First NY tech billionaire
NEW YORK: When you think of New York City’s burgeoning start- up scene, you might think of trendy social media companies like Foursquare or Tumblr or e-commerce sites like Gilt Groupe.
You might think of the Brooklyn-based start-ups that are helping to forge the new DIY economy, like MakerBot, Etsy and Kickstarter.
A couple of those start-ups – Tumblr and MakerBot – recently sold for huge sums. A couple of others could be in line for substantial initial public offerings (IPOs). But none, according to Bloomberg News, can lay claim to producing Silicon Alley’s first billionaire.
That honour, Bloomberg asserts, went to a far less flashy name: Shutterstock, the stock- photography site whose licensed images adorn millions of ads and hastily composed blog posts. The company went public in October and has seen its shares soar. Late last week, founder Jonathan Oringer’s 55 percent stake in the company was valued at $1 billion (R11bn). Citing RBC Capital Markets analyst Andre Sequin, Bloomberg declared Oringer “the first billionaire to be created in Silicon Alley”.
But how do we know Oringer is really the first? I called Sequin to find out. He told me he was a little surprised that Bloomberg had him making the claim quite so definitively. Sequin clarified to me that Oringer is the scene’s first billionaire founder “as far as I know”. He added that he “couldn’t come up with anyone else” who met the criteria: a New York tech or new-media start-up founder who owns enough of a company that his own share translates to $1bn or more upon exit (or on the stock market, if it has gone public).
So while Tumblr recently sold to Yahoo for $1.1bn – heralded as the city’s biggestever venture-backed start-up exit – Tumblr founder David Karp doesn’t qualify, because his stake in the company was only about 25 percent. Not that Karp isn’t plenty rich. But he’s not a billionaire.
Any other candidates?
Business Insider’s Nicholas Carlson, who knows the scene better than most, suggested via Twitter a name that is probably familiar to the Bloomberg reporters who wrote the piece: Michael Bloomberg himself. “Would you consider him tech?” Bloomberg’s Sarah Frier asked. “Yes,” said Carlson. “He built a private internet.” Fair enough – tech is an amorphous category in any case.
But as Carlson conceded, Bloomberg’s success story dates to an earlier era, before local tech publications sprouted up in the mid-1990s to coin the term and cover the local scene. On the other hand, some argue that the term Silicon Alley is itself outdated. Among them is venture capitalist Fred Wilson – who, come to think of it, might have a claim to the title himself, having achieved a reported net worth of over $1bn by investing in some of the city’s biggest success stories. But he’s a venture capitalist, not a founder, so it seems reasonable to exclude him and his ilk.
Until someone proves otherwise, then, Oringer’s claim to the title can probably stand. But how much longer will he remain alone in the billionaire’s club?
New York Tech Meetup’s list of “made in NY” start-ups boasts 592 companies and counting: Viggle, Vimeo, Vindico, Visual Revenue, Vivastream, Vixely, Voxel, and Voxy, to name just a few of the Vs.
Who knows if there’s a Google or Facebook among them – but it’s a good bet that there’s at least another Shutterstock. – Washington Post/Slate
Jon Olinger is worth more than $1 billion