The Lighter Side, and a Touch of Shadow, in New York’s Tech Scene

[Corrected 5/25/14 6:30 pm, See below.]

It has been a celebratory few days here as another Internet Week New York fades into memory.

Mayor Bill de Blasio essentially asked local innovators to collaborate with his administration to further the city’s growth. And there was plenty of revelry among the who’s who of New York techies. However, amid the bubbles of champagne and fervent speeches about the local technology community, there was a stark reminder that growing a startup remains an arduous journey.

Internet Week New York is an annual gathering of technologists, entrepreneurs, and looky-loos (myself included) curious to see what bright ideas are being cooked up in the city. By day, there were presentations from the likes of Aereo CEO Chet Kanojia, who was talking up ambitious plans despite his legal battles. Come nightfall, Richard Blakeley’s perennial Webutante Ball brought out notable faces such as Jessica Lawrence, executive director of New York Tech Meetup, as well as tech writer and entrepreneur Seth Porges.

[A previous version of this story misidentified the host for the reception as the magazine Time rather than Time Inc.] On Wednesday night, Time Inc., the publisher of Time, held a gathering for its 10 NYC Startups to Watch, which included a few familiar names. One of the honorees, Maker’s Row, is an online marketplace that connects small businesses with domestic manufacturers. Co-founder Matthew Burnett chatted with me about his team’s growth from three to 10 and expansion into new categories. “We’ve gone from apparel to furniture,” he said. “We plan on launching a number of other verticals in 2014.”

Matthew Burnett hopes Maker's Row can emulate Alibaba but for U.S.-based manufacturers.

Matthew Burnett hopes Maker’s Row can emulate Alibaba, but for U.S.-based manufacturers.

Manufacturing and the so-called maker movement have been enjoying a bit of a mini-renaissance lately as innovators try their hands at making real-world products. “We’re seeing a lot young people buying American factories,” Burnett said. As some generationally owned factories go out of business, he said new players are stepping up. “I attribute that to the maker movement,” he said.

Maker’s Row wants to be part of that trend and emulate the rise of a well-known business-to-business portal. “Much like Alibaba opened up the gates to small businesses in the east, we want to do that in the United States,” Burnett said.

Cover, which developed an app for splitting the bill when dining out with friends, was also picked by Time Inc. as a Startup to Watch. Mark Egerman, co-founder of Cover, said more than 100 restaurants are on board with letting patrons use the app to pay their checks. Furthermore, Cover announced on Wednesday its availability in San Francisco. “Our goal is to become a normal part of the restaurant experience,” Egerman said, “just like using a credit card.”

The other startups chosen this year by Time Inc. were Flatiron Health, GlamSquad, Hatch, Niche, Placemeter, Retoy, Strolby, and Venmo.

Juxtaposed with such festivities, however, came reports that the struggles at Fab were far from over. According to Re/code, the e-retailer laid off up to 90 employees at its New York headquarters. That comprises about one-third of the company’s worldwide staff.

Back in 2011, Fab shot to the forefront of New York’s tech scene as a place to find designer wares. After some acquisitions, expansions, and a shift to sell its own products, the company suffered a series of layoffs and questions about what its long game.

A statement from Fab, posted by The Wall Street Journal, said the company is “realigning” per a plan it started “last fall and which will continue to unfold in the weeks ahead.” Whichever way this shakes out, it’s a sobering reminder for New York startups that building a business on the Web, and beyond, can mean hard stumbles along the way.

Trending on Xconomy