How New York can TRANSFORM an entrepreneur

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Before you guys jump at me, I'm not saying there's no venture capital in NYC. There are veteran companies such as Blackstone Groupe and Compound that have existed for years, and they've moved plenty of dough.

The only thing is that it's nowhere near the amount of money the West Coast moved. More specifically, the central business place is the Bay Area.

There are many top tens out there, listing the most crucial venture capital firms in the US. Read them, and you will find that a good 70% to 80% of those are from the West Coast.

These firms move big bucks. Companies such as veteran Bessemer Venture Partners had around $5 billion in 2021. Speaking of tradition, this company has existed since 1911, taking up Venture Capital in 1975.

Another legendary VC firm is Andresseen Horowitz, which came to life in 2009. Also known as a16z, this firm has over $16 billion in assets.

We can't deny it: VC loves California.

The reasons why are plenty. We could say that the state has a great culture for creativity, with heaps of talent. Plus, the state has the ideal infrastructure and funding for growth.

But, one of the most significant factors is tradition, and even this is controversial. After all, the fathers of Venture Capital come from Boston, according to some. It's just that Silicon Valley is so important in many ways that people just gravitate towards it.

Silicon Valley became the obvious choice with the boom in technology companies in California during the seventies and eighties. Many of these companies gave terrific returns.

So, this, in turn, meant that the first Venture Capital firms started out in California, as far back as the seventies, to take advantage of this boom.

Tradition is hard to break. After all, why leave if all the money is there? Well, because it's not like California is perfect. First of all, it's expensive as hell to live there. Rent increases, and then, its taxes are amongst the highest in the country.

Even Silicon Valley has taken flack, with more and more reports on its toxic work culture. But, none of these things are absent in New York. After all, it's also expensive and hectic. So, what gives?

And the numbers show that the interest has had an effect. By September 2021, start-ups in New York City had seen investments of $39 billion. This number shatters the previous record by 154%.

When it comes to unicorns, this year, NYC reached 56. In fact, 2021 has been a year of changing momentum. Crunchbase data shows that the dollar amounts led by New York-based investors are close to equal that of California.
https://news.crunchbase.com/news/silicon-valley-new-york-top-venture-startup-investors/


Combining New York and California, they make up for 54% of the venture dollar volume in the entire country. Not only that, but some New York-based companies have seen the highest IPOs in recent years.

(Images of Peloton and Compass).

Tiger Global Management is New York-based, and it has grown 289% compared to 2020 and led the deal counts by September 2021. The second place was Insight Partners, and they're from New York as well.

So, it's clear NYC is wheeling and dealing, but why? Why this migration?

Why is VC choosing NYC?

So, some essential factors make New York a good spot for VCs. Of course, you can mention diversity, talent, and location. After all, it's a stone's throw away from Europe.

Then, there's the social aspect of it. You can find anything and everything in New York. Walk a block, and you'll find something new. People from all walks of life fuel this diversity and break the norm from the traditionally tech-focused society in California.

For people living along the East Coast, moving to New York might make more sense than crossing the entire country to California.

But, these are small reasons that might sway some people, but not entire companies.

A bit of history helps understand why VC is choosing NY. Let's go back in time for a little bit, specifically the 2008 recession. New York was hit particularly hard and was trying to recover. A small group of analysts in the Bloomberg administration decided to take action.

They tried to answer why people loved Silicon Valley and other start-up hotspots and replicate it in the city. As they were known, the Game Changers concluded that the perfect complement to the strong presence of finance, media, and consulting companies there would be computer engineering.

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0:00 Crowdfunding - Intro
0:42 Crowdfunding- Reward-Based
4:14 Crowdfunding - Equity
5:45 Crowdfunding - Equity crowdfunding problems
6:55 Crowdfunding - Equity crowdfunding and new solutions
8:30 Crowdfunding - Examples


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