On the one hand, the city of New York, led by a mayor with a proven track record of entrepreneurial success, pushes the startup agenda with a bold agenda of building on its #2 status in the U.S. and possibly overtaking Silicon Valley as the hot bed of startup success.
Last month, John Battelle and Brian Monahan’s OpenCo. Initiative rolled out in the city, with Robert K. Steel, Deputy Mayor for Economic Development, espousing NYC’s startup surge and Rachel Sterne Hoat, the City’s Chief Digital Officer, doing likewise.
However as the one hand giveth, the other taketh away, with a judge ruling two weeks ago that airbnb violates NYC’s “hotel law.” This ruling is the third in quick succession, joining the likes of RelayRides and Sidecar on the sharing “sidelines.” These rulings continue to throw obstacles in the path of startups whose time has come. Treating hosts as common criminals and scaring off potential visitors is not exactly the best way to say, "I Heart NY," is it?
There’s a hashtag to voice disapproval with @mikebloomberg to stand up and #defendsharing.
So what is going on here?
Let’s start with the “micro” part of the discussion. New York might be the greatest city in the world, but it is also grounded in so many legacy and incumbent processes, many of which are broken; ingrained and traditional unions and associations; and archaic systems that cannot be serviced by the tenured organizations that watch over them.
All this dysfunction effectively translates into fear of the unknown, of the new and exciting startups that are turning traditional business models on their head, disrupting the status quo and rewriting the rules as they go along. That’s beyond scary to the establishment, but it shouldn’t mean pushing back and delaying the inevitable.
And it certainly doesn’t mean fining Airbnb hosts $2,400 and making them feel like common criminals -- or at the very minimum, Napster users.
Or take Uber, the incredible connection engine between commuters, car services and cabs, which is undergoing similar pushback from the city. A month ago, no doubt influenced by -- surprise, surprise -- the Taxi & Limousine Commission, a judge blocked an order that would have allowed Uber, temporarily suspended, to once again do business in the city. In other words, you're back at square one when you can’t find a yellow taxi when you need one!
Make up your mind, NYC. If startups are welcome in the Big Apple, then you have to be prepared to support their ability to do business -- otherwise, what’s the point?
The very nature of the startup is to challenge an inefficient business model, solve a problem or address an unmet need. Oftentimes, the solution might sting a little. The truth hurts, but as we’ve learnt the hard way too many times now with businesses and business models crumbling due to lack of innovation, progress and evolution, it’s better to deal with it now, compared to denying it altogether, hoping it goes away or delaying the inevitable.
The second implication is that startups may look elsewhere for their “home” if the city does not support them beyond tax breaks, shared workspaces and less red tape. Charity begins at home. IF the city extends a hand, but then slaps us across the face with it, our welcome seems short-lived and far from authentic.
On the macro level, this is bigger than New York City. There’s a story about the sharing economy and the natural level of discomfort that it brings to the table. It is extremely unique and highly disruptive. And of course the common thread of the old guard pushing back until eventually the sea of change becomes a crushing tidal wave.None of this needs to happen. To use one more popular saying, “If you can’t beat ‘em, join ‘em.” I for one welcome the day where I can actually catch a cab at 4 p.m., avoid paying $800 for a matchbox at the W Hotel, or get from A to B without worrying about alternate-side-of-the-street parking!