I moved to New York City yesterday! I'm very excited to finally get the chance to live in this city — I've always loved NYC, especially because of the art and music scene. I grew up going to experimental punk shows in LA garages, and NYC is one of the few places that can really rival LA in terms of music. But as somebody who works in and writes about tech, I'm also very aware of the tech scenes in different cities and how that affects the experience of working in tech in each of those places.
As somebody who has lived in both LA and the SF Bay Area, I got to see firsthand the pros and cons of each city’s tech scene. At this point, I think I have a good sense of what qualities are important for a city to have a good tech scene. I'm excited to see if NYC holds up compared to LA and SF!
Also, if any readers are in NYC and want to grab a coffee or a beer, shoot me a DM on Twitter @blip_tm!
Cities need many different kinds of tech.
Tech is more than just software. I'm very aware of this as a hardware engineer, but a lot of software people often think of the tech scene as revolving around software. Unfortunately, there's a limit on how interesting products can be if they're just pure software. Some of the most compelling products of our generation — the iPhone, the Tesla, and the Internet itself — were built by diverse teams of software engineers, electrical engineers, mechanical engineers, and all sorts of other experts. For a tech scene to be able to produce products like that, those different kinds of engineers need to come into close enough contact for them to end up at the same company working on the same product.
SF is unique because it crams a ton of different kinds of tech companies into a fairly small area. LA, on the other hand, is a huge sprawl of a city with fewer tech companies overall. As such, you end up with little pockets of tech that are fairly monolithic. Social media in Santa Monica. Defense and aerospace in Hawthorne and El Segundo. Semiconductors in Irvine.
The lack of cross-pollination of ideas and talent has deeper consequences than just cringe-y Gundo bros. Having sufficient diversity makes it easier to hire the teams necessary to build the complex, multi-disciplinary projects that underpin the most exciting companies.
I hope that NYC will be more like SF in this regard. New York is basically the opposite of the suburban sprawl of LA, and the ease of getting around should result in fewer monolithic pockets of a single kind of company. However, it's unclear how many hardware engineers work in NYC in the first place — with rent so high, it's likely much more difficult to afford lab space and build hardware companies at all.
Engineers need enough contact with the outside world.
The Bay Area is the only place I've ever been that has billboards for B2B SaaS products. To call it a tech bubble is maybe an understatement — I've known people who live in the Bay who eat dinner at work every weeknight and who have no friends outside of tech. If you want to lock in and grind on open source software, maybe that's a fine way to live your life. But if you want to build consumer products that are targeting normal people, you need to have enough contact with normal people to understand what they actually want. If you don't, you'll end up building one of the many AI wearables that have been decried as overpriced, barely functional, or straight-up creepy.
This is a good thing about LA — tech doesn’t reign supreme, so you have to spend time with normal people if you want to have any modicum of a social life. This explains why so many consumer app companies are headquartered there. Snapchat and many of its social competitors have offices in Venice or Santa Monica, a nice part of LA right on the beach. On the other hand, sometimes this goes too far — I've been to way to many crypto events in LA where nobody there bothered to even learn how a blockchain worked, because they were busy trying to mint the latest consumer fad as an NFT.
Again, I'd hope that NYC is more like LA in this fashion, simply because NYC is such a huge and diverse city. Though that may mean NYC could have the same weaknesses as LA, with some founders over-correcting on consumer feedback and focusing on going viral rather than on building meaningful, valuable products.
Cities need enough large tech companies.
I love startups. Hell, I work at one! But one of the keys to a thriving tech scene is large employers. If a tech scene is just startups, it's going to be extremely small. But even worse, the few startups that get successful might have to move, because there's no local company to acquire them. Often, when a company gets acquired relatively early (pre-series-B), they'll get absorbed into the larger company, and may have to relocate to wherever their acquirer is based. While some startups will be so successful that they will become the big company in an area, those are few and far between.
Most big cities have enough big tech companies to ensure that startups have exits available. However, the culture of those companies also affects the tech scene. Engineers at the local big companies form the backbone of any successful tech scene, so the kind of engineers those companies attract affects the culture of the tech community in those cities.
The Bay Area is pretty peerless in terms of its number of big tech companies -- you have Google, Facebook, Nvidia, and countless others. Also, all of those companies have cultural values that are at least somewhat conducive to a great tech scene. They're fairly open and relaxed places with a culture of technical excellence -- the sort of places that would publish their work openly or contribute to open source projects.
LA has a lot of large employers working on tech, but they're mostly in defense: you have companies like Lockheed Martin and Raytheon. These companies aren't great acquirers for startups, because the sensitive nature of their work makes it hard to bring new companies and new IP into the fold; this limits the exit opportunities and shrinks the startup scene. At the same time, employees of these big defense contractors are severely limited in their ability to talk about their work, which makes the sort of exciting technical conversations and the exchange of ideas that's key for a good tech scene harder to come by.
NYC might have its own problem here: the finance industry. I personally think of quantitative finance as different from tech; the tech industry is about building products for customers, which finance is about moving money around. But because both jobs use computers, I know many people lump quantitative finance in with the tech sector rather than the finance sector. I'd hope that the tech scene in NYC is focused more on building products than on shuffling money, personally.
Ultimately, tech scenes don't matter.
People worry a lot about social approval. Oftentimes, the goal of being in a "tech scene" is simply to find people who think you and your work is cool. And that's okay! Social connection is a fundamentally human need, and being around people with similar interests is really fun. But I think it's important to note that great companies come from all sorts of places.
Duolingo is worth over $8B and was founded in Pittsburgh. There are already multiple fully remote companies that are unicorns. Where you put your company might affect how happy your employees are, or how plugged in you are to what tech folks think is cool. But ultimately, tech scenes don't matter, and you can build an amazing company anywhere.
Wonderful article. I think from the perspective of a founder, you're spot on in that "tech scenes" don't matter (as Peter Thiel writes in Zero To One, "Positively defined, a startup is the largest group of people you can convince of a plan to build a different future"). Though, I suppose from the reference frame of an angel investor, one would want to be in a Silicon Valley-type cluster, to maximise in-person interactions with interesting founders (Jason Calacanis writes about this in his book). What do you think?