Brooklyn, known for its live-work lifestyle, millennial residents and artisanal doughnuts, is carving out a space for New York City's tech community.
According to a 2015 report published by the Brooklyn Tech Triangle, more than 1,350 tech companies have established roots in the space between the Brooklyn Navy Yard, DUMBO and Downtown Brooklyn, employing over 17,300 people in the process. The borough has grown into a destination for startups and established tech companies alike, popularized by shared work spaces, reclaimed factories and bohemian offices.
The report also found that if Brooklyn’s tech community continues to grow at the same rate, the area will rake in $15.5 billion by 2025 and run out of commercial space by 2020.
So it's clear — Manhattan's neighbor to the east has stealthily and quickly become a startup hub in its own right. But how did it get there?
Legacy companies anchor Brooklyn tech
A number of New York City’s largest tech companies have set up campuses in Brooklyn, with Etsy and Kickstarter in Greenpoint, Livestream in Bushwick and MakerBot’s manufacturing headquarters in Sunset Park.
In 2013, Stratasys acquired MakerBot in a $403 million deal and in 2015, Etsy became New York City’s largest tech exit ever with its $1.8 billion IPO in 2015. Brooklyn is also home to one of New York City’s most prominent unicorns, Vice, which was valued at $2.5 billion in 2015.
“For a long time, Wireless Generation and Etsy were the only startups out here,” said Charlie O’Donnell, Partner at Brooklyn Bridge Ventures. “Now you've got Vice, Genius, Livestream, Tinybop, goTenna, Maker's Row, Farmigo and lots of others. The willingness to be out here is so much higher, largely driven by the residential move to Brooklyn.”
And this is just the beginning. With cheaper rents and shorter commutes, many of New York City’s early-stage companies are choosing to set up shop in Brooklyn from the get-go. From coliving to podcasting networks to tech-enabled real estate platforms to virtual reality journalism, the borough is experiencing a tech renaissance to compliment its community of builders, makers and innovators.
“The tech startup world in Brooklyn is such an awesome place to be right now,” said Andrew Pratt, Principal Broker at Nooklyn. “There is an energy here that is undeniable, addictive and contagious. Brooklyn is on the forefront of American culture generally, and the tech scene is no exception. It's this radical place where transformational cultural shifts are happening at lightning speed, and technology is changing virtually every industry at the same pace — so the two go hand in hand. Everyone here is pushing the envelope and doing it with an intensity that is only found in New York. Being in the midst of that really pushes us to be constantly thinking of and trying out new ideas, and that is the key to real progress. If you're a tech startup in Brooklyn in 2016, you have to be on the cusp by default — if you're not, you won't survive.”
Brooklyn attracts female founders and influential VCs
Brooklyn’s population of women entrepreneurs has surpassed all other tech hubs, even outpacing San Francisco, Boulder and Palo Alto. 28 percent of the city’s startups are run by women, spanning across e-commerce, media, education and healthcare industries, to name a few.
Additionally, some of tech’s most prominent venture capitalists are taking big bets on Brooklyn startups. Joanne Wilson, who heads Gotham Gal Ventures, has invested in Brooklyn-based Mouth Foods, Madison Plus Select and HowGood. Reddit founder Alexis Ohanian invested in content site Atlas Obscura as well as video company VHX. Brooklyn Bridge Ventures, which is run by Charlie O’Donnell and manages $23 million across two funds, was the first venture capital fund to make its home in Brooklyn.
“The most exciting thing about Brooklyn is that people aren't seeing it as a far away place anymore,” said O’Donnell. “More than half the tech community lives in Brooklyn and you've now got two VC firms here — not to mention the best new restaurants and the most exciting park in the city. The outer boroughs all enable NYC to scale in a way that San Francisco, for example, doesn't. If you're not in SF proper, you're off the map. Here, people living and working just a few subway stops outside Manhattan are still dynamically integrated into the community.”
New developments
Recently, a number of major developments have broken ground in Brooklyn, solidifying a promising future as an urban hub for innovation. In May, the city began construction on a 675,000-square-foot commercial office building in the Brooklyn Navy Yard that will be anchored by WeWork.
1776, the well-known incubator and seed fund that grew out of D.C., is also opening a campus in the Navy Yard’s Building 77. The space is set to support 3,000 new jobs.
“The Brooklyn Navy Yard specifically encapsulates so much of what makes New York City great — it has fantastic industries, a public-private partnership, and independent local artisans like Brooklyn Brewery and Russ and Daughters,” said Rachel Haot, 1776’s Managing Director of New York City. “All of the people involved want to change the world through innovation, sustainability and access. We're seeing so much of tech go that way, and Brooklyn is helping to lead the charge for New York right now. Mayor Bill de Blasio and his administration are committed to it. New York has led the way in so many industries for a couple of centuries at this point, and it's important to note that tech is infusing everything we do. Brooklyn is helping all of New York City to stay on top.”
