For many years, the City of New York represented the US and global financial center, whereas Silicon Valley represented the heart and soul of innovation and entrepreneurship. This is why New York was always an Israeli high-tech companies’ focus when they were going public on NASDAQ or NYSE, but when focusing on building start-up companies, most Israeli entrepreneurs still continued to fly out west to set up headquarters in the Valley.
But today, Israeli high-tech firms are more often choosing New York over Silicon Valley when deciding where to set up shop. Why? First, in the new “Digital consumer-age” in which we live, it’s becoming less about the need to manage development of complex technology, which is done in Israel, and more about being closer to your business partners and customers which create the eco-system, allowing you to feel the market “vibes”.
Secondly, the media and advertisement markets are undergoing a fundamental transition to digital, from off-line to on-line, and then everything needs to become mobile. Due to its Eco-system and life style, NY is becoming more attractive to “Ad-tech market” players.
Thanks to these two macroeconomic forces, the City of New York is following in the footsteps of the West Coast-based San Francisco and Silicon Valley, and becoming a hub for technology and entrepreneurship. With already more than 2,000 start-up companies, New York City is changing its nature towards the digital age of technology and innovation. As the city is changing, more Israeli companies prefer it as a destination – after all it is just a “commute distance”, with comfortable flights, and time zone difference is only 7 hours… much more comfortable when you think about flying to Silicon Valley, and 10 hours difference.
Rather interestingly, Israel plays an important role in this major New York transformation. Already more than 10% of the technology companies in NYC are Israeli companies (more than 200 start-ups out of 2,000). See this map by Guy Franklin, an E&Y NY accountant:
And this is just the beginning of Israeli involvement in New York’s tech revolution. The southern part of Roosevelt Island, situated across the river, east of Manhattan, will soon be home to an advanced engineering and technology campus jointly designed and built by a newly created partnership between the Technion Institute of Technology, Israel’s leading engineering school, and the US-based Cornell University. When two academic institutions of that order of importance join forces on one campus, it will undoubtedly have a major impact on the landscape of the City.
Looking back, this “Start-up City” transformation can largely be credited to the outgoing Mayor Michael Bloomberg. As an entrepreneur, he founded “Bloomberg”, a “fin-tech” company which successfully combined the two worlds of Finance and Technology. As Mayor, he brought this vision to life, making NYC both a financial center, and a “Silicon Island”. Moving forward, it will be interesting to see how the City of New York will be changed as a result of the growing US/Israel strategic collaboration as well as the focus on science, technology, academics, and entrepreneurship.