieve success. While being in close proximity to these funds isn’t going to be the only key to getting your name in front of them and eventually finding the necessary funding, the likelihood that you can make the connection with them or network is much higher than if your offices are located elsewhere.
Will Silicon Alley Surpass the Valley?
In reality, it is hard to say. The growth of the industry in NYC is currently faster than on the West Coast. For international startups, there’s no denying that New York offers a more attractive business landscape than its warmer counterpart across the country. The amount and variety of other industries in the area make it easier to find the right partners, the funding, and the clients you will need to succeed. Only time will tell if Silicon Alley will become the new technology headquarters of not only the United States but also the world.