New York City has a myriad of nicknames, The Big Apple; The Capital of the World; The City So Nice, They Named It Twice; The City That Never Sleeps; The Empire State—and perhaps most relevant, The City of Dreams. New York is buzzing with new startups, and the world is beginning to take notice. Typically overshadowed by San Jose, the hub of Silicon Valley, New York City has finally overtaken their no.1 spot. Recently named the “top city to open a small business in America” by CNBC, this metropolitan area is seeing an influx of aspiring entrepreneurs hoping to ‘make it big.’ According to the U.S. Small Business Administration, there are more than two million small businesses in NY State, which make up roughly 99.8% of all companies in the area and more than half the region’s workforce. So, what makes New York a magnet for startups? Perhaps it is a combination of the city’s booming real estate market, its multitude of industries, strong banking and tourism, a diverse population, tight-knit business network, and impressive source of seed capital.
New York is one of the best cities in the world to start a business,” said investor and developer Yair Levy, who owns real estate in New York and Miami. “New York has an energy that is hard to find in other cities. If you work hard, dream big and don’t give up, then you can become very successful. When I came from Israel to New York in the early 1970s, I never imaged I would be selling my fashion line to some of the world’s largest department stores in New York. And when I transitioned from the fashion industry to real estate in the early 2000s, I was able to become one of the most prolific real estate investors and developers in Manhattan because I had big dreams.”
At the moment, New York is home to many entrepreneurs who built success on past failures. Some New York City-based startups boasting unique product and service offerings that you may recognize are: Etsy, Blue Apron, Codeacademy, Citizen App, Venmo, and Digital Ocean—to name a few. While remaining humble regarding his accomplishments, Yair has his own success story. When Yair was only twenty-two, he came to the US with the dream of a brighter future. After just one year, he had created a fashion line and was selling his designs to the country’s leading department stores, including the renowned Bloomingdales. However, by 1997, Yair had developed an interest in real estate and began procuring strategically located properties for redevelopment in Manhattan. Today, Yair is an advisor to New York-based Time Century Holdings LLC, a family trustee with a focus on development sites and retail properties. Today, he shares invaluable information that will help you start your own business.
1. Follow Your Passion
Successful entrepreneurs are passionate about a particular product or industry. In his case, Yair learned about fashion from his mother’s experience in that field and learned about real estate from his father. By combining those experiences with creativity, he found success in New York. After arriving in New York City, Yair quickly discovered gaps in the retail fashion market he felt capable of filling—and it wasn’t before long that he found success on a national and international level. Yair’s achievements in the fashion industry demonstrate the importance of differentiating your product or service from competing firms by tapping into customer needs. Additionally, the more invested you are in your business concept, the harder you will work to ensure that it thrives. As with all start-ups, you will inevitably face some hiccups along the road, so having a strong personal connection to your mission will increase your odds of success. If you need help finding inspiration, try searching the Internet for trending industries to see if there is a field that aligns with your individual goals, interests and natural abilities. He later focused his passion in the NYC real estate market. For the last 20 years, Yair and his family trust have been involved in acquisitions, dispositions, and development sites that have generated strong rates of returns. Throughout his real estate career, he has maximized the value of some of New York City’s most valuable properties, including The Sheffield 57 at 322 West 57th Street, 620 Sixth Avenue and many other buildings.
2. Develop a Business Plan
Once you’ve got a great business idea, the next logical step is to draft a plan that will help you reach your goals. While some people choose to opt-out of strategic planning, Yair advises against this. As a real estate investor, he aims to optimize his revenue, which is next to impossible without research. A typical business plan includes four broad categories: product development, sales and marketing, people and partnerships, and financial planning. By drafting a proposal, entrepreneurs can pinpoint flaws in their strategy and mitigate risks before they occur. As previously mentioned, product development refers to creating a unique good or service. For instance, your product might be the first of its kind or the only sustainable option on the market. Moreover, sales and marketing involve identifying your target audience and the steps needed to convert them into paying customers. Sound like a lot of work? That’s why you can’t do it alone. Your proposal should outline the specialized talent and professional relationships required to execute your plan. Finally, determine the amount of funding needed to get your business off the ground and consider various methods of funding.
3. Speak To A Lawyer
The New York City Small Business Services (NYC SBS) lends a helping hand to new businesses starting from inception. “First and foremost, owners need to choose a legal business form,” explains Yair. New entrepreneurs without a business background may have a difficult time determining the best structure for their firm. Fortunately, the NYC SBS offers free consultations with an attorney to help individuals decide on an ideal structure. In general, Yair says to avoid starting your company as a “sole proprietorship.” As a sole proprietor, the owner is responsible for all business debts and obligations, potentially putting their livelihood at risk if the business goes under. Consequently, entrepreneurs will usually start their business as an S Corporation, C Corporation, or limited liability company (LLC). Yair typically suggests forming as an S Corporation, which receives beneficial tax treatment, and the opportunity to convert to a C Corporation in the future. However, the best strategy for your business will depend on your particular industry, which can be determined by speaking to a qualified legal professional.
4. Obtain Permits and Licensing
Unless you want to run into legal troubles down the road, make sure you have all the necessary permits and licenses needed to operate your business. Overall, you need to make sure that you are complying with federal, state, and local government regulations. Working in the real estate investment industry, Yair understands the importance of applying for the correct permits. In his line of work, “The Department of Buildings reviews construction plans to ensure that they conform to the building codes and meet present safety standards and zoning requirements,” Yair explains. If you are uncertain about the requirements your business needs, you’re in luck because the NYS Business Wizard will provide you with a customized list of permits you may need to get your business up and running.
5. Apply for Financing
Nothing can cripple your business plans quicker than a lack of adequate funding. To avoid this pitfall, Yair suggests that entrepreneurs start working on an elevator pitch if they are considering outside capital. An elevator pitch is essentially a concise and persuasive speech used to spark interest in yourself or your organization—and as the name entails—it should be twenty to thirty seconds long, no longer than an elevator ride. Yair reminds us that it’s critical to know your audience as well as their endgame. Two popular types of investors include angel or seed investors and venture capitalists. The first category, angels, are known to assist firms in the earliest stages of business before demonstrating revenue. In contrast, venture capitalists are more interested in a proven business model or a firm that exhibits high growth potential in a relatively short period. Not all investors are created equally, so it’s necessary to do your research when evaluating funding options in New York City.
6. Scout for Talent
With a population of over 8 million, NYC is the most populous city in the United States, more than double the size of the next largest city, Los Angeles. As one might predict, larger regions have a deeper and more diverse talent pool. New York, in particular, has a massive student population as the city is home to some of the most prestigious colleges and universities in the world, like Cornell, NYU, Columbia, Yeshiva, and Fordham—and many others. Appropriately, it makes sense that over one-third of the population 25 years and older hold a bachelor’s degree or higher, in contrast to 30% nationally. “The city is full of bright-minded and ambitious individuals who are willing to work hard,” shares Yair, from his personal experiences with recruitment. At the same time, NYC is very diverse, with an astounding 3 million NYC residents being foreign-born. There are many advantages to a diverse workforce, including enhanced productivity, higher profits, greater employee engagement, lower employee turnover, more cultural insights, a wide range of skills, and improved company reputation. As a result, the chance of finding diverse, talented individuals that align with your brand's mission is promising here in NYC.
Starting a business in New York, or anywhere for that matter, can be a daunting task. However, there are some major advantages to launching your brand in The City of Dreams. As Yair mentioned, greater access to resources, a talented population, and large professional networks are just a few of the reasons why aspiring entrepreneurs flock to this amazing city.
This article does not necessarily reflect the opinions of the editors or management of EconoTimes