4 ms·

'No New York startup has been a breakout hit with a multi-billion valuation' 'Tumblr, the blogging service based in downtown Manhattan, made headlines last May

by brc 13y ago

'No New York startup has been a breakout hit with a multi-billion valuation' 'Tumblr, the blogging service based in downtown Manhattan, made headlines last May when Yahoo acquired it for $1.1 billion. ' I don't know where the writer hails from, but 1.1 billion isn't exactly chump change. It's unlikely that any one city can overtake anotner for a specific industry. It's unlikely that San Francisco coudl ever supplant Wall St, despite San Francisco having a large financial centre. The top people will want to go to Wall St for finance, and the Valley for tech companies. Very hard to reverse that, and I don't see a lot of reasons why anyone would want to.

grinich 13y ago
It's unlikely that San Francisco could ever supplant Wall St, despite San Francisco having a large financial centre. Is this actually that unlikely? Look at the tremendous wealth creation around the Bay Area over the last three decades. There's an unprecedented flood of capital to the area, including private individuals and international investment firms. If you look at the actual numbers, it's astounding and can't really be described as a "bubble." In the 80s, companies would hold a public offering when the had <$25MM in revenue. Today, companies try to stay private for as long as they possibly can, which has resulted in massive private financings. See Square, Uber, Dropbox, Airbnb, Twitter, etc. These are nearly always being led by investment banks, like Goldman Sachs. It's not outlandish to imagine a secondary financial market emerging in SF, designed specifically to fuel the sort of innovation the region has become famous for. The huge banks in America (JP Morgan, etc.) were essentially a result of the industrial revolution. If we're in the midst of another revolution, it's likely a new banking group will emerge. The way of Silicon Valley is to innovate solutions. Nobody is going to try to appeal Sarbanes–Oxley. We'll just build a way around it. Even with it's warts, Bitcoin is one example. Full democratization of commerce and investment is inevitable.
- brc 13y ago
  Yes, it's very unlikely for the same reasons. New York 'Wall St' is a very established industry. The biggest of Tech IPOs are chicken feed compared to the money going through New York on a daily basis. If you want to be at the top of finance, you have to be in New York. Anybody who wants to work to the top, will end up in New York. The reverse applies to Tech, which is why both will stay top of their game for their respective current strengths. It's completely wrong to think of New York in terms of just JP Morgan as it is wrong to think of Silicon Valley as just Apple. New York doesn't care about the origin of the wealth. It's about raising the capital, repackaging it, and on-selling it, and trading it all the while. So any wealth generated in San Francisco that makes it as far as the public markets will end up going through NY anyway.
deleted 13y ago
[deleted]
williamcotton 13y ago
I'll bet you 0.5 bitcoin that in 20 years the financial industry is bigger in San Francisco than in New York.
- jonas21 13y ago
  I don't know why this is getting downvoted. It cleverly points out that the odds of SF overtaking NY as a financial center is related to the success of technological alternatives to the established financial system.
- NkVczPkybiXICG 13y ago
  How about 500 USD to be settled in bitcoin (or similar virtual currency)? The metric for winning will be where the top (by market cap) 10 finance companies are headquartered at midnight Apr 28, 2034. If more are in NYC, I win. If more are in San Francisco, you win. If it's a tie, the "next highest" will be added until it isn't a tie. Deal?

by brc 13y ago

grinich 13y ago

It's unlikely that San Francisco could ever supplant Wall St, despite San Francisco having a large financial centre. Is this actually that unlikely? Look at the tremendous wealth creation around the Bay Area over the last three decades. There's an unprecedented flood of capital to the area, including private individuals and international investment firms. If you look at the actual numbers, it's astounding and can't really be described as a "bubble." In the 80s, companies would hold a public offering when the had <$25MM in revenue. Today, companies try to stay private for as long as they possibly can, which has resulted in massive private financings. See Square, Uber, Dropbox, Airbnb, Twitter, etc. These are nearly always being led by investment banks, like Goldman Sachs. It's not outlandish to imagine a secondary financial market emerging in SF, designed specifically to fuel the sort of innovation the region has become famous for. The huge banks in America (JP Morgan, etc.) were essentially a result of the industrial revolution. If we're in the midst of another revolution, it's likely a new banking group will emerge. The way of Silicon Valley is to innovate solutions. Nobody is going to try to appeal Sarbanes–Oxley. We'll just build a way around it. Even with it's warts, Bitcoin is one example. Full democratization of commerce and investment is inevitable.

brc 13y ago
Yes, it's very unlikely for the same reasons. New York 'Wall St' is a very established industry. The biggest of Tech IPOs are chicken feed compared to the money going through New York on a daily basis. If you want to be at the top of finance, you have to be in New York. Anybody who wants to work to the top, will end up in New York. The reverse applies to Tech, which is why both will stay top of their game for their respective current strengths. It's completely wrong to think of New York in terms of just JP Morgan as it is wrong to think of Silicon Valley as just Apple. New York doesn't care about the origin of the wealth. It's about raising the capital, repackaging it, and on-selling it, and trading it all the while. So any wealth generated in San Francisco that makes it as far as the public markets will end up going through NY anyway.

deleted 13y ago

[deleted]

williamcotton 13y ago

I'll bet you 0.5 bitcoin that in 20 years the financial industry is bigger in San Francisco than in New York.

jonas21 13y ago
I don't know why this is getting downvoted. It cleverly points out that the odds of SF overtaking NY as a financial center is related to the success of technological alternatives to the established financial system.
NkVczPkybiXICG 13y ago
How about 500 USD to be settled in bitcoin (or similar virtual currency)? The metric for winning will be where the top (by market cap) 10 finance companies are headquartered at midnight Apr 28, 2034. If more are in NYC, I win. If more are in San Francisco, you win. If it's a tie, the "next highest" will be added until it isn't a tie. Deal?