Forget Silicon Valley; be Seattle
HOLMDEL — Jay Bhatti sat in the cavernous former Bell Labs building one morning this week and recalled his time as an intern at Microsoft, listening to Bill Gates.
Gates told the interns that he put down stakes in Seattle, where workers wouldn’t be distracted by the Silicon Valley frenzy and could focus on building something great. That’s what New Jersey should aim for, Bhatti said.
“I think the challenge for New Jersey always has been that given that New York City is so close, they compete so hard with New York City,” he said. “And they try to be too much like New York City. That’s the wrong thing for New Jersey to be.”
Bhatti could help reinvent the Shore. The 42-year-old Marlboro resident is a partner with BrandProject, a venture capital company that has offices in New York City, Toronto, Seattle and, soon, at Bell Works here.
And he represents a new generation that business leaders hope can help the local economy make the transition from one that could reliably depend on thousands of Bell Labs or Fort Monmouth workers toiling away in giant corporate campuses to one where dozens of smaller technology companies buzz with energy. One or two might even make it big.
Jay Bhatti of Marlboro, founder and CTO of BrandProject, says New Jersey needs to emulate Seattle’s role in the tech scene. (Photo: TANYA BREEN/STAFF PHOTOGRAPHER)
Right track for Bell Works
Bhatti’s office will be tucked away with enough room only for a desk and maybe a couch. It’s a drop in the bucket, considering Bell Works is 2 million square feet. But his presence is a sign the building’s renovation is on the right track, said Ralph Zucker, president of Somerset Development, which is redeveloping the facility.
“Jay has a history of being able to spot trends,” Zucker said. “It’s a small step, but it’s very significant to us. New Jersey has zoned itself into obsolescence. People don’t want to work in dead spaces. They want to be alive. They want to be inspired.”
Bhatti has a unique perspective. He was raised in Old Bridge, went to college at Rutgers University and then headed west to work at Microsoft. He moved to Silicon Valley to create Spock, a search engine, in 2006. He sold it three years later to Intelius, a company that does background checks. He declined to say for how much, other than it was enough that he didn’t have to work for a few years.
Bhatti and his wife, Harleen, moved back to New York City, and he scoped out Manhattan’s booming technology scene. When they had their daughter, Mira, a year ago, they decided to return to New Jersey to be close to family.
He was too young to retire. He couldn’t figure out another idea that would match his first one. So he decided to partner with three friends to start a venture capital company that not only would invest in startups, but also offer expertise to their owners. BrandProject has invested in a dozen companies from Utah to London so far.
Bhatti sat down with the Asbury Park Press and talked about how New Jersey can become not the next New York City or Silicon Valley, but Seattle. Or better yet, New Jersey.
Jay Bhatti’s BrandProject is opening an office in Bell Works, the Holmdel building once home to Bell Labs, (Photo: TANYA BREEN/STAFF PHOTOGRAPHER)
Where does New Jersey fit in the new economy?
I would differentiate New Jersey and New York like Silicon Valley and Seattle. Silicon Valley is a place where hundreds of startups are started every single year, maybe thousands. And it’s almost Darwinian. They are all fighting with each other for employees. … Seattle doesn’t have that necessarily. Seattle is more, like, a couple of guys will come together and say, “We want to build a business. We want to do something interesting.” And they will not stress about losing their employees to other people because there’s not as many early-stage startups launching every 10 minutes that are trying to steal from them with new funding and stuff like that. So what ends up happening in Seattle is you have time for companies to bake.
Even though Seattle claims not to have a great tech ecosystem, the number of billion-dollar companies that have come out of Seattle the last 20 years is more than New York City. … And the reason is because in Seattle, it’s almost like this distraction-free world, where people can have the time to grow and then become really big.
Bell Works in Holmdel, where Jay Bhatti of BrandProject is opening an office, is using its heritage as the former Bell Labs to attract new tech companies. (Photo: TANYA BREEN/STAFF PHOTOGRAPHER)
What ingredients does New Jersey need to make that happen?
When entrepreneurs would look at Jersey before, they’d say, “Oh, look, here’s a corporate park,” and they’d say, “Oh my God, it looks like I’m back at (Hewlett-Packard) or IBM in the cubicle nightmare. They don’t want to be there. They want to be in places like (Bell Works). So the more buildings that we can find in New Jersey that are older, but we could renovate to do something like this with and make them into modern spaces, the better we’ll attract founders. So things we do in Fort Monmouth. Things we do in Newark. Things we do over here. Will have a large impact in helping us get to that point.
The other part is a harder part. New Jersey is just historically an expensive place. The taxes are just stupid. There’s no way around it. The property taxes are high, the income taxes are high, the sales taxes are high, jeez, where does it end? Other states may have one or the other. New Jersey has them all. Unfortunately, you’d have to push this through government and I don’t know how successful it would be. I say to myself, “What could really get a founder motivated to be in New Jersey instead of New York City?” It’s very simple. … If you’re a startup that knocks it out of the ballpark and you (sell or go public) down the road, no capital-gains tax. The amount of entrepreneurs you get who will be very motivated to look at New Jersey will be huge.
Is there enough capital in New Jersey to attract startups?
Capital is actually not the problem. It’s the good ideas of the founding team that’s the problem. And for a good founding team, they need good infrastructure. … A lot of people say, “Oh, you need to be in Silicon Valley because all the (venture capitalists) are there.” No, the VC’s will give you money anywhere. The talent leaves here. That’s the challenge.
Michael L. Diamond; 732–643–4038; email@example.com
Bell Works, a multi use office/retail/hotel complex, located in the iconic Bell Labs building, is nearly ready for occupancy. The hard part will be attracting tenants to the 2 million square foot building. Video by Michael Diamond and Bob Bielk
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Originally published at www.app.com on February 4, 2016.