How 10Gen Is Pulling Engineers from Wall Street to Become an Anchor of NYC Tech
No one's ever accused New York City of being soft. But New York tech, on the other hand, has gotten that rep. All too often, the city's startups have been built on the shoulders of technology developed on the West Coast. Meanwhile New York's homegrown tech talent has eschewed the start-up community and instead followed the money: to media, advertising, and Wall Street.
The invasion of hardcore tech giants like Google, which has 2750 employees in its Chelsea office, is starting to bring NY tech talent back into the fold. Likewise, eBay's new NYC headquarters will have 200 heads, mostly engineers. Facebook and Twitter have large offices in New York, but those offices are not yet engineer-heavy.
But what about honest-to-goodness NY tech companies? As the West Coast tech giants descend, one of New York's most "hardcore" tech startups is quickly sopping up as much engineering talent as it can.
10Gen is the developer of open source database system MongoDB, and is often held up as a counter-example to criticisms that New York startups are a bunch of design-heavy consumer Internet apps. It's basically the only pure tech startup in the city.
10Gen is using that differentiator to fight the talent wars, and, thus far, it's working. The company started 2011 with 25 employees. By the start of this year, it was up to 100. It'll end 2012 with 200. Nearly 50 of the new hires this year have been engineers. Twenty of the company's 26 summer interns (plucked from 800 applicants) were engineers. The company has paid for these hires with its $73.4 million in venture backing, and revenue growth proportional to its growth in head count.
Engineering talent is as hot a commodity in New York as it is in the Valley. Here, startups not only compete with each other for talent, they're competing with those massive ad agencies, media organizations, and financial corporations with vastly deeper pockets. And the arrival of Google, Facebook, eBay, and Twitter is a double-edged sword -- bringing credibility to New York as a startup hub, but making recruiting in that now-credible startup hub that much more competitive.
A startup can't win a salary battle with Google, or Razorfish, or VivaKi, or JP Morgan. So 10Gen has to trade on the one thing those places can't offer: a challenge.
The company sells itself on its ability to challenge employees to solve difficult, highly technical problems each day. "We're giving them more interesting and challenging work and smarter colleagues," says 10Gen President Max Schireson. Being an open source company helps. Many of its hires come from engineers who already contribute to the database in their free time.
The company has big plans. 10Gen's vision is to build a software platform company akin to Redhat or Oracle, Schireson says. "That's the type of company we want to build," he says. "Those companies don't get acquired."
That's good news, because New York's tech scene needs a few big anchor companies. It's been said many times over that for New York tech to come into its own, we need deep pocketed investors willing to support large follow-on rounds, and we need a few massive tentpole companies that, instead of selling to Valley companies, stay here and grow until they are the acquirers themselves.
At PandoMonthly last month, Thrillist's Ben Lerer said he believes New York needs several billion-dollar, and even $10 billion, companies. Everyone had pinned their hopes on Gilt Groupe, but that's not likely to happen now. Zocdoc could be one such company, he suggested. Etsy may, too.
New York is starting to experience big exits. This year's sales of Buddy Media and OMGPop created enough new angel investors to make a difference. But we shouldn't stop and congratulate ourselves on those deals just yet for a couple of reasons: One, they both sold to Silicon Valley companies. Two, they're both sub-$1 billion deals.
Wall Street's hogging of the technical talent is the reason Paul Graham says New York will never rival Silicon Valley. 10Gen's Director of Talent Acquisition Rockman Ha argues that the finance industry here is an asset, not a detriment. New York can become a hub of pure tech precisely because of its proximity to Wall Street.
The company is proving Graham wrong by luring in engineers -- previously cogs in the wheel on Wall Street -- with its promise of making a real difference in the software industry. Isn't that what used to lure engineers out to Silicon Valley in the first place?