Accel Partners, the firm backing Facebook and Groupon, said it has opened an office in New York, giving the city’s growing tech scene another profile-raising boost. The move doesn’t mean it will relocate partners or hire New York-based partners but appears aimed at helping the existing partners do business in New York, where they increasingly visit.
Still, the new office is a recognition that New York has grown in importance and could signal more migration of VC firms to New York. Super angel investor Ron Conway now says 20 percent of his companies are in New York up from 5 percent. First Round Capital recently also opened up an office in New York to take advantage of the growing Internet scene.
Accel, which already has offices in Palo Alto, Calif., London, India and China will take up residence near Broadway and 11th Street, in the same neighborhood as Union Square Ventures and other local VC firms. Accel said it has more than 15 investments in the New York area including Quidsi, which was recently bought by Amazon for $ 540 million, Etsy, Venmo, Bonobos and others.
New York in general is hitting its stride with a number of start-ups getting funding. The latest numbers from CB Insights found that New York has supplanted Massachusetts as the second biggest market for Internet investments, with 165 Internet companies getting deals over the last five quarters compared to 113 in Massachusetts.
It’s also creating a Silicon Valley-like talent crunch and some concerns about overheating. New York still has a ways to go to become the next Silicon Valley. There still hasn’t been a huge stand-out performer like a Google to help build around. But as more investment dollars look toward New York, it may not be far off.
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