Escaping the herd mentality: why some Aussie startups are choosing the Big Apple over Silicon Valley
Thursday, December 18, 2014/
A growing number of Australian startups are moving to New York rather than Silicon Valley in order to chase partnerships with major brands and shake off the group-think of San Francisco.
Yesterday, contactless communications startup Tapit announced it was expanding into the US market by opening an office in New York.
Co-founder and chief executive of Tapit Jamie Conyngham told StartupSmart
the startup has previously collaborated with major international brands and wanted to position itself close to its clients.
“There’s a concentration of media in New York and a lot of iconic brands have their global headquarters there,” he says.
“So it made more sense for us to relocate there rather than in San Francisco.”
Tapit has recently undergone a rapid international expansion – with offices in Tokyo, Shanghai and Dubai – and Conyngham says a headquarters in New York will allow his team to pitch to brands face-to-face (because Skype “only takes you so far”).
Kate Kendall, the founder of Cloud Peeps, moved to San Francisco from Melbourne in 2010 and has been living in New York for the past two years. She says a combination of industry and market-reach factors influenced her decision to remain in New York while working on her startup.
“San Francisco is amazing because it’s the equivalent of Hollywood – it’s where you have a lot of tech talent and tech giants – but the drawcard for New York is you’ve got eight million plus people,” she says.
“San Francisco is a baby city in comparison to New York.”
However New York was also a personal preference for Kendall, who says positioning herself away from San Francisco allowed her to challenge herself.
“When I first went there [San Francisco] there were a few Aussies and then it exploded,” she says.
“I wanted something new and challenging and San Francisco felt like another Melbourne. People want diversity and the thinking about the tech space in New York is … instead of it being a tech ecosystem, it’s tech within other ecosystems – media, finance, art.
“There is a very big bias in Silicon Valley of what constitutes a tech company and what constitutes a problem you should be solving, and after a while everyone can be working on the same thing and solving problems for what is a niche area and niche problem set.”
Kendall also points out that in New York, she doesn’t realise she is a female entrepreneur.
“When I first moved here and started going to events there were so many incredibly talented, ambitious, driven, funded women in the room. It’s funny because it does feel like nowhere else on earth in terms of tech and startups.”
Kendall is involved with Down Under New York, a tech meetup designed for Australians living and working in the Big Apple. The acronym for the meetup – DUNY – doesn’t escape the attention of attendees, either, and sparks a few conversations about Australian slang.
Kendall says in the last few months she has seen an “absolute onslaught of Aussies move into New York”.
Although there is a notable downside: the weather.
“It does get to minus 15 degrees in winter, so sometimes I wonder if I made the wrong choice,” she says.
“The weather does suck – it’s absolutely freezing.”