I read an article in the San Jose Mercury News on the way dot-coms of yesteryear chose office space compared to startups today: How startups survive the space wars. The article explains that office space is an important part of a newly-formed company’s business plan. In a nutshell, the big difference between then and now – entrepreneurs are more cautious. Today, they seek flexible space to grow into and only commit to a lease when the business can prove worthy of the expense.
The article got me thinking about office space for Capital region entrepreneurs and how the needs differ for their California counterparts. While the look and feel of an office and its amenities are similar for startups on both coasts, the biggest difference is in the size of the property market and the demand for space.
Abundant brain power, innovation and drive can certainly be found in spades on both shores. Yet the nation and beyond flock to the entrepreneurial mecca of Silicon Valley, which has spread throughout the state. As a result, these vulnerable west coast startups scrounge for square footage at exorbitant rates. As the article points out, “it’s a landlord’s market.”
West coast startups would salivate for the amount of affordable quality office space available in the Tri-city area. New CEOs in the east have their pick of either a sleek minimalist look or 19th century building with original crown molding, exposed brick and hardwood floors – either of which could overlook flowing rivers or sweeping hills.
By contrast, Capital region entrepreneurs drool for the seeming glut of venture capital and a supportive startup infrastructure found along the Pacific. Without early funding, Upstate NY startups work in college computer rooms and in cafes long after they’ve outgrown these spaces.
In the highly competitive California job market where companies large and small continually poach talent from each other, expensive office amenities like gyms, catering and high-design lounges are expensive necessities vital to lure employees. For the Capital region, they’re less costly, “nice-to-have” add-ons.
Entrepreneurs in the northeast long for the electric pulse and innovator’s vibe that co-mingling with other inventors creates within California’s entrepreneur-driven communities. On the other hand, the excessive competition out west means those startups struggle to differentiate themselves among the throngs of businesses with similar apps and gadgets.
While both sides certainly have their pluses and minuses, the northeast has a budding infrastructure and room to grow compared to the overcrowded west coast. Regardless of the view, however, the grass is truly greener in NY's Tech Valley.
Deanna Dal Pos is a commercial real estate agent in the NY Capital region and a global entrepreneur.