‘A Constant Adrenaline Rush’: 3 New York City Founders Give an Inside Look at Building Their Startups in the Big Apple
“Gritty, loud, and vibrant.” “Constant adrenaline rush.” “Unbridled ambition and energy.”
That’s how three founders who built their New York City startups describe the place they call HQ.
While Silicon Valley is often considered the epicenter of technological innovation, a new wave of tech entrepreneurs are showing up to challenge this assumption. “San Francisco as the de facto capital of tech is done,” famed investor Balaji S. Srinivasan recently declared.
San Francisco as the de facto capital of tech is done. That time and place is over. There’s no point in moving there for tech, the businesses are shut down and people aren’t meeting up.
It’s all internet now, for a while. And relocation to towns and cities around the world.
— balajis.com (@balajis) August 27, 2020
As Silicon Valley is losing its stronghold as the center of the tech world—a process expedited by the COVID-19 pandemic—innovative new tech startups and businesses are springing up in far-flung corners of the world. But New York founders insist that their home city has that je ne sais quoi that infuses their businesses with lively creativity and energy unmatched anywhere else.
“It’s wild—when your plane lands back in New York, you feel more energized to go crush it than you do when you’re anywhere else in the world,” says Jared Parker, CEO of Rasgo. “And I’ve traveled everywhere.”
We sat down with three New York City founders to find out what makes this city such a special place to build a top tech startup and how it stacks up against Silicon Valley—plus an unflinching look at its unique challenges.
Nabeel Alamgir—Bengali transplant finds home in the restaurant industry
As a teenager, Nabeel Alamgir learned to speak English watching mafia movies. He and his family had moved to Queens, New York to escape poverty in their native Bangladesh. “I watched Scorcese films like Goodfellas dozens of times,” he recalls. “They were entrepreneurial, they were immigrant stories, and they left a deep impression on me.”
Inspired by the hustle he saw on the silver screen, Nabeel took a job as a busboy at Bareburger for a decade and eventually worked his way up to chief marketing officer. “The opportunities I have were all because my parents picked this place,” he says. “My story would have ended up very different in another city.”
Today, he’s the CEO and co-founder of Lunchbox, a digital ordering platform for restaurants, which recently surpassed 100 employees. “Our company was built by a bunch of awesome immigrant New Yorkers,” he says. “In New York, the diversity is not forced. It just happens.”
Nabeel likens the new immigrant experience in New York City to making friends on the first day of school. “If you start at a new school in the middle of the school year, everyone’s already made friends so you’ll probably feel left out,” he says. “But if it’s the first day and everyone is new, you’re all scared together. It’s easier because everyone’s vulnerable. That’s like New York. Everyone is new, it’s a city of transplants. Everyone is super supportive and welcoming.”
“This city has the best graphic designers, writers, and photographers in the world. If you’re going to tell a story meaningful enough to win investors and customers, you’ll get nowhere without those artists in your corner.”
Nabeel strongly believes not just in diversity of backgrounds but in a diversity of ideas. And nowhere does this melange of ideas flourish more than in the Big Apple. “New Yorkers are not afraid to ruffle feathers and make their voices heard,” he says. “Our engineering team and our client-facing team duke it out all the time.”
He attributes the success of the company—which is now rolled out in 30 states—to being the byproduct of those two departments clashing. “I don’t think we’d be half as successful as we are today without a ragtag group of innovators having at it.”
“Sure, it can be painful when teams fight. But what’s the alternative? They don’t fight and we don’t grow? That’s even scarier,” he says.
Not unlike Silicon Valley, Nabeel has faced some capital challenges in New York City when looking for funding. “For our seed round, we got rejected 72 times,” he says. With intense grit and determination, he eventually closed the round, paving the way for a $20M Series A in 2020. “It’s easier to raise startup capital in Silicon Valley, and the valuations are better. You can get away with half the case studies or pattern matching—investors will still take a leap of faith.”
But Nabeel wouldn’t dream of basing his business elsewhere. For one, “New York City is the mecca of restaurants,” he says. “And the customers in New York are first movers—they’ll try technology faster and adopt it better than in other cities. We support some of the best restaurateurs in the city.”
Finally, Nabeel insists that New York artists are the beating heart of his brand. “Our branding is very NYC. Our colors, our tone, our voice—it’s all very loud and gritty. This city has the best graphic designers, writers, and photographers in the world. If you’re going to tell a story meaningful enough to win investors and customers, you’ll get nowhere without those artists in your corner.”
Jared Parker—NYC-based startup founded in the throes of the pandemic
If an NYC-based startup is founded during a pandemic, is it really an NYC-based startup?
Jared Parker, founder and CEO of Rasgo, says yes. He founded the company in July 2020, so he hasn’t been able to open an office in the city. But despite not being able to wine and dine customers at the Catch Rooftop or have team happy hours at Angel’s Share, Jared believes that the essence of NYC still leaves an indelible mark on the business.
“New York City has a very specific culture that’s not replicated anywhere else in the world. Nowhere else will you find that raw energy and ambition seeping through the air. If you’re a New Yorker, the sidewalk is your race track,” he laughs. “Even though our team is distributed throughout the United States, all employees have that same grit and energy. We screen for that when we hire. It’s non-negotiable.”
Rasgo’s 12-person team is fully remote, with employees in California, Washington State, West Virginia, Tennessee, New York, and North Carolina. While the NYC energy is an essential part of Rasgo’s DNA, Jared recognizes its limits. “True New Yorkers have a level of energy and ambition that will run other people down,” he admits with a laugh. “I’ve had to learn to hold back a bit to avoid burning the team out. It’s important for New York founders to be cognizant of that and empathetic—not everyone operates at the same speed.”
“New York City has a very specific culture that’s not replicated anywhere else in the world. Nowhere else will you find that raw energy and ambition seeping through the air. Even though our team is distributed throughout the United States, all employees have that same grit and energy. We screen for that when we hire. It’s non-negotiable.”
While building a startup during a pandemic has major downsides, like a lack of face-to-face interaction with customers, it has been a major advantage for Jared in terms of raising capital. “I think if we’d started in 2019, we’d have felt outside of the center of the action being based outside the Valley. But we were able to meet with all the top VCs on Zoom,” he says. “Now the top VCs have comfort doing company diligence over screenshare. The pandemic has forced that comfort, and now it’s here to stay.”
Originally from Tennessee, Jared has lived in 12 different cities in three countries. But he insists New York is the best place to build a business—better even than Silicon Valley. He maintains that it’s easier to sell to the NYC market. “On the West Coast, a lot of companies have the internal engineering talent to build software solutions themselves. But if you look at the East Coast, Midwest, and Europe, you have a lot of tech-forward, modern organizations that want cutting-edge technology, but won’t build in-house. These folks are hungry for what we offer.”
Jared also believes that being based in New York gives him access to a wider, more diverse cross-section of customers. “A lot of founders forget that Silicon Valley only represents a tiny sliver of the total addressable market,” he says. “As an early-stage founder, your only job is to be completely obsessed with understanding the user’s biggest pains, and how you can best solve them. But if you over-index on building for Silicon Valley users, who tend to be outliers in many ways, you’ll leave most of your user base unsatisfied.”
Dennis Thankachan—rubbing elbows with the best and the brightest in the biz
There’s a certain level of serendipity that can only happen in New York, according to Dennis Thankachan, co-founder and CEO of Lightyear. Mark Cuban became an investor in his company purely because of happenstance. “I met an investor who introduced me to his friend, who shot me a text out of nowhere and said, ‘Hey Mark Cuban wants to meet you.’”
There’s more. “We’re also getting Barry Sternlicht to invest in a round,” says Dennis. “It’s because I was at this birthday party in Manhattan and I met a guy who is a proper New York socialite and happens to know everyone.”
Born and raised in North Jersey, Dennis went to high school and college in Texas, then moved to New York after college to pursue a career in investment banking. “There’s just no better place to do that than New York City,” he says. “Things move a bit faster here. You can feel the spirit of competition and self -improvement in the air. If you channel it in the right way, it makes you a better person.”
“When you’re an entrepreneur, it forces you to be very self-conscious and introspective. You’re constantly expected to grow and it’s hard not to compare yourself to other founders every time you see them raising a new round. Sure, that exists in NYC, but it’s an order of magnitude stronger in a market like San Francisco.”
Pre-pandemic, Dennis would travel to Silicon Valley a couple times a year. “There definitely is something different in the air over there. There’s a stereotypical futurist Silicon Valley mind that does exist. And I’ll admit that sometimes I do feel left out of that,” he says. “But I also feel like being so immersed in that can be a little toxic.”
“When you’re an entrepreneur, it forces you to be very self-conscious and introspective,” he explains. “You’re constantly expected to grow and it’s hard not to compare yourself to other founders every time you see them raising a new round. Sure, that exists in NYC, but it’s an order of magnitude stronger in a market like San Francisco.”
Dennis feels it’s healthy to come up for air after long days spent immersed in tech entrepreneurship. He loves that his city is home to arguably the world’s greatest arts scene, as well as a top destination for myriad industries and hobbies. “Most of my friends are not entrepreneurs or venture capitalists. And I like it that way.”
Dennis hasn’t had trouble raising funds from the Valley, and it’s only getting easier as the pandemic makes digital-first investing de rigueur. “Most of my cap table are people based in the Bay Area, and I’ve lost no access to them,” he says. “Plus, I have preferential access to the large and growingNYC network of investor ecosystem.”
Dennis is pleased to see that the pandemic has removed borders for many founders, making it easier to raise capital no matter where they’re based. It levels the playing field and allows diverse founders from around the world to more equitably access funding and resources. “That is a really good thing,” he says. “It is ridiculous that there would be a single place with a population of 800,000 that has a stranglehold on the entire venture capital ecosystem.”
Founders ❤️ NY
Building a business amidst New York City’s sky-high cost of living, fiercely competitive talent market, and distance from Bay Area investors is not for the faint of heart. Yet the love affair that Nabeel, Jared, and Dennis each have with the city is unwavering.
With a city as large and multi-faceted as NYC, they each have a slice of the city that’s uniquely meaningful to them—a fact that’s readily apparent when you ask them their favorite things to eat in the city.
“My mom’s dal, hands down,” insists Nabeel.
“Spinach gnocchi from Malatesta,” says Jared.
“The pizza. It’s literally the best pizza in the world,” says Dennis.
In spite of their differences, the three founders agree that it is the place to be for ambitious tech entrepreneurs who want to prove they can build something meaningful. In the words of crooner Frank Sinatra, “If I can make it there, I’ll make it anywhere.”