NYC vs SF: which is better for startups?

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NY vs. SF: the battle rages on

While you can argue the cultural controversies over which city is friendlier to gays or which has the best Chinese food, there’s one thing those left coasters have us beat on, according to biz blog Focus. The site breaks down (in a huge infographic) the costs of launching a start-up in each city, finding SF to be the cheaper choice. If you’re starting a business in New York, you can expect to fork over at least $70 more a month for utilities and about $10,000 more in annual taxes. But numbers never tell the whole story: Software engineers and designers of Brooklyn, are they right? Is SF really cheaper? What about the less tangible differences such as a scrappy Gotham ‘tude versus head-in-the-clouds granola zen? And dirt-cheap, kick-ass pizza? For all those late-night coding sessions, this might be priceless.

The square foot cost of office space, from the Focus study.

Focus shows that while San Francisco companies spend more on employee salaries — an average $10,000 more for common start-up positions — The Big Apple will end up squeezing $75,000 more a year out of your pockets to rent out that snazzy office space, not to mention more than $4,000 to cover utility costs here. No indication of what stereo speakers and ping pong tables cost across the two coasts, but we’ll wager bets on the East Coast’s superior streetside finds. Those of you who chose NYC over SF for your business, what swayed your decision?

Follow Karina: @Karinabthatsme.

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  1. rent aside, I’ve heard SF is more expensive because there just isn’t enough to DO there. Like you can eat a hundred different cheap ethnic places from Greenpoint to Bay Ridge, but SF doesn’t have that. 

  2. Cost really depends on what you believe as a company is required to launch an minimum viable product. Who says that you (as a start up) HAVE TO rent an office space, and considering a lot of start-ups don’t register their business licenses in the state of New York (the first start-up I worked at was based in the Fashion District and registered as a California LLC), there are loopholes.

    A Couple other notes:

    – Renting an apartment in SF is fairly comparable to NYC. If you’re willing to live outside of SF (Oakland, Berkeley, etc). you may save money.
    – A car is pretty much required to travel around California which is also accompanied by less than nominal costs like Gas and Insurance

    • Additionally, though SF tends to have a higher saturation of capable web creatives (designers, engineering, etc)… being in NYC generally affords you better access to media outlets, investors and a localized user-base that is more accessible for testing and receiving feedback.

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