East vs West: Tumblr’s Karp on why New York is no ‘Valley Jr.’

It could be Biggie versus Tupac. As New York’s technology startup ecosystem grows larger, it is becoming increasingly confident compared with its western sibling, Silicon Valley.

Yet Big Apple founders are taking pride not just in rivalling but in pitching a quite different kind of online upstart, four told a Monaco Media Forum panel event on Wednesday.

Like the east-west rap feud of the 1990s, their alternative approach exposes a cultural schism that enriches the ecosystem as a whole.

Tumblr founder David Karp said:

“The industry in New York right now would like to be known for having different sensibilities.

“The west is about making things scale but not making people’s lives better. It is about indexing, but not about creating.”

Speaking on the same panel, BuzzFeed CEO Jonah Peretti agreed:

“If you’re building a pure technology company, Silicon Valley is still the best place to do it. People there are still nerds; pure technology. But sometimes that hurts them when they need knowledge of a specific field.”

The reality is becoming clear to these folks that a different and more diverse, alternative startup to Silicon Valley’s all-engineering lifestyle is what differentiates east from west.

Thrillist’s Ben Lerer. Photo: Monaco Mediax ©

It draws not just from mathematics but from publishing, music, film, design and more. And it’s not just culture, Katie Beauchamp, founder of fashion-content-commerce cross-over Birchbox, told the Monaco Media Forum panel: “Companies in New York are being founded with business models at the outset.”

All of which is all very well. New York is developing just fine with this relatively touchy-feely bent. But Tumblr’s Karp said New York can compete effectively, even for straight-up Valley engineering talent:

“We thought it would be an up-hill climb to convince these guys to pick up their families and move to the east coast. But we’ve found it easy to leverage.

“You’ve got all these big networks on equal footing — Twitter, Facebook and Google pulling people with very similar offerings — Palo Alto is a very similar community.

“When we show up at the end of that process and say ‘Before you make up your mind on Facebook or Google, spend a weekend with us in New York’, it puts us on a totally different footing. We show them an opportunity that’s as intriguing to them as in Silicon Valley – but in a much better city.”

Thrillist founder Ben Lerer told the same panel: “From a recruiting standpoint – people want to live in New York City.”

That is also rubbing off on investors who, traditionally, had eyes only for California, Karp said:

“West Coast VCs are starting to spend a lot more time out in New York. We’re now getting people from Andreessen Horowitz, Greylock and Sequoia come over. They come to New York and they make a week of it… they hang out with us over the weekend doing something cool.”

This buzz is being amplified with Cornell’s Chelsea Technion facility, but was already fully in bloom despite such initiatives. These programmes concentrate interests, but a city so rich and relatively diverse can provide welcome distractions from the Valley’s tech bubble, Tumblr’s Karp told Monaco Media Forum:

“One really great characteristic of New York is that, after work, you’re not going out and hanging out with people in your industry.

“Walking down the street, seeing everyone with the Dropbox or Facebook T-shirt… they’re building something for themselves rather than, as in New York, for communities of tens of millions of people.

“The west coast feels like a race, whereas, in New York, you’re surrounded by passionate people rather than this hypercompetitive air on the west coast.”

BuzzFeed’s Jonah Peretti. Photo: Monaco Mediax ©

Karp said 50 percent of Tumblr staff were relocators. Of around 60 engineers, a dozen were candidates to join the Valley’s Facebook, Google and Twitter during recruitment. “We’re able to show them a similar opportunity in a better city,” he said.

BuzzFeed’s Peretti suggested that the east coast’s particular flavor of tech boom is now happening because non-technology folk are harnessing increasingly accessible technologies atop their specialist fields to enact niche disruptions:

“As technology becomes cheaper and easier to deploy, you’re seeing people already passionate about these fields in New York building new technology companies in these technology verticals.”

New York may be shooting for a different goal than Palo Alto but, within its own game, hasn’t yet achieved equivalent success, Thrillist’s Lerer noted:

“I think it would be nice if we had some big exits like the Valley.

“The goal is to build really big, important tech companies – the west coast has consistently done that. New York is starting to do that. Tumblr will have some nice eventuality where people will be able to say ‘New York is great’.”

Karp said:

“There are things we’d love to put us on the map to validate us further — but we don’t want to cross over as ‘Valley Jr.’ but as a whole different genre where products and technologies get made.”