For Buffalo Niagara’s economy to grow, the area needs to create an environment that makes young innovators want to stay here, and it needs to reposition itself as part of a larger region that draws on the talent in the Syracuse, Rochester and Southern Ontario markets, a top New York City venture-capital investor said Tuesday in Buffalo.
And a few more food trucks wouldn’t hurt.
That was some of the advice offered by Fred Wilson, managing partner of Union Square Ventures, when he spoke at Larkin Square as part of the Feeding Innovation Series hosted by the technology incubator Z80 Labs.
“I think it’s just as important to have a community where young people want to stay, and be part of, than it is to have the jobs. It’s all got to be part of the same thing,” said Wilson, who was an early backer of Twitter, among numerous other investment successes and failures.
Wilson also talked about what he looks for when he’s deciding whether to invest in a startup and what anyone who is trying to develop the next big thing should keep in mind.
He answered questions from moderator Eric Reich, co-founder of Buffalo-based Campus Labs, and from an audience of more than 100. Two years ago, he spoke to a similar gathering of tech entrepreneurs and business leaders at the invitation of Z80 Labs founders Jordan Levy and Ron Schreiber.
At Tuesday’s session, Wilson said the food truck rodeo that Larkin Square was set to host later in the evening was the kind of attraction boasted by cities popular with the creative class.
“What do people want in life? They want to get a job. They want to meet a mate. They want to get married. They want to have kids. They want to raise a great family. They want to have financial success. If you can’t create an environment in a city like Buffalo where they can have all that, they’re not going to stay here,” Wilson said.
He added that Buffalo Niagara needs to rebrand itself within a broader swath of territory that includes its upstate New York neighbors and population centers across the border. After his talk, Wilson said that he believes deep-pocketed Western New York residents need to commit to making risky, early-stage investments to help local tech startups get to the point where Wilson and other out-of-town investors would be willing to get involved.
“If locals can get it far enough along, then the outside money will come in,” Wilson said.
He also said in the interview that he thought the 43North business competition is a good idea, even if none of the finalist companies becomes a grand success, because it put Buffalo “on the map.”
“Just for PR value alone, it’s worth every dollar they’ve spent,” Wilson said.
Highlights from his hour-long talk include:
• Wilson said he believes companies would be wise to get accepted into Z80 Labs or another incubator program – to take advantage of the support and validation that come with it – before obtaining seed funding, putting the finishing touches on a viable product and then seeking venture capital.
“That would be the perfect path if I had to pick one,” Wilson said.
• Wilson said he turned down a chance to invest in Airbnb, the home-sharing company that started with a simple idea and now is valued at $10 billion. “It was so simple that I didn’t get it. I literally passed on it because I was like, ‘Who would pay to sleep on someone’s couch?’ ” Wilson said.
But the company got early-stage funding, executed its simple idea and quickly grew to a size that allowed it to serve its customers and to fend off rivals, Wilson said.
• He said he only invests in certain companies, so that narrows the set of opportunities he is willing to consider. After that, he said, it comes down to feeling comfortable with the founders and taking a chance on the company and its product.
“Doing due diligence,” Wilson said, “can lead to the wrong answer.”