New York City’s push to become a tech hub

The 75th anniversary of the transistor — that little device that gave way to the semiconductor revolution and catapulted our world into the digital age as we now know it — got “Marketplace Morning Report” thinking about ecosystems of innovation. All of the people, places and ideas that combine and give way to life-changing technology.

In the case of the transistor it was the famed Bell Labs campus in New Jersey, then the research arm of AT&T. The transistor then made its way to Silicon Valley, and then we got the semiconductor and computer chip revolution. Now we’re checking in on another tech hub that has taken these innovations and run with them: New York City.

Julie Samuels is the president and director of Tech:NYC, a trade group for the tech sector in New York City with about 800 members. She spoke with “Marketplace Morning Report” host David Brancaccio. The following is an edited transcript of their conversation.

David Brancaccio: So New York got Cornell University and the Technion – Israel Institute of Technology, to create a new tech campus. That got a lot of attention when the ribbon was cut. A solid piece of that is open and running. But how should we here in February rate New York now as one of the great centers of technology? Are we there yet?

Julie Samuels: Listen, I think we’re there. I think that New York City is increasingly becoming the center of gravity for so many different kinds of technology companies and people who work in tech. That’s not to take away, obviously, from what’s happening in [Silicon] Valley, which is amazing, or, frankly, in a bunch of other parts of the United States and the world. But what is happening here is unique and is sustainable in a way that, frankly, it didn’t feel like it was before.

I think there’s a specific reason for that. And I think it’s because the next generation of truly large tech companies, those companies are going to exist in subsectors, in specific verticals that are already thriving here in New York, like, for instance, media and tech, real estate and tech, fashion and tech, finance and tech, you name it. As we see companies grow in those spaces, it’s going to have to happen here, where do you have the expertise, where you have the capital, the mentorship. New York is uniquely set up to thrive in that kind of environment.

Brancaccio: I hear what you’re saying, right? New York is unassailably an advertising capital. It’s unassailably a media capital. And these tech companies, how do you distinguish them from advertising and media companies in some cases?

Samuels: I think by and large — really, it’s hard to do that now, to distinguish them. I say this as someone who runs an organization called Tech:NYC: I’m not really sure what the word “tech” means anymore. And it also means, by the way, in moments of market instability, which some might argue is what we’re looking at right now, we’ve got in New York a much more sustainable economy writ large. And we’re seeing proof of that, that even though there have been some layoffs in the tech industry, those folks are going to traditional employers here, maybe in the finance sector, for instance. So we’ve got a safety net here in a way that I think will sustain our tech sector well beyond this moment, and it’s that kind of diversity of an ecosystem, of an economy, that will, I think, really support what’s happening here in the near term.

Brancaccio: I mean, tech companies, but do you think tech in the sense of actual technological innovation here in New York?

Samuels: Oh, yeah, we see tons of it. And we’re increasingly seeing more in areas that you might not expect. Like, for instance, light manufacturing, or biotech, or life sciences. And that’s because the city has made real commitments to these areas that you might not think of as necessarily thriving here, because maybe they take extra real estate. But we’ve seen this across the boroughs. You know, there’s been real investment in the Brooklyn Navy Yard, there’s been real investment in an Industry City, in Long Island City in Queens. We’re seeing all kinds of tech flourish share. You mentioned at the top Cornell Tech, I think that’s been an important driver of this. We have a ton of amazing universities educating engineers and entrepreneurs. And it’s really amazing to see what’s, over the past decade, what’s gone on here.

Brancaccio: I’ve spent a good amount of time down on Wall Street, we do have access to capital. But do we have the right kind of access to capital? l mean Palo Alto, California, has this street that has all these people willing to take crazy risks with tech. Does New York have that here?

Samuels: I think New York definitely has capital here. And you know, more capital than Sand Hill Road, I would argue at the end of the day. The question is how that capital is deployed. And, frankly, I think you’re gonna see what we’re already seeing: What comes out of New York is some of that capital getting deployed almost in a more sustainable way.

I used to live in Silicon Valley. And when I moved here, it was so refreshing. All of a sudden, you heard people talking about things like “revenue” and “profit.” And I was like, “Oh, that’s great.” And I think that because so much traditional finance is here, the industry is a bit more grounded in how you actually build companies that make money at the end of the day. And I think history will show that that’s a good way to look at this economy.

Brancaccio: Yeah, I’ve had to chuckle looking at the history of technology in America. You know, Fairchild Semiconductor, right? It’s just this pivotal company out in California at the dawn of the semiconductor revolution. And where did the money come from for Fairchild? It was a Long Island camera company where the money came from. It was out here, right?

Samuels: That’s right. So I think what we saw in California was that, especially with some of the large internet platforms, I don’t think that a lot of folks, quite frankly, for a long time, were taking those companies seriously. They were out on the West Coast. They had silly names. Folks in government, kind of existing industries, potential competitors, they weren’t taking them seriously. And I think that was a great moment for California. And it allowed these companies to really become very big and very successful in a way that I’m not sure could have happened on the East Coast.

The bubble of being so far away really helped those companies. That is not a knock on the West Coast. But what I’m saying now is we’re in a different moment. And in this moment, you can’t build a company without government paying attention, without regulators paying attention, without competitors paying attention. That’s just — everyone wants a piece of tech now. And so that next generation of companies that’s going to come up in that moment, it’s going to come up here, where we do that stuff all the time, where we get on the subway, where we talk to other people, where we are constantly bumping into new ideas.

Brancaccio: Something else, perhaps not to copy from the California example is that Silicon Valley’s success, many people have noted, widened the gap between rich and poor out there. And as you try to nurture a tech hub here, you’d want to pay close attention to this idea of who gets included in the bounty.

Samuels: I think that’s right. And I don’t … we’re not there yet. I don’t want to pretend that we’ve got this figured out. I think that the tech industry, frankly, across the country has got a lot of work to do to make sure that it is a more equitable industry. That said New York is far ahead of its peers on this. We’ve got a much more diverse set of folks working in tech than in our peer cities. We’ve got City Hall, the mayor here in particular, has committed to helping tens of thousands of New Yorkers access apprenticeships. They’ve made real commitments around workforce training, giving New York City students the opportunity to learn the kind of skills for the next generation of tech jobs. New York City was out front with a program called “<CS4All>” that put computer science education in all New York City public schools. So, you know, at the risk of sounding too Pollyannaish, I recognize there’s more work to do. But I also know here in New York, we’re very committed to doing that work, and I see it happening every day.