The VC Office and the Concentration of Capital

Profiling New York–based venture capitalists and VC firms that have been established in the city since the early 2000s, the chapter examines their risky but privileged perch between Wall Street and Silicon Valley. Interviews with VCs are juxtaposed with the post–World War II history of venture capital as a distinctive form of investment and management. The VCs’ equally distinctive commitment to New York is then contrasted with the increasing geographical dispersal of their investment funds to other regions of the world. Meanwhile, the integration of some corporate and VC members of the tech “community” into New York’s business establishment suggests the formation of a local tech-financial elite, updating C. Wright Mills’s critique of the institutional bases of power.

Hackathons and the Spirit of the New Capitalism

This chapter dives deeply into the subculture of hackathons as a paradigmatic event of the new economy. Using ethnographic observations and interviews with participants at seven public hackathons sponsored by companies in New York, the account shows how the weekend-long competition to write computer code socializes highly skilled, young tech workers to produce “innovation” on demand. Corporate sponsors appeal to participants’ love of coding and “building things” as well as their desire to build their résumés, promising jobs, networking, and glory to winners who can produce marketable products and ideas. Participants willingly engage in both self-exploitation and self-promotion, aware that corporate sponsors have the upper hand but enjoying the sense of play, mutual learning, and collaboration-with-competition that hackathons foster. The combination of self-exploitation and self-promotion, amid both emotional and rational appeals, represents the culture of the new economy and sets a new, permeable boundary between personal life, workspace, and worktime.

Author’s Note

Although it is fashionable for sociologists to say they use “mixed methods” to do research, documenting the development of the innovation complex in New York really required me to take a variety of approaches and journeys. In many ways this project marked a return to the research strategies I used in my first New York book, ...

“The Address of Innovation”

This chapter shows that “innovation” is basically a political category that brings the most benefit to investors, corporate executives, and real estate developers who control the supply of land and circulation of financial capital. Highlighting tech’s corporate power over cities, we see Amazon’s plan to open a second headquarters in Long Island City, New York, defeated by public protest against government subsidies to tech titans. The chapter also examines the jobs that are created by the growth of the tech industry, the effects of capital gains of highly successful tech founders on urban housing markets, and the ideological effects of the “post-political” crisis management sponsored by the World Economic Forum, including a brief comparison with the innovation complex in China.

Pipelines

The innovation complex depends on parallel “pipelines” to train and recruit highly skilled tech “talent” for jobs in digital industries and other organizations that use digital technology. The most elite pipelines are Ivy League and expensive, private universities—Cornell Tech, Columbia, and NYU—which offer bachelor’s and master’s degrees in information sciences and merge engineering and business skills. Less prestigious and initially less connected to the tech ecosystem is the city’s public university, CUNY, which offers degrees in computer sciences and new tech training programs begun by Mayor Bill de Blasio’s administration. A third, alternative pipeline has been established by privately owned, for-profit bootcamps that offer intensive, in-person, and online courses, including both tuition-paying students and those whose fees are subsidized by the New York City Economic Development Corporation. The chapter uses interviews and institutional narratives to document the development of these pipelines.

Accelerators, Startups, and the Circulation of Capital

This chapter examines the origin stories and career paths of New York–based startup founders, explaining how the growth of startups is directly connected to the emergence of tech accelerators as both “factories” for new tech businesses and “finishing schools” for their founders. Interviews with four founders in different spaces are interwoven with the development of accelerators from the privately owned Y Combinator to post-accelerators like New Lab at the Brooklyn Navy Yard, which is privately owned but sponsored in part by the New York City Economic Development Corporation. Accelerators appear as both spaces of socialization for the new economy and effective means of circulating social, cultural, and financial capital.

Meetups

New York Tech Meetup emerged in the early 2000s as a formative organization in the city’s innovation ecosystem. Every month, hundreds of mostly young people and a few potential investors come to see computer coders and startup founders “demo” new apps and platforms they have created. In the 2010s, the tech meetup was joined by other organizations that also claimed to mobilize and speak for New York’s tech “community,” notably, the nonprofit organization Civic Hall, specializing in “civic tech,” and Tech:NYC, a nonprofit industry association. The chapter uses ethnographic observations and interviews with leaders of these organizations to document their efforts to “leverage” the membership for a role in tech policymaking in the city.

On the Waterfront

The transformation of industrial ruins on the Brooklyn waterfront into New York’s newest tech district shows how urban spaces come to embody fictional narratives of economic growth shared by venture capitalists, economic development officials, university presidents, and real estate developers: the people who form a city’s “growth machine.” Both real and hyped, the building of the innovation complex on the waterfront results from an ingenious use of public money to leverage private investment, investors’ self-interested desire to shield capital gains or procure US visas, and sheer speculation in tech-led growth. Among notable projects in this de facto innovation district, the chapter examines the Brooklyn Navy Yard and the Brooklyn Tech Triangle. Interviews with major participants in the development process are combined with descriptions of specific sites and analysis of the rise of the “innovation district” model in urban economic redevelopment after 2010.

Imagining Innovation

Since the 1980s, and with greater force since the 2010s, the trope “innovation and entrepreneurship” has inspired visions of a more charismatic form of global capitalism led by young, mobile “talent” in dynamic cities. After the economic crisis of 2008, city government leaders, corporate CEOs, and real estate developers joined forces with university presidents, venture capitalists, and big tech companies to make this vision a reality. They turned to digital technology to reverse the losses brought by financial institutions and revitalize legacy industries, aiming to create an “innovation complex” of buildings and attitudes that would make their city more competitive for investments and jobs. This chapter highlights the history of the innovation complex in New York in the aftermath of the 2008 economic crisis and the growth of computer software, venture capital, and global interest in startups.