Keith Rabois has spent most of his 13-year career in venture capital associated with the former home of Khosla Ventures in Menlo Park, California. But that is changing. Speaking Thursday night at TechCrunch’s StrictlyVC event in New York’s West Village, Rabois confirmed that Khosla Ventures will open its first office off Sand Hill Road. The new outpost will be in New York, on 14th Street, and is expected to open this fall.
“Actually, it’s supposedly being built now,” said Rabois, who has clearly had to deal with one or two missed construction deadlines. “We’ll see. The fall opening date is very vague in my opinion.”
The move is notable in part because of how unusual it is specifically for Khosla Ventures. “We don’t even have an office in SF, so this is a big step for us,” Rabois said.
The office will house a handful of Khosla investors, including Rabois, but its most unusual feature is what he called an “executive briefing center.” That will be a space where the firm will bring together 10 or 12 portfolio companies at a time to meet with a Fortune 500 company, four days a week. “Portfolio companies love this,” he told attendees. “They get pilots and clients, so it will be a very vibrant office because of that.”
The announcement comes months after Rabois herself moved to the East Coast, to be closer to her husband, Jacob Helberg, the Under Secretary of State for Economic Growth, Energy and the Environment, and their children, who currently reside in Washington, DC.
That move prompted an obvious question from this editor: whether he thinks New York has the density of talent he’s spent his career recruiting in the Bay Area. He paused and then said it depends on seniority.
In the youth category, Rabois was unequivocal. “At the individual taxpayer level, fresh out of school, absolutely,” he said, pointing to Ramp, the fintech company he has repeatedly backed, as evidence. “We have been taking advantage of graduates fresh out of school and have been able to create a critical density of talent from the intern class. [onward] “That is extraordinary.”
Senior technical talent is a different story. “Senior engineers, architect level… no, I think it’s a challenge,” he said, adding: “Fortunately, perhaps in the modern era, fewer of these types of people are needed per company than historically.”
But the biggest problem for companies is talented top executives, Rabois said, explaining that it has less to do with supply than with geography and lifestyle. “If you have an office culture, most of the older people who live and reside in the New York area live outside the city, and the trip in and out of the city for an office environment can be very painful,” said Rabois, who grew up in a New York suburb. “We were like a 32-minute express train into the city, but many people live two concentric circles further away. When you need to recruit proven executive talent and you really believe in an office culture, [that has] “It has been a great challenge.”
Ramp’s solution, he said, has largely been to opt out of that problem entirely. “We don’t hire high-level people. We just build from the bottom up, from the ground up. It’s been a very conscious, very intentional strategy for the last three years,” he said. “That can work,” he continued. “But if you need a CFO, a senior vice president of sales, someone who has a lot of gravitas and experience, it’s really difficult to have them in the office five days a week, because unless they’re very independently wealthy, they really can’t afford to raise a family in the middle of the city.”
Khosla’s move puts him in a small but potentially growing club. Other major Bay Area venture firms have maintained a presence in New York for years, albeit a generally modest one. For example, Sequoia Capital and Andreessen Horowitz employ New York-based partners, although in comparatively small numbers relative to the Bay Area.
It also comes on the heels of a published report. last month by commercial real estate services firm CBRE which found that New York has narrowly surpassed the San Francisco Bay Area in total number of tech talent for the first time in the 13 years CBRE has tracked the data. This is largely because financial firms aggressively hire AI talent, while Bay Area tech employers cut staff.
Could it be a coincidence? Judging by the room Thursday night, many New Yorkers aren’t ready to believe the headline just yet.
“I heard about that study,” said one attendee. “I don’t believe it”.
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