As 2016 begins, New York City closely trails Silicon Valley as the second-largest tech hub in the U.S. As a self-sustaining ecosystem for disruption, New York’s tech scene is well-positioned for growth, and the new year will assuredly bring a new wave of innovation to the city.
We sat down with four New York tech influencers to talk all things startups, and they provided their informed predictions on the state of tech in New York City, along with the biggest challenges the industry will face this year.
Tech predictions from:
Should we continue to see the same type of growth in 2016 we saw in 2015?
JW: 2016 will be the year of reality. [There will be] acquisitions, real valuations and a shift in how people think about funding ideas and companies.
BH: While the pace of venture financing will likely slow this year, companies tackling real problems with real business models will continue to grow and get funded. Given that a lot of those problems exist in large, legacy industries like real estate, education and finance — New York's sweet spots — our city will weather a venture downturn with comparative strength.
BU: Last year we saw heightened growth through the summer and then a tapering back in the second half of the year. I expect that we’ll continue to see monster deals and growth this year, but it will be driven by more realistic market expectations around revenue, profitability, and users. Even though investors are cash rich they are beginning to focus more on fundamentals than in the recent past.
How do you think the startup community will be different in 2016?
JW: The startup community will think more about driving revenues from the start. If you can't prove that you can bring in the cash then it will be more difficult to get funding.
BU: We’re seeing the startup community becoming younger and younger over time. Kids are becoming a larger part of the developer ecosystem and getting their entrepreneurial bug while still in school. Globally, we're seeing technology booms throughout Asia, South America, all over. These communities are really accelerating and it's exciting to see.
How will New York City continue to strengthen its tech community in 2016?
JW: NYC has become a place where you want to start a company and that will continue to get stronger over the next year.
BH: New York City is and will remain a great place to start and build a company. The city's base of large, traditional industries such as finance, media, real estate and retail will continue to provide inspiration for entrepreneurs and talent for startups in 2016. Having been an entrepreneur in New York since 2008, I have always loved our startup community's togetherness and culture of sharing. I believe these traits were fostered among technology entrepreneurs by being 'outsiders' in a city dominated by those legacy industries. I hope that the success of New York's startup community does not erode the culture and community that made us great.
BU: With NYC plans to build a wifi grid, both above ground and in the subway, we can expect the city to become a more connected place than ever before. Currently, DigitalOcean is developing a community space inside our office, and I’d love to see it become a Tech Hub that fosters innovation and sharing this year. New York City is an amazing amalgamation of so many industries; we want to showcase how technology plays a crucial role in evolving different verticals.
Is there one particular sector you think is set to boom (media-tech, fintech, etc)?
JW: We have seen media/content become more powerful in 2015. There are a lot of startups in the fintech, edtech and healthtech arena and at one point a few will pull out of the gate as powerful companies.
Are there any big problems that New York tech needs to tackle?
JW: The biggest problem is the lack of programmers. AFSE, the Academy for Software Engineering, is changing that [by] bringing curriculum into the public school system from elementary school to high school. Every kid will touch programming at one point and that is the key to building a workforce for the future of NYC.
AR: The biggest problem facing the growth of the NY tech community is the lack of a stable and sustainable tech talent pipeline to support not only emerging startups, but also to help New York's traditional industries adapt and compete in the 21st century economy. Our public schools are massively underfunded and lacking in trained teachers to help New York City's 1.1 million students learn rapidly changing digital skills that they need to succeed for future jobs. Worse, the majority of public officials responsible for the quality of our public schools have no strategic vision for upgrading the schools to produce the quality and quantity of people needed to be the workforce to support the city's future. The only way to change this dynamic is for the New York tech community to significantly support visionary and ambitious initiatives like the Computer Science Foundation of New York and others who are developing programs to train more public school teachers to teach computer science. If the New York tech community is serious about growing our tech ecosystem in a sustainable way that allows us to compete with other cities around the world, we have to take action now and take responsibility for solving this problem which seriously threatens our city and its economic future.
Any other thoughts, observations, or reflections?
JW: Startups are growing up. That is changing the way we live our lives. We will continue to see that growth over the years to come and that is a very good thing.
RT: In the last 25 years we’ve seen the birth of the Internet, mobile phones, and social media. Consumers have more power than ever and as a result, they expect more out of brands. Social media is playing a crucial role in how large organizations engage with consumers, and we’re working to help the enterprise adapt to the age of the connected, empowered consumer.
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