Crains New York - February 11, 2013 - (Page 26)

A laptop and a dream Continued from Page 25 London and Sydney. Much has been written about tech companies moving to New York from Silicon Valley—a phenomenon that was almost unheard of a few years ago. But as Silicon Alley has raised its profile, with ample encouragement from Mayor Michael Bloomberg, the city has become a magnet for young people around the globe looking to launch startups and make their fortunes in tech. Employment in the sector grew by 30% between 2006 and 2011, to 120,000 jobs,according to the city’s Economic Development Corp. Overall private-sector employment increased by just 4% during that period. The NY Tech Meetup,the community’s premier networking and advocacy organization, added 12,000 members last year—the biggest one-year jump since its founding in 2004—for a total of 30,000. Of the nearly 500 tech companies on the group’s “Made in NYC” list, more than 50% are actively hiring. “There’s an abundance of people who see the tech community as a place where they can learn and grow—not climb the corporate ladder, but build the corporate ladder underneath them,” said Wiley Cerilli, who founded smallbusiness digital listings firm SinglePlatform in 2010 and sold it to online marketing company Constant Contact last year. Witness to trends Now the general manager of the SinglePlatform division, Mr. Cerilli is somewhat of an expert on the city’s trends. In 1999, at the age of 19, he got off a bus from Providence, R.I., and within a year found his way to Seamless Web, where he became the sixth employee at the online food-delivery service. He would see the dot-com bubble burst, and a new scene emerge with the growth of tech blogs and locally based investors and the launch of cool companies like Foursquare and Warby Parker. “Five years ago, [tech] wasn’t sexy,” Mr. Cerilli recalled. “Now people are coming to New York who want to be part of the community, and we can build a team of great people much faster.” More than just employment opportunities are drawing the new ar- Employment in the sector grew 30% over five years rivals. They’re coming for the same things that have attracted aspiring musicians and writers to the city since the days when the arts, not apps, got young people fired up— the excitement, diversity and culture. New York has also benefited as technology has become less about Internet infrastructure and more about applications. Such traditional local industries as fashion, finance, advertising and media are increasingly part of the digital transition. “As someone involved in sales, I thought being closer to the brands and agencies we’re selling to would be incredibly valuable,” said Lindsey Plocek, a 24-year-old marketing manager at Crowdtap, who spent a year at a San Francisco-area startup before moving to New York last September. “And that’s proved WHERE MINDS MEET buck ennis THE ATTRACTIONS OF NEW YORK for aspiring entrepreneurs extend beyond investors and a welcoming tech community. Incubators and co-working spaces like WeWork Labs and General Assembly are also a big draw. “I’m here almost A USEFUL HANGOUT: two years, and it feels Co-working space like I’m getting some General Assembly sort of entrepreneurial M.B.A.,” said Patti Maciesz, 27, who rents communal space at General Assembly in the Flatiron district, where she works on photo-sharing startup Puppystream. The Bennington College graduate spent three years in Paris trying to start businesses before she and her boyfriend moved to New York and showed up at a General Assembly happy hour in March 2011. She took classes there, hung out, stumbled into a marketing position for startup Craft Coffee, and got to know Puppystream founder Elliott Golden, who sat nearby. He brought her on board as a co-founder last July, and the site, which has gotten seed funding, launched in the fall. “I have a joke with friends of mine who are unemployed,” Ms. Maciesz said. “I tell them to come and stand around at General Assembly for five —MATTHEW FLAMM minutes.” 26 | Crain’s New York Business | February 11, 2013 to be correct.” The salaries aren’t bad either. Nontechnical staffers can start at around $50,000. That’s about half what engineers command, but after three years the salaries climb above $90,000, according to one employer. One thing hasn’t changed: New York is not for the faint of heart. It took Ms. Plocek three months to find an affordable apartment. And that’s nothing compared to getting a startup funded. Not so easy “If you come out of Stanford or you’re an engineer yourself, it could be easier, but for the majority of people that’s not how it is,” said Eric Matzner, 25, who moved to New York from Miami in late 2011 after considering San Francisco as a base for his mobile marketing startup NatMobi. Before investors will put money into a company, he explained, they want to see a product, a team and traction for the business—all hard to come by without investment.Mr. Matzner has been supporting NatMobi by doing consulting work on the side, and after a year of working seven-day weeks he is finally attracting investor interest, he says. Landing investment won’t be getting easier. Venture-capital spending in the metro region in 2012 fell by 18%,compared with the prior year, to $2.3 billion, according to the MoneyTree Report from PwC and the National Venture Capital Association, based on data from Thomson Reuters. The number of deals slipped to 397 from 415. “To get money now, entrepreneurs really have to up their game,” said Brian Cohen, chairman of New York Angels and the first investor in image-sharing juggernaut Pinterest. He added, however, that there are alternatives for startups, like crowdfunding sites, and good businesses will always get money. Furthermore, technology has made it easier and cheaper to start companies—one reason so many seedfunded firms are competing for Series A rounds. For now at least, New York is hopping. Facebook, Google and Twitter have been adding to their offices here. The much-awaited Cornell NYC Tech graduate school just welcomed its first class to its temporary quarters at Google’s Chelsea building. And while engineers may be the most coveted job applicants, new arrivals with other qualifications are finding a lot of open doors. Drew Howard graduated from the University of San Diego last May with a bachelor’s degree in international relations and moved to New York in September. By October, the 23-year-old was working as a strategist at SoHo-based mobile developer Fueled. “I was in New York for about three weeks and had three job offers,” he said. “This is definitely an interesting time.” Ⅲ SOURCE LUNCH: CORBETT PRICE by Barbara Benson Exec wants for-profit hospitals to enter NY I nterfaith Medical Center last Interfaith is one of three New York week signed a memorandum hospitals in bankruptcy. You are a of understanding to hammer restructuring expert, so why is out the details of a takeover by bankruptcy the way to go? the Brooklyn Hospital Cen- Bankruptcy has been an instrument ter. The community hospital serves in the broader business community central Brooklyn and derives 65% of for years but is more recent in its revenue from Medicaid, the gov- health care. It is a way to restructure ernment program for low-income debt, realign an organization and and disabled people. The hospital come out better financially. It’s not filed for bankruptcy in December.Its the end of the world to do a chapter filing. fate is uncertain. Since 1991, a for-profit management group, Kurron Shares of Why is it politically sensitive when New America, has run the hospital. On York hospitals go bankrupt? Feb. 5, Interfaith nurses in the New I don’t know if I agree with that. York State Nurses Association union Bankruptcy is something you do need rallied in Bed-Stuy to save the facil- to do to go forward, strictly a business ity. Their press release read, “Evi- restructuring. In health care, you are dence indicates that the hospital’s fi- taking care of people, and there is an nancial downturn is the result of economic factor, so certainly it draws financial mismanagement by Kurron more attention. A successful bankShares of America, a private firm ruptcy means you emerge able to imhired to manage the hospital. Nurs- prove health care in the community. But you have to be willing es are calling on [Gov. Anto make necessary changes drew] Cuomo to hold the in the process and may not culprits accountable, and stay in the current form. maintain IMC as a fullYou may have to modify the service hospital.” mission statement. There Corbett Price is KurFABIO PICCOLO are shared sacrifices for the ron’s chairman, chief execFIORE 230 E. 44th St. common good. utive and sole shareholder. (212) 922-0581 A minister’s son, he has www.fabiopiccolo Will there be job cuts? shepherded Interfaith fiore.com I’m not sure there will be. I through the bankruptcy’s AMBIENCE: can’t speak for the acquirearly days as its chief reClassic northern ing party. structuring officer. If Inand southern terfaith merges with Italian cuisine in a setting where The local Brooklyn community Brooklyn Hospital, Kurreplica Florentine and workers are holding ron’s contract—and Mr. artwork lends a rallies to keep Interfaith open, Price’s long history with warm tone to the but isn’t the hospital’s fate the central Brooklyn comdecor. Chef Fabio Hakill drops by already sealed? munity—will end. the table to make I’m not an elected official or sure guests are What does the document just government person, so I happy. signed between Interfaith can’t respond to that. But WHAT THEY ATE: and Brooklyn hospitals mean speaking as a former acⅢ House salad; to Interfaith’s future? tivist, people can have an tilapia with olives, capers, tomato The deal is the right thing impact. and wine; iced to do, given the changes in tea You once worked at HCA, the health care. The state has Ⅲ Mushroom for-profit hospital chain. What taken the approach to prisoup; baked wild should New York do to improve oritize resources through salmon with white hospitals’ access to capital? lower reimbursement. wine, lemon and New York should allow Especially in [lowercapers; tea investor-owned compaincome] communities, TAB: $71.15, nies to come in. Access to when you cut to the core including tip capital continues to be a over 10 years, you create chaos. Combining the two hospitals problem. At some point, you have to will allow more cost-effective deliv- have the for-profits come in. New ery of health care and let Interfaith York needs to look at how other parts participate in higher rates with of the country operate. We are havmanaged-care plans. There are ing a disproportionate number of many good reasons for coming hospital failures lately, and we seem to be capital-starved. Ⅲ together. WHERE THEY DINED INSIDE TIP: The $20 prix fixe lunch, with extra charges for specials, comes with an appetizer, entrée and tea or coffee. http://www.fabiopiccolofiore.com http://www.fabiopiccolofiore.com

Table of Contents for the Digital Edition of Crains New York - February 11, 2013

IN THE BOROUGHS
IN THE MARKETS
THE INSIDER
BUSINESS PEOPLE
CORPORATE LADDER
OPINION
GREG DAVID
REPORT: SMALL BUSINESS
THE LIST
CLASSIFIEDS
DIGITAL NY
FOR THE RECORD
NEW YORK, NEW YORK
SOURCE LUNCH
OUT AND ABOUT
SNAPS

Crains New York - February 11, 2013