Building in the City

“If you can choose one thing, choose growth.” - Dan Gilbert

I recently sat down for lunch with an elected official here in New York City. He asked me, “How is it raising a family and running a company in the City?” He was fishing for information on what business founders and parents are experiencing and what the city could be doing better.

“It’s fine,” I answered. “Most of my team is based here in New York and I’m not going anywhere.” He seemed a little bit relieved at my answer.

For me, it was an easy choice to start Noble Mobile in New York because, well, I live here already and so did my co-founders. My kids are in schools that they enjoy, in grades 8 and 4, and you try not to have your kids switch schools unless there’s a very compelling reason. Are my rent and taxes and cost-of-living higher than normal? Sure. But I’m in building mode and this is a fine place to build. I’m at a point where my choices revolve as much around my personal preferences or family priorities as optimizing for the last dollar.

There are a lot of advantages to building a company in New York. You have access to talented engineers and hires. You can establish a cohesive company culture that’s industrious and creative. It’s easy to meet with brands, celebrities, agencies, investors, media outlets and corporate partners. I go on CNBC or CNN or Fox or some other news network every week or so and it’s a short ride to a studio. Even podcasters are more likely to be either based in New York or visit.

The downsides of starting a company in New York City are primarily costs: everything is very expensive. This includes taxes, rent, employee compensation, food, healthcare, cleaning, you name it. Whatever a normal company might budget for, say, a company lunch, you can add 30 - 50% to it. We are based in the Garment District, which is highly convenient for travelers but kind of a no-frills neighborhood, partially to save money on rent.

We employ some young people at Noble Mobile. I think a lot about some recent college graduate arriving in New York the way I did back in 1996. (I graduated from college 30 years ago and am going to my reunion next week!) I was a random twenty-something-year-old wannabe entrepreneur trying to make something of myself. My rent was $1,080 to split an apartment with a friend. I walked or took the subway everywhere – a cab was an emergency measure. I would bring a book to read on the subway. I was in New York to try to access opportunities and meet people; I was the idealistic young hire who took a paycut at a small company hoping to achieve something. My parents lived in the suburbs, so I could take the train home for a nice meal during a weekend or holiday, but they moved away when I was in my mid-twenties.

The opportunities were both professional and personal; New York City had a great dating scene for twenty-somethings. I would go out late at night to an acquaintance’s birthday party in the hopes of meeting someone and having sparks fly, and even if the night ended in disappointment, the late-night subway ride home felt like the end of a quest that would start again the following day or weekend. During my twenties, I moonlighted as a part-time tutor and nightclub promoter while working at various start-ups.

For me, my big break came when the little education company I tutored at needed a new CEO in 2005. I became the CEO a year later, the same year I met Evelyn. When that company was acquired 4 years later, I became a millionaire. I paid off my law school loans and all of my youthful misadventures were wiped clean. I was 34 at the time, and married Evelyn two years later.

I would never have had this kind of journey any place other than New York. It was a pressure cooker that took me from a failed entrepreneur to a guy with three jobs to eventually a successful CEO in the space of 12 years.

I’m not sure if the New York equation still works as well for young people. There’s evidence that it doesn’t. My tiny bedroom in that apartment would cost $2,600 today as opposed to the $1,080 I spent in 2000. There aren’t as many growth opportunities where your compensation goes up at a rate that exceeds your cost-of-living. A lot of people live here for a few years and then depart because they can’t afford it. The fact that I’m still in the city as a middle-aged Dad is a mild shock, as I used to regard surviving here as a victory in itself. I pay for things that I never would have imagined when I was younger, like parking and food delivery and dry cleaning. Most of the people I came up with in my twenties have long since left New York City, if only to New Jersey or Long Island or Connecticut to raise a family.

I talk to business leaders and hear that big companies are starting to shrink their footprints in the city in favor of places like Texas and Florida. New York and California are right now the states experiencing the most out-migration; that is, people are departing mainly because they’re too expensive:

Would I tell a young person today to move to the City for their twenties out of school? Of course it’s not for everyone – no place is. It’s a deeply individual decision, and people will do what’s inside of them. I would say it’s a great place for the sense of energy and to experience a special time of one’s life. If you’re fortunate, you can become a bit like Liam Neeson in Taken, and develop ‘a special set of skills’ that might serve you well wherever you go. But I would also say that the New York of the late 90s and early 2000s I came into my own in has gotten pricier and less welcoming. It’d be good to set a clear sense of goals and a timeline for yourself, because, like a lot of the country, it’s gotten tougher over time for the folks showing up here with a dream.

For a limited time only you can get 6 months off your mobile bill with Noble Mobile, an absolutely crazy value that will save the average family $1,000. You read that right. Email matt@noblemobile.com and use my name to switch or explore. Offline no-phones party returns to NYC on May 21^st! I’m going from that party to my college reunion. Look up.