Why NYC Beats Silicon Valley for Mobile

Foursquare, Medialets, and GroupMe. What do they have in common besides being some of the biggest names in mobile? They’re all located in New York and wouldn’t be the same companies if they had started elsewhere. It’s no mistake then that BMW chose New York as the home of its new $100 million tech incubator.
Silicon Valley continues to look down at New York, rightly pointing out that the real work on building large-scale tech platforms takes place far from Manhattan. But as the plumbing gets set, there is an argument that the next wave of innovation is in web services that build on top of platforms will require the kind of creativity and media savvy that’s made New York famous.
Take Foursquare. The hot location app didn’t start in the barren suburban wastelands of Silicon Valley, but in the vibrant streets of Greenwich Village. It was a way for co-founders Dennis Crowley and Naveen Selvadurai to make sense of their urban social life.
“[New York] feels like that ecosystem results in products that are driven by user needs and available technology in tandem rather than leading with the latter while searching for the former,” said Alex Rainert, head of product at Foursquare, a location based social check-in app. It’s a point echoed by Jared Hecht, co-founder of group-messaging service GroupMe.
“GroupMe solved a real problem we had and experienced everyday in New York,” he said. “It’s very much a product of where and how we live.”
New York is also home to a diverse population and many use cases that simply don’t exist in car-happy Silicon Valley. Mobile is increasingly driven by social, and the city is the best test bed. “A place like New York will help you get to see the outcome of network effects really quickly, making it easier to learn and iterate,” said Rainert.
“This is a consumer city,” said Hecht. “We’ve got fashion, culture, advertising…everything is here. It’s the only place you can take advantage of such a vibrant, diverse and active population.”
Then there’s the fact that New York is the home to media. Tech innovation still mostly occurs elsewhere — Silicon Alley is a bit player to its big brother in California — but the money, in the forms of media companies and ad agencies, is still in New York.
“We started in New York City because this is a media-centric business and New York is the global hub of the world’s media,” said Eric Litman, CEO of Medialets, a rich media mobile advertising platform. “The proximity to the media industry and the direct access to most of the big ad agencies are high on the list of why mobile startups should choose NYC.”
New York is easily the world capital of creativity, drawing some of the greatest minds together to explore new ideas and solve the problems that sit on top of the pipe-work built by Silicon Valley. The environment and the people make it a perfect place for the creative types to set up shop. How long do you think that crowd would last in Burlingame?
The final factor giving New York a leg up in mobile is the same that’s drawn writers and artists to it for decades. New York has an energy and drive unlike anywhere in the world.
“The No. 1 thing that makes this a particularly great environment for a mobile startup is that nowhere in the world has the same competitive drive and work ethic that New York has,” said Litman.
There is a downside, the mirror of Silicon Valley’s penchant to build services that seem geared more to Robert Scoble than your typical consumer. “It’s easy to get seduced by the unique audience and layout you get in a place like New York,” said Rainert. “If you’re looking to expand beyond dense, urban environments you need to ensure that you’re always vetting your ideas and testing your product in places that offer a varied landscape of users and behaviors.”



Digiday Top Stories