“Facebook’s decision to come to New York and tap into our tremendous wealth of tech talent,” said Mayor Bloomberg at a press conference Friday, announcing the company’s expansion of its New York office, “I think, is conclusive proof that we’re well on our way to achieving our goal, and that is to become the world’s number-one hub for information technology and social media.”
Also present, Senator Chuck Schumer likewise praised Facebook’s Big Apple expansion as evidence that New York is winning a battle for tech supremacy against Silicon Valley.
Near the end of the presser, a reporter tried to see whether Facebook COO Sheryl Sandberg concurred with the mayor’s assessment. Senator Schumer cut her off before she had a chance to answer. “Bloomberg and I think so,” he said.
Ms. Sandberg and the rest of the tech establishment may or may not agree with Mayor Bloomberg and Senator Schumer’s rather optimistic take on New York’s tech scene’s surpassing Silicon Valley, but there’s no question the industry has made great strides in this city and there has been a big political push toward making that happen.
Seth Pinsky, president of the New York Economic Development Corporation, told The Observer that the growth of the city’s tech community is directly attributable to the Bloomberg administration’s efforts to attract business. “In just the last five years, the number of people in the technology sector has grown by nearly 30 percent,” Mr. Pinsky said. “For the vast majority of cases, the reason companies have grown is because this mayor and this city have put into place the conditions that make it in the interest of these businesses to expand here.”
The mayor’s encouragement of tech companies coming to New York has even included a personal touch. In the past few months, he has made personal appearances, including visits to New York Tech Meetup to announce his 10-man advisory council on tech, to Demo Day for the TechStars New York accelerator program, and to the opening of the New York offices of Yelp and Twitter. In addition, he taped a greeting for the fund-raiser Raise Cache, to benefit hackNY, a program to encourage the city’s computer science students toward start-ups and away from Wall Street. On April 16, he appeared at the East Village headquarters of the social media check-in site Foursquare, where he issued an official proclamation announcing “Foursquare Day” in New York City.
“We are proud to join Foursquare’s founders and fans in celebrating the first global social media holiday. Today, April 16th—4/16, the fourth sixteenth of the year—is Foursquare Day in New York City and around the world,” the mayor’s proclamation read.
City Hall’s tech industry push has also included a historic initiative to build a graduate engineering campus in New York City. The idea is not only to replicate Stanford’s role in seeding Silicon Valley culture and spin out the next Google (or Facebook) in New York, but, in the Mayor’s telling, to make New York a global hub for technology and innovation. The highly competitive request for proposal process—which rubbed some native institutions the wrong way—yielded seven bids from an impressive roster of schools including Cornell, Israel’s Technion and even Stanford itself.
At the Facebook announcement, Mayor Bloomberg described his high hopes for the tech campus, which he said he expects “to spin off hundreds of new companies and create some 22,000 jobs in the years to come.”
Behind the scenes, the political efforts have been focused on improving the overall climate rather than on wooing specific companies. For his part, Mr. Pinsky said the EDC has spoken with tech companies, but he and his staff haven’t tried to sell individual companies on making the move eastward with financial incentives or logistical support for specific projects, as other cities have.
“In a lot of cities, the role of an economic development agency is very tactical: let’s get this company to move their office here. It’s great, but it’s a very inefficient way to build an economy,” Mr. Pinsky said. “We have made trips out to Silicon Valley, we’re telling businesses there, we’re telling businesses in Boston about what’s going on in New York and the message is percolating throughout the consciousness of the technology community. … What we’re trying to do is get the message into the collective consciousness of as many people as possible rather than targeting this company or that company.”
City Hall confirmed it didn’t give Facebook any financial incentives to expand the New York office. A source with knowledge of the Bloomberg administration’s tech strategy explained why New York doesn’t feel the need to give companies cash.
“There was no, ‘Hey come here, we’ll give you $100 million.’ Or, ‘Please, please, please Facebook, please come here,’” the source said. “There’s no courting because we don’t see the need, because we know New York is a premium brand. That comes up a lot, New York is a premium brand. We don’t need to sell down. We don’t need to go down market the way other states and cities do. This is like a really, really firm policy.”
Along with Apple and Google, Facebook is one of the top power players in Silicon Valley and the company’s Madison Avenue expansion is the biggest achievement to date in the city’s push to become the world’s high-tech hub.
“We’ve become the second largest recipient after California—after San Francisco—of high-tech venture capital in the country. We’ve surpassed Boston, which is an amazing thing, and by some measures … we have more high-tech workers than any other region in the country—about 300,000 men and women more than Silicon Valley and Boston, but we have to do more. Today’s announcement shows that we’re succeeding,” Senator Schumer said.
While New York’s politicians may not think the city needs to beg tech companies to come here and they’re optimistic the Big Apple can supplant Silicon Valley as the global tech capital, that didn’t stop Mayor Bloomberg from playing pitchman at the Facebook announcement and exhorting other companies to make the move to New York before it’s too late.
“The smartest thing tech and social media companies can do is to move to New York City and get tied into our growing tech community right now,” Mayor Bloomberg said. “This is the place where you need to be, so don’t wait until all your competitors are already here and recruiting the best talent.”
Additional reporting by Nitasha Tiku