I was recently talking with a NYC VC about the differences between the NYC tech scene and the SF tech scene. He said that he loves NYC but SF has NYC beat and will continue to win. His reasoning behind this resonated with me and so I decided to share it here.
The issue isn't funding or access to capital. SF is definitely beating NYC in this area right now. But this gap could be closed with enough time and investors. The issue isn't the mindset. There is a burgeoning group of tech enthusiasts in NYC that are rivaling the best tech ecosystems in the world. The issue isn't that we are biased to uplift Silicon Valley as the future of all things tech. They are great, but can be rivaled. The issue is we don't have any "Gravity Wells". This is the term that was used to describe the phenomenon that NYC is missing.
Think of a gravity well as a massive black hole. Black holes suck in everything and even influence the orbit of planets around it. The massive black holes in Silicon Valley now include Google and Facebook. A former black hole was PayPal. Eventually these black holes create new ecosystems and push the Silicon Valley ecosystem ahead.
PayPal, one of the first gravity wells in the Bay Area, created Angels, VC funds, new startups, talent, and an entire ecosystem from their employees and founders. Each of the early employees went off to create companies like Palantir, Tesla, SpaceX, YouTube, LinkedIn, Yelp, and Yammer. Paypal's gravity pulled in talent from around the world and spewed out talent, money, and other positive externalities for Silicon Valley. NYC doesn't have this yet.
NYC doesn't have a self-proliferating ecosystem that sustains itself with money and talent. We have money and a bit of talent, but not a money/talent generating machine. Maybe NYC will have a gravity well that produces all of these positive externalities one day, but we don't have it yet. Once we do, we will rival SF with our tech ecosystem.