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New York City Takes on Silicon Valley

Monday, December 19, 2011

Aerial Rendering of New Cornell University-Technion Applied Sciences Campus on Roosevelt Island. (nycmayorsoffice/flickr)

Mayor Michael Bloomberg announced Monday that Cornell University, with its partner the Technion - Israel Institute of Technology, has been chosen to build a new applied sciences and engineering school on Roosevelt Island.  It is another sign of his administration’s push to promote and expand the city’s growing technology sector.

“It promises to create a beehive of innovation and discovery, attracting and nurturing the kind of technical talent that will spawn new companies, create new jobs and propel our city's economy to new frontiers,” the mayor said.

But even as the city pushes for the new campus, finding and duplicating the exact mix that made Silicon Valley what it is could be challenging. 

“A university by itself is not clear that it will transform New York into a more entrepreneurial dynamic place,” said Anna Lee-Saxenian, dean of the School of Information at the University of California-Berkeley. “So, one single institution can’t be the story of Silicon Valley or of creating a new Silicon Valley.”

The genius of Silicon Valley, she said, is its ability to market new ideas. “It’s about commercializing ideas, trying multiple experiments, new products, new ideas very, very quickly.”

That’s what New York City officials want to duplicate on this coast, aided by the creation of the new campus.

“Our goals for New York are not to be number two. Our goal is to be number one, and today that position is clearly held by Silicon Valley,” said Seth Pinsky, the president of the Economic Development Corporation.  “We think, though, that we have the ability over time to continue to gain on Silicon Valley.”

But it will take more than just an increase in the number of engineers. Warren Lee, a partner with the venture capital firm Canaan Partners, said the city also needs to reach a critical mass of entrepreneurs who have experience creating new companies. 

"It's much easier to build a larger company once you have done it a couple of times," Lee said.

And the size of those start-ups matter.

“It’s a sort of a numbers game,” he said. “Most companies fail. So the more companies that are there trying different things, the higher probability that one of them will become a $2 billion to $3 billion company.”

When a company reaches that level, not only do those at the top make money, but so do employees down at the lower levels: the programmers and the designers, even that guy in the mail room.

With more money available to more people, as well as the experience in creating a company, more individuals are freed up and able to create more companies, thus continuing the cycle and expanding the sector.

And according to those who follow, work in and invest in the tech sector, as important as engineers are to a tech company’s DNA, it involves many different types of employees to be a success.

Take the wildly popular app Angry Birds.  According to Dan Savage, managing partner with Resolute Digital, the most popular smart phones games are only 10 percent code. Savage, whose firm builds mobile apps, said the content and design of these programs can make up the other 90 percent of the product. 

And that’s where New York City excels.

“If you are New York, you don’t want to be Silicon Valley, you want to be New York,” said Om Malik, founder of online tech magazine GigaOm. “You have to be unique.”

Berkeley's Lee-Saxenina said recreating Silicon Valley’s success may not be as simple as building a new university. 

“A university by itself is not clear that it will transform New York into a more entrepreneurial dynamic place,” she said. “After all, we have big famous engineering universities in Texas and California, in Europe, in Germany and England, that don’t have Silicon Valleys around them. So one single institution can’t be the story of Silicon Valley or of creating a new Silicon Valley.”

City leaders are hopeful. They expect the Cornell’s new school to create nearly 600 spin-off companies, employing 60,000 people over the next 30 years.

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Comments [4]

Dan Savage from New York City

To Bill from New Rochelle,

I certainly didn't mean to diminish the importance of engineering to digital projects. In fact, more than two-thirds of our employees (myself included) are software engineers. However, what is unique about New York City is our ability to build teams with great designers, information architects, multimedia producers, creative talent, and software engineers to build innovative new products for our clients.

Dec. 20 2011 03:27 PM
KA from Westchester

Bill is right on many points. People forget NY had to transform itself more than other cities have had to. NYC was once the manufacturing capital of the US. Technology is the new way to go. One thing is right though - NY could never be another Silicon Valley - because as Bill said - it's not as laid back. That said - NYC is full of entrepreneurs and always has been. The metro are has always been full of engineers too.. but they work in different industries (if you look at history many things have been invented here). Now this help focus some of that energy on computer technology.

Dec. 20 2011 11:20 AM
spacemanaki from Brooklyn

Dan Savage's claim that building something like Angry Birds takes 10% or less programming effort and 90% design effort is wildly off base. In the context of this piece, his claim seems to imply that if a company like Rovio (behind Angry Birds) blossoms in NYC it will create jobs for more than just engineers. This isn't that controversial a claim, but I do not believe a ratio of 9 to 1, non-programmers to engineers is at all realistic. Take a look at Rovio's "Careers" page [1] and just compare the number of programming positions to non-programming. It's far closer to a fifty-fifty split. Dismissing the engineering and technical effort involved in starting and running tech companies isn't going to get NYC anywhere.

(I'm a software engineer in NYC and I hope the city succeeds in their goals, because I certainly like living here)

[1] http://www.rovio.com/en/careers/Open-positions

Dec. 20 2011 09:23 AM
Bill from New Rochelle

In my youth, the NYC region was a great manufacturing city. My dad worked in a factory that made coils, transformers, and chokes, electronic devices. Later, he worked in a factory that made selenium plate rectifiers,devices used before diodes were invented.

This proposal would hardly be changing New York, as Mr. Malik believes. He knows little about New York, but he will learn.
Likewise, Dean Anna Lee-Saxenian also just doesn't get it. This will not be "...one single institution..." but, just another part of Greater New York! It is not just "content" or "design;" it is the whole ball of wax. It is the BIG APPLE.

This 'tech oplanting' has been tried already in upstate NY (Gov Pataki,) and the upper Hudson Valley (Gov Cuomo,) where, unfortunately, nobody wants to go. It is true that EVERYBODY wants to come to NYC. Just Watch!

A new universary in NYC will be like a black-eyed susan flower; dropping seeds all around; and believe you me...the boroughs on NY will be far more productive than the fine country club-work facilities at Silicon Valley.

WNYC, time to think of more tech shows, with both software and hardware guys and gals.

Dec. 20 2011 09:09 AM

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