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ASKED & ANSWERED How diverse perspectives inform equitable health care

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READY, SET, PITCH Jogging club lets tech founders get advice and exercise PAGE 3

FEBRUARY 14, 2022

BLACK WOMEN TALK TECH’S Gwynn and Ighodaro-Johnson seek to help entrepreneurs after facing their own frustrations accessing capital.

TRANSPORTATION

MTA reduces fares to encourage commuters Subway, LIRR and Metro-North riders will see caps, discounts BY BRIAN PASCUS

co-founder Abbey Wemimo’s experience moving with his family from Nigeria to Minnesota in 2009. As an immigrant with no credit history, his mother had little option but to take a loan at 400% interest to cover bills as the family settled in. Almost a decade later, Wemimo co-founded Esusu with Samir Goel, a first-generation Indian American. The duo hoped to use their financial-industry experience to build a startup that

he Metropolitan Transportation Authority announced new fare reductions for the city’s subway system and commuter rails in a sweeping gambit to lure back riders. As flexible work-from-home policies become increasingly popular, the MTA is rolling out four temporary fare reduction programs: placing weekly fare caps on One Metro New York transit tickets and adding three discounts to riders on the Metro-North and the Long IsPERCENTAGE land Rail Road. subway ridership The pilot prowas down Jan. grams begin lat31–Feb. 4 as er this month compared to and will last at prepandemic least through June. Transportation experts say the fare cuts could entice commuters back to a system that has experienced sagging ridership. MTA ridership was roughly 50% of its comparable prepandemic daily rate during the Jan. 31–Feb. 4 workweek. Long Island Rail Road and Metro-North numbers were even worse, averaging 45% and 40%, respectively, in the same five-day period. “People’s commutes have changed. They may be only going into the office two days per week or three days per week,” said Lisa Daglian, executive director of the Permanent Citizens Advisory

See FUNDING on page 19

See FARES on page 17

50%

INSIDE Most active venture capital firms PAGE 12

BUCK ENNIS

Four local tech unicorns with a Black founder PAGE 19

ENTREPRENEURSHIP

A BIGGER PIECE OF THE PIE

BY RYAN DEFFENBAUGH New York City–based arlem-based Esusu has reached the rarBlack startup founders efied air of technology startup unicorn, a company with a private valuation of raised $783 million $1 billion or higher. But along the way, last year, but that was it faced hundreds of rejections seeking capital, forcing a financial gamble from its founders. The four-year-old startup allows renters to still just 1.7% of the build their credit score when they pay landlords total funding available on time. The business is inspired in part by

NEWSPAPER

VOL. 38, NO. 6

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SPOTLIGHT

WHO OWNS THE BLOCK

FIRM GROWS ITS B2B AND E-COMMERCE PROSPECTS

Developers flock to Flushing

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POLITICS

More than a month into his mayoralty, Adams has yet to fill important city leadership positions

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I CRAIN’S POWER BREAKFAST: GREGORY RUSS Gregory Russ, chair and CEO of the New York City Housing Authority, will be interviewed live on stage by Crain’s New York Business Editor-in-Chief Cory Schouten about the strategies, action plans, goals, trends and improvements coming to the city to combat the current housing crisis.

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Too slow?

mayor for housing and economic development in the de Blasio administration and former CEO of the Economic Development Corp. “I’m sure they’re still getting their bearings.” ADAMS

The Adams administration denied the mayor has been slow or negligent in city appointments. “Mayor Adams is appointing the best people for the best jobs in the best city in the world,” said Jonah Allen, the mayor’s press secretary. “He has already announced several groundbreaking appointments and will continue in the weeks and months ahead to build a stellar team that looks like the city it serves.” Others argue that Adams has moved at a pace that’s no different than prior administrations. “Am I worried about where we are 41 days into a 1,500-day term? No. I’m much more concerned how everyone is performing five months into the term than five weeks in,” said James Patchett, former chief of staff to the deputy

Being careful Veterans of Michael Bloomberg’s administration were among the strongest defenders of Adams’ early days. “I think they’re being very careful about vetting,” said Peter Madonia, former chief of staff to Bloomberg at City Hall. “They’d rather be slow and deliberate than cause other problems by not being slow and deliberate.” Madonia noted that when Bloomberg won office in November 2001, his team needed to work 18-hour days through the middle of January just to finish interviews with prospective candidates for leadership positions. He pointed out that it took “well into March” 2002 to appoint commissioners to the Department of Buildings and the Department of Environmental Protection. He added that Bloomberg sometimes deliberately left open leadership positions on

boards and commissions until the City Hall offices were fully staffed. “We had a ton of positions on boards and commissions empty, and we didn’t even deal with that stuff until we had our City Hall and commissioners in place,” Madonia said. “You want your commissioners [to be] part of the selection process on boards and commissions that are important.” Mitchell Moss, an urban policy professor at New York University and a former adviser to Bloomberg, echoed Madonia and said the slow pace of Adams’ appointments is a sign of how careful the mayor is being in his selections. “The most intelligent decision is to prevent a mistake,” he said. “This is no time for a rookie amateur.” To this point, Moss emphasized that Adams’ patience in filling the Department of Sanitation and keeping acting Commissioner Edward Grayson in place during the winter season reflects this understanding. “The greatest mistake would be to put in a new person before the snow’s over,” he said. “You never change a sanitation commissioner until the spring. This is no job for someone who hasn’t managed 10,000 workers before and is just looking to build their résumé.” ■

As the City Council weighs options, this year may be the last for outdoor dining sheds BY CARA EISENPRESS

APRIL 6

raised about them, it’s hard to count how many nominees have been cited for their ethics,” said Neidhardt, who went so far as to call the multiple openings in agencies and offices “an abrogation of service.”

n the future, restaurants that want outdoor seating will likely have to leave 8 feet of sidewalk clearance for passersby, keep the walls to a maximum of 3 feet high and pay between $525 and $1,050 for a license. As the city’s restaurants gear up for warm weather during the last season of the temporary outdoor dining program, more details about the permanent al fresco plan took shape last Tuesday at an open hearing of the New York City Council. The hearing was specifically about a proposal that would alter the New York City charter and the administrative code around sidewalk and roadway cafés and the areas where they’re permitted. If enacted, the proposal would mean that most of the structures built in the past two years, often at high cost to the owners, will not survive into 2023. The proposal would not permit enclosed cafés in any areas where they did not exist before March 16, 2020. Instead, owners would be able to create dining areas on sidewalks and roadways, provided the areas

meet strict metrics that allow for accessibility for pedestrians and vehicles. The possible future of outdoor dining, it turns out, looks a lot more like the existing sidewalk café program, just open to many more operators. “By expanding the program to restaurants in all parts of the city and providing a new roadway seating option, the program will particularly help businesses in low-income neighborhoods and communities of color,” said Ydanis Rodriguez, commissioner of the city Department of Transportation. Before 2020 there were 1,200 restaurants with outdoor seats in the city because of zoning that restricted which neighborhoods allowed them. By the summer of 2021, there were 11,000. The city assured communities that even if this proposal—or an edited version—passed the City Council, it would not take effect until both the design and the Department of Transportation administrative oversight of the program were in place. “We want everything adopted together,” said Carolyn Grossman Meagher, director of regional plan-

ning at the Department of City Planning.

Key program The Open Restaurants program started as an emergency measure to allow for dining while restaurants were closed in 2020. Over time, Open Restaurants has become instrumental to eateries’ bottom line, even in winter. “Many people are still not comfortable indoors,” said Elizabeth Blouin, a general manager at Sarabeth’s. She said that the recent surge of the omicron variant knocked back her location’s progress toward normal, and outdoor seats would likely continue to be essential to sales for some time. Nine in 10 restaurants say the outdoor dining program is “very important” to the future of their business, according to data the New York City Hospitality Alliance collected from 726 owners and operators of restaurants in the five

FRESCO BY SCOTTO

ayor Eric Adams has made “getting stuff done” the trademark of his nascent administration, but more than five weeks in, Adams has yet to fill key city leadership positions, and many departments and offices have only acting leaders. Commissioner posts at the Department of Buildings, the Fire Department and the Department of Sanitation remain vacant, as do important business liaison roles such as director of the mayor’s Office of Minority- and Women-owned Business Enterprises and CEO and president of the Economic Development Corp. Adams, who in July was generally presumed to be the next mayor, is still sifting through résumés in February. “They convened committees and were supposedly doing the work, but it’s clearly shown that they weren’t working on the transition for those six months,” said Bill Neidhardt, a top aide to former Mayor Bill de Blasio. “It looks like he spent more time in Monaco and the club than seemingly running the city.” Neidhardt was referring to Adams’ two vacations, to Europe and

Africa, since the election. Other veterans of city government are calling attention to the pace and some high-profile openings. “It’s slow and hopefully it’s thorough,” said Charles Moerdler, a former commissioner of housing and buildings under Mayor John Lindsay. “The Department of Buildings isn’t filled, and it needs to get filled with a new commissioner. There are real problems with that department.” Adams’ initial pick to head the Economic Development Corp., Carlo Scissura, president and CEO of the New York Building Congress, will not take the helm after all. Scissura’s appointment became clouded by a report in The City that he did work as a lobbyist without registering. The mayor also received criticism from government ethics groups for his early appointment of Philip Banks, an unindicted co-conspirator in an FBI corruption investigation in 2014, as deputy mayor of public safety. Charges of nepotism dogged Adams after he appointed his brother, Bernard Adams, to lead the mayor’s security detail. “These are really high-level positions and to have ethical questions

BLOOMBERG

BY BRIAN PASCUS

boroughs. Opponents include residents of neighborhoods with a large number of restaurants, who say that outdoor structures have made sidewalks impassable, rats prevalent and drug users welcome. A group of residents has sued the city over the continuation of outdoor dining. The city had filed a motion to dismiss the lawsuit, but just before the hearing, a Supreme Court justice allowed it to move forward. The city is asking for residents and business owners to take a survey at nycdotsurveys.info/survey/ open-restaurants-survey. ■

Vol. 38, No. 6, February 14, 2022—Crain’s New York Business (ISSN 8756-789X) is published weekly, except for no issue on 1/3/22, 7/4/22, 7/18/22, 8/1/22, 8/15/22, 8/29/22, 11/28/22 and the last issue in December. Crain Communications Inc., 685 Third Ave., New York, NY 10017. Periodicals postage paid at New York, NY, and additional mailing offices. Postmaster: Send address changes to: Crain’s New York Business, Circulation Department, PO Box 433279, Palm Coast, FL 32143-9681. For subscriber service: call 877-824-9379; fax 313-446-6777. $140.00 per year. (GST No. 13676-0444-RT) ©Entire contents copyright 2022 by Crain Communications Inc. All rights reserved.

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TECHNOLOGY

BUCK ENNIS

PITCH AND RUN’S regulars maintain a pace just slow enough to allow for conversation.

A running start Local jogging club lets tech founders get in a workout while gleaning advice on their startup pitch BY RYAN DEFFENBAUGH

t’s a new form of sweat equity. For nearly three years now, local jogging club Pitch and Run NYC has offered startup founders in the city a chance to talk about their business in person, getting a workout along the Hudson River on the way. Tech industry investment has stayed productive even in the remote-work era of the pandemic—with local startups raising a record $55 billion last year. But the club offers an example of how the industry still values getting together and has found ways to continue doing so. This Crain’s reporter bundled up on a recent frigid Monday morning to tag along for part of the 4-mile loop along the

Hudson River Greenway. The group meets at 9 a.m. every Monday, Wednesday and Friday, promoted on the Pitch and

“HEY, LET’S GET OUT OF THE FOUR WALLS OF A CONFERENCE ROOM AND GET SOME EXERCISE” Run NYC Twitter account. And what is Pitch and Run’s pitch? “Stay connected to humans in a pandemic (and pitch your biz!) … all welcome!”

Before the run, there’s a round of fist bumps and introductions for the group of about a dozen at the Bluestone Lane Café in Chelsea Piers. Nihal Mehta, a co-founder of Pitch and Run, explained that there’s a core group of a half-dozen investors and professionals that participate each time, mixing in with people new to the city’s tech scene, startup founders with a business to pitch and out-of-towners looking to meet fellow techies. The outdoor meetups offered ideal conditions for networking in the age of Covid-19, especially in the early months of the pandemic, when most indoor socializing was off-limits. But the club predates Covid. See PITCH on page 22 FEBRUARY 14, 2022 | CRAIN’S NEW YORK BUSINESS | 3

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WHO OWNS THE BLOCK

148-09 NORTHERN BLVD.

Developers flock to Greater Flushing, updating older buildings and appealing to Asian buyers One is a 1928 Italianate with working fireplaces in most units BY C. J. HUGHES

147-25 NORTHERN BLVD. 35-33 147TH ST. Many of the new apartment buildings are lined with stores, although not with the old guard such as this 4-story, 38unit rental from 1924. The owner of the barbell-shaped building is Pinnacle Group, which paid $4.75 million for it in 2006 amid a wave of buying completed by the firm in the outer boroughs. But Pinnacle’s stewardship of some buildings has been rough, critics say. In 2011 the company settled a class-action lawsuit brought by tenants who accused Pinnacle of charging illegally high rents for rent-regulated units. For its part, Pinnacle said it had settled the case to avoid the costs of a trial. The firm had no comment. A one-bedroom unit at No. 33-35 leased for $1,767 a month in December, StreetEasy said.

Although the street may appear to passersby as mostly commercial, some blocks have had apartment buildings for decades such as this red-brick L-shaped residence. The 6-story, 145-unit rental building, constructed in 1960, is owned by a limited liability corporation controlled by Show Lain Cheng, who owns several large rental properties in the area. The building, which has rent-regulated tenants, had a few dozen open violations in early February, including problems with fire escapes and fire doors. But the landlord is not required to fix some of the problems for months, the city Department of Housing Preservation and Development said. In 2017 Cheng refinanced mortgages at the building with a $20 million loan from Ridgewood Savings Bank, records show. Attempts to reach Cheng were unsuccessful.

148-09 NORTHERN BLVD. In the mid-2000s the developer RockFarmer Properties decided to turn a rental building it had owned for years into a condo, with a target sellout of $37 million, records show. Some apartments were renovated and marketed as they turned over, although other tenants remained. But RockFarmer sold only about two-dozen apartments. Glacier grabbed the unsold units, including some with remaining renters, for $23 million during the spring of 2021. The project, now called Northern Lights, offers studios to four-bedroom units. Three apartments have been sold since the fall. “But we inherited those from RockFarmer, and they were already half-renovated,” Glacier managing partner Myles Horn said. “The apartments for sale now are all ours.”

146-17 NORTHERN BLVD. This site, once occupied with a low-slung retail building like the rest of the block, is now home to a 7-story, 38,000-square-foot building that has 33 condos, stores and community space. The condo, called the Northern, began sales last year, records show, although closings have not begun. Apartments feature blonde wood floors, tall windows, and washers and dryers. Prices start at $416,000 for one-bedroom units, according to online listings, or just under $1,000 per square foot. Property taxes are abated. Owner Jae Won Chang and partners sold the site to a Flushing-based limited liability company co-managed by Yong Chen for $9.7 million in 2017, Department of Finance records show. A $40 million sellout is expected, according to the offering plan.

149-04 NORTHERN BLVD.

144-74 NORTHERN BLVD. A Burger King restaurant flanked by large parking lots stood on this site for years before it was demolished and replaced in 2020 by the Urban, a 7-story, 103-unit luxury apartment building. A local family named Hogsett, the longtime owner of the wide midblock property, appears to have developed the red brick building, whose windows are trimmed in black. Amenities include a gym, a roof deck and a work lounge. The least-expensive apartment this month was a one-bedroom unit for $2,425 a month, according to StreetEasy.com. Sidewalk-level retail spaces include a branch of Bank of America and an outpost of H Mart, the popular Asian grocery chain. Hogsett has reinstalled a Burger King.

147-34 NORTHERN BLVD. This collection of a half-dozen storefronts, including takeout joints and casual-clothing stores, resembles much of the commercial presence on Northern Boulevard: single-story, midcentury and modest. The owner of the 16,600-square-foot structure is Silver Oak Realty Group, a Long Island-based firm that bought the site for $5.2 million in 2004. Its value today is $5.6 million, according to its 2023 city assessment. Silver Oak borrowed $7 million against the property in 2016, in a loan from Queens-based Melrose Credit Union. The site’s zoning, R5, allows several small-scale apartment buildings.

One of the first projects to take advantage of Northern Boulevard’s drastically underbuilt lots was this 29-unit condo project, which opened in 2010. The 6-story building arose from the site of a former auto dealership, Tristate Auto Mall, which relocated farther east, to 190th Street and Northern Boulevard. The dealership’s owner and site seller was John Zanetti, who sold his property for $12.6 million in 2008, according to records. Zanetti also owns Bayside Chrysler in Bayside. The condo, which seems to have unloaded all its sponsor units, did see a sale in the fall of 2021. A two-bedroom with an open-floor plan traded for $670,000, a notable discount from its March 2021 price of $749,000 GLACIER EQUITIES, GOOGLE MAPS

mid a surge in Queens’ Asian population, a wave of development is rippling across Greater Flushing, the borough’s Chinatown. On Northern Boulevard, luxury rentals are rising from parking lots, skinny condos are springing up from strip malls, and landlords are snapping up apartment buildings that haven’t changed hands in years. Developers are marketing the projects to Asian buyers; the Asian share of the population jumped from 547,000 to 706,000 between 2010 and 2020, or nearly 30%, according to census figures. Among the latest to capitalize on the busy submarket is Glacier Equities, which is marketing dozens of unsold units at 148-09 Northern Blvd., a condo that failed to sell out the first time around. During the spring of 2021, Glacier snapped up 62 apartments in the 87-unit building, and after phased renovations, it is selling batches of them, with the first major group arriving last week. “There’s a lot of activity here because there’s a realization that Flushing has been exploding and will continue to explode,” said Myles Horn, the managing partner of Glacier, which specializes in buying unsold units, often in older buildings in Queens. “We are the alternative to the shiny new buildings that generally have smaller rooms and no Old World charm.” No. 148-09, named Northern Lights, is a 1928 Italianate building with working fireplaces in almost every apartment. Glacier has added new kitchens and reconfigured some units for extra bedrooms. The firm is planning to create amenities, such as a gym in the basement, and to renovate hallways, lobbies and a courtyard. RockFarmer Properties, a developer that also targets unsold shares in coops and condos, had tried to convert the 6-story building into a condo under a plan approved by the state in 2009. But dozens of sponsor units never found buyers and they were instead rented. Prices at Northern Lights start at $689,000 for a one-bedroom unit or around $845 per square foot, a rate that represents a sharp increase from RockFarmer’s earlier effort. For instance, RockFarmer marketed No. 4D, a two- bedroom apartment, for $276,111, according to its offering plan. About a decade later, Glacier is trying again with the same unit at $799,000. “If we buy at $400,000, we spend $200,000, and then we sell at $800,000,” Horn said of his general business plan, which may find takers. Across Queens, condos are selling at an average of $770,000, or about $900 per square foot, according to a fourth-quarter market report from the firm Douglas Elliman. ■

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FINANCE

Ponzi schemer in Bar Works coworking sham is sentenced to more than 11 years in prison

he saga of Bar Works, one of New York’s biggest-ever real estate scams, crossed a milestone recently when a perpetrator of the Ponzi scheme was sentenced to more than 11 years in prison. James Moore was also ordered to pay $58 million in restitution by U.S. District Judge Richard Berman, who recommended the 60-year-old British national serve his 140-month sentence near his Miami home.

overseas and were ignorant of U.S. law but seduced by the idea of owning a slice of New York real estate. One said a broker assured him the investment was safe because the Securities and Exchange Commission investigates fraud and “would not allow this to happen and they would arrest the one who was responsible.” The SEC doesn’t have the authority to make arrests.

The hustle The Bar Works scam hearkens back to a time and place when entrepreneurs were trying to mimic WeWork. Moore and CEO Renwick Haddow teamed up in 2015 to sell gullible individuals on their coworking idea. They rented locations, including 41 W. 46th St. and 47 W. 39th St., and hustled average investors on their company, whose slogan was “work space with vibe,” and offered beer alongside worker tables. Moore’s role was to devise and distribute marketing materials he

JAMES MOORE, 60, WAS ALSO ORDERED TO PAY $58 MILLION IN RESTITUTION Investor Pamela Spooner of the U.K., who is in her 60s, lost her pension savings and said she thought about suicide almost every day. “All that stops me is knowing I would heap even greater pain on my daughter,” she told the court. Most Bar Works investors lived

DANIEL GEIGER

BY AARON ELSTEIN

A BAR WORKS location on West 46th Street knew contained falsehoods. To cover up past investment cons and government sanctions, Haddow was identified in pitch books as “Jonathan Black.” Moore repeatedly lied when the SEC and IRS started asking about Black’s true identity. Investors were assured they were getting a “secure” and “proven” investment in Manhattan real estate with “guaranteed returns” of 12% to 16%. In fact, they were getting the right to collect rent from an individ-

ual workstation, a highly unstable source of revenue that isn’t profitable for most providers, including WeWork. Prosecutors said Moore and affiliated companies siphoned 65% of investor money.

‘A clear message’ Moore was convicted at trial in 2019 and his “lengthy sentence sends a clear message that perpetrators of investment fraud will be prosecuted and held accountable,”

U.S. Attorney Damian Williams said. Haddow pleaded guilty to four criminal counts, and prosecutors said he’s been cooperating. He is to be sentenced April 8. A third defendant, Savraj GataAura, pleaded guilty in 2019 to one criminal count and was sentenced to 48 months. He is in a West Virginia federal penitentiary until 2024, according to his sentence. Bar Works victims are looking to the U.S. government to help recover losses. It’s unlikely they’ll be made whole. Two weeks ago federal prosecutors in Boston said they had recovered $885,000 for investors who lost $1.9 million in a separate real estate fraud. An Italian Bar Works investor said his wife was so stressed after they lost $500,000 that she gave birth to their daughter five weeks prematurely. Another in Oman just couldn’t bear to share the bad news with his family. “I … have to lie to my wife to protect our marriage,” the investor said, “because she can be very sensitive if she knows that I lost some of the money for our children’s education.” ■

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FEBRUARY 14, 2022 | CRAIN’S NEW YORK BUSINESS | 5

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IN THE MARKETS

Wall Street’s undertakers prepare for a surge in ailing companies filing for bankruptcy protection vous about their business prospects.”

‘Restructuring watch’ Nervous companies likely include the more than 100 on S&P Global’s “restructuring watch” list. It includes fitness outfit Equinox and cosmetics giant Revlon, whose debt burden is described by S&P as “unsustainable.” With prospects growing that some or many of these firms will end up in bankruptcy court, Baird, an investment bank that serves midsize companies, launched a restructuring advisory business last year and hired a Lazard alumnus last month. Also last month, the law firm Paul Weiss Rifkind Wharton & Garrison hired veteran attorney Kenneth Ziman, who worked on the PG&E and MF Global bankruptcies, among many others. “Every boom cycle ends with a credit event that no one foresees,” Ziman said. Restructuring experts are mind-

ISTOCK

here’s a saying that when- surge quickly eased because of the ever the Federal Reserve government’s extraordinary ecotaps the brakes, someone nomic rescue measures. PJT Partflies through the window. ners, an investment bank that speExperts in cleaning shards of glass cializes in advising distressed and attending to the injured are companies, has seen its stock price much in demand as Wall Street gain just 26% in the past two years, well below Morgan Stangears up for a surge in ley’s 93%. corporate crashes. Now, amid rising interThe world of fixing up est rates and inflation, ailing companies or helptime may finally be runing them through bankning out for struggling ruptcy court has been companies. That would be moribund for many good news for restructuryears, thanks to the exing specialists including ceptionally strong PJT, Houlihan Lokey, and prepandemic economy and rock-bottom interest AARON ELSTEIN Lazard. “The headwinds we exrates giving struggling perienced in our restrucenterprises room to returing business in 2021 have substructure debts. Business bankruptcies fell by a sided,” PJT CEO Paul Taubman said third last year, to 14,347, according on a recent conference call. “We to figures from the Administrative certainly are seeing increasing Office of the U.S. Courts, the fourth stress building in the system, and decline in five years. A flurry of re- we are seeing companies having tailers and gyms sank into Chapter more difficulty in refinancing. 11 early in the pandemic, but that We’re seeing companies more ner-

ful they got burned when they thought their ship had come in two years ago. Reasons for continued caution include the fact interest rates remain low by historic levels, and plenty of private-equity firms and other alternative lenders are willing to provide capital to struggling borrowers, even if banks are not. Corporate defaults last month ran at just 0.29% of loans, according to S&P LCD, the lowest level since November 2007. Of course, bankruptcy and re-

structuring specialists that staffed up in 2007 were ideally positioned for all the work that came their way starting in 2008. Houlihan Lokey CEO Scott Beiser said there is “a lot of potential” for a surge in restructuring work because high corporate debt levels combined with rising interest rates create “a positive framework.” “We see clearly certain grassroots are increasing,” he said on a call last Tuesday. “They haven’t started to sprout yet.” ■

ON POLITICS

State Democrats’ redistricting formula bolsters their power—expect big money to follow

wo weeks ago the Demo- lican gerrymander from a decade crats who control the New ago, Democrats drew districts of York Assembly and the their own and added two new seats state Senate released their in New York City, guaranteeing legislative lines for the next decade, control of the upper chamber—and completing a fraught and secretive perhaps their veto-proof supermajority—indefinitely. redistricting process. The outcome was not surprising but still notable enough to make Vanishing GOP national news: The Democrats had Republican power in New York engineered new districts state, a prominent feature to potentially boost their for much of the past cenHouse delegation in New tury, has officially vanYork by at least three ished. Certain influential members. In Brooklyn lobbies that traditionally and Staten Island, Trump had a great amount of Republican Nicole Malclout in Albany, such as real estate and the charter liotakis saw her district sector, may have to battle tugged into Sunset Park, much harder to realize Park Slope and Gowanus, their policy goals. adding thousands of libMuch of this was inevieral voters who will want ROSS BARKAN table, given voting trends. to toss her out during the fall. On Long Island, Lee Zeldin’s The last Republican presidential swing district was drawn into Nas- candidate to carry New York was sau County, adding enough Demo- Ronald Reagan, and no Republican crats to possibly flip it. Upstate, the has won statewide since George PaSyracuse-area district of John Kat- taki in 2002. But Republicans, ko, a GOP moderate who is retiring, through gerrymandering and politpicked up significant Democratic ical help from centrist Democrats, were able to hold the state Senate territory. Although these moves garnered through 2018, giving them great most of the headlines—given the sway over legislation. Big money used to flow to Retenuous grip the Democrats have on the House and the fear that Don- publican Senate coffers that will ald Trump will run again—it was probably never get there again. The the actions that legislative Demo- real estate lobby, committed to crats took on the state level that will pro-development and pro-landlord have the most immediate impact policy, used to view the Republion New Yorkers. Undoing a Repub- cans, especially those outside the

city, as a bulwark against tenant-friendly Democrats. These days real estate cash is still pumping through Albany, but now it’s Democrats who are on the receiving end of the largesse. The Senate Democrats’ campaign arm, after getting outraised for years, now easily outpaces what the Republicans take in. For January, they had more than $2.5 million on hand, dwarfing the about $654,000 in the Republican coffers. Now that redistricting is done—Republicans are challenging the gerrymanders in court under a new provision in the state constitution, but undoing the maps is a long shot—this gap in funds will only grow. Certain special interests, such as the Real Estate Board of New York, will get less out of the Democrats. REBNY can’t hope for downstate Democrats to weaken rent-stabilization laws. But the fight over strengthening protections for tenants facing eviction could be one where REBNY cash pushes some Democrats into a position more favorable to landlords. Wall Street donors supportive of charter schools won’t get the number of publicly funded, privately run schools boosted in the city anymore, but enough money could safeguard the gains the sector has made and ensure the Democrats don’t try to repeal a Cuomo-era law that forces the Department of Education to

pay the rent of all city charters or find free space for them. One clear impact of the new cash being directed toward Democrats is in the surprising fight over to-go cocktails. Temporarily legalized during the pandemic, they now enjoy the support of Gov. Kathy Hochul, who wants to make them permanent. But the liquor store lobby, a quiet force in Albany, has marshaled its weight against it, enlisting the state troopers union, which has expressed concern about a possible increase in drunken driving. To-go cocktails were wildly popular and a lifeline for the restaurant industry. Still, the battle represents an old rule in Albany: Money matters when you have a lot of it. The liquor store lobby has pumped more than $30,000 into the coffers of the deputy leader of the state Senate, Michael Gianaris, and sent significant money to Assembly Speaker Carl Heastie. Gianaris, a progressive friendly with Alexandria Ocasio-Cortez known for his help in killing the Amazon deal in 2019, was honored at the annual dinner of the Metropolitan Package Store Association, the liquor store lobby group, in 2021. Gianaris told the Times he backs to-go cocktails as well as a resolution that “hopefully does not hurt other small businesses,” which could signal some kind of weakening of the initiative. With Hochul’s blessing and enough legislators

wanting to deliver on the popular program, liquor stores will most likely have to accept the reality of new competition. But until then the lobbyists know what they have to do. The Democrats are the only game in town, and they will find themselves with all the big money. How many votes will it move? This legislative session will be telling.

Quick hits ● Joe Biden’s visit to New York was welcome, but why was crime the only serious topic discussed? New York has not, like the rest of America, recovered economically as the pandemic continues to take a toll on the tourism and hospitality industries. Eric Adams could have raised this reality with the president. ● Are more socialists coming to Albany? The new state Senate district in Queens already has a member of the Democratic Socialists of America running who might be a front-runner in the open primary. ● Chuck Schumer will avoid anyone primarying him later this year. But if he can’t oversee any successful legislative efforts in 2022, he may not get another chance to be majority leader. Democrats will struggle to keep the Senate. His legacy will ride on the next 11 months. ■

Ross Barkan is an author and journalist in New York City.

6 | CRAIN’S NEW YORK BUSINESS | FEBRUARY 14, 2022

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SPONSORED CONTENT

REAL ESTATE

talking

TAX

WHAT TAX CHALLENGES AND OPPORTUNITIES DO COMPANIES FACE IN LIGHT OF TODAY’S GLOBAL SUPPLY CHAIN ISSUES? Most businesses have been feeling the impact of supply chain disruptions on their operations and their ability to meet customer demand. But many of them have not evaluated its impact on their taxes, one of the major influences on a company’s bottom line.

SHASHI SINGAL, CPA, MSA, CA

NATALIE SACHMECHI

THE HISTORIC MIDTOWN INN is now operated by Hilton.

Inside the revival of the palatial Martinique Hotel BY NATALIE SACHMECHI

f you’re looking for evidence of a more glamorous era in New York City, you’ll come across it in the vintage mosaic tiles and gold Romanesque staircases of the Martinique Hotel, where such rapt attention to architectural detail resulted in a perfect loop of stairs spiraling to the top floor. Constructed in 1898, the historic hotel, situated on Greeley Square, has seen two world wars and the Spanish flu, served as a welfare hotel and was eventually turned into a Holiday Inn. But never before has the hotel’s life been hanging by a thread as thin as during the last two years, when it was shut down, bereft of guests and bankrupt. It closed March 18, 2020, furloughed all of its staff and filed for bankruptcy protection that September. The 510room building was on a land lease

THE HOTEL PRESENTED AN OPPORTUNITY FOR A WELL-FUNDED INVESTOR that still had 68 years left on it. Two months later the hotel’s owner, Harold Thurman, passed away, leaving the estate to his family. The hotel presented an opportunity for a well-funded investor to buy it at a discount and hold on to it until the city’s tourism industry picked up. But it was on an expensive ground lease, was landmarked and unionized, required $15 million in facade repairs and had more than 30,000 square feet of vacant retail space. “This was a scary deal,” said Eric

Shashi Singal is a tax partner at Grassi. She specializes in domestic and international tax planning, structuring and compliance for clients in the real estate and manufacturing and distribution industries.

Multinational companies face transfer pricing challenges; as comparability and benchmarking data from normal times may need additional review with enhanced studies using longer timeframes. Reference data from previous adverse events may be helpful. Companies may benefit from reviewing their transfer pricing documentation process and intercompany agreements to find synergies in improving cost efficiency, conducting risk assessments, and maintaining reliable analysis and documentation of tax compliance in the event of tax audits.

HOTEL HISTORY

Indirect taxes, including value-added tax and goods and services tax, are also affected by a modified supply chain because they are driven by the place of supply. Diversifying supply chains domestically requires businesses to consider whether their business activity creates physical presence or exceeds certain other state thresholds that establish a connection with the tax jurisdiction and impose sales and use tax, income tax or other reporting requirements. When making changes to domestic links in the supply chain, it is essential to perform nexus studies to determine state tax obligations.

$55.5M

Apart from pandemic-related supply chain issues, businesses have sustainability issues to consider when creating a tax-efficient supply chain. Many jurisdictions offer credits and rebates, among other tax incentives, for integrating sustainability into their supply chains. Business owners should ensure they are taking advantage of all applicable tax benefits and consistently considering new ways to make their link in the supply chain more sustainable.

financing for the acquisition with virtually all of the hotel’s retail space empty. Getting it leased was the missing piece of the puzzle. Taking a chance Danny Volk, a veteran YEAR the Martinique Hotel of the city’s nightlife After a year of marketwas built scene and a former execing efforts that fell on utive at Catch Hospitality deaf ears, a believer from Group, partnered with Oklahoma City, Andy broker Andy Kim to lure Burnett of Burnett Equinew eateries and cafés ty, took a chance on the AMOUNT the inn into the hotel’s empty rebuilding. recently sold for tail pockets. Volk preBurnett, an outsider to to Andy Burnett dicted he’d be able to the city’s hotel industry, of Oklahoma's score high rents for each signed a contract to take Burnett Equity of those spaces, though on the burden for $75 others had doubts. million, but when it was ”Nobody believed us,” added time to go firm on the deal, the Delta variant threatened the hotel in- Anton. “The lender didn’t believe us. The owner started to not believe dustry all over again. “The lenders and equity inves- us.” But in less than 12 weeks, the tors said, ‘Uh oh, we don’t know if we can move forward,’” Anton re- duo leased six vacant spaces to called. It became clear that be- three restaurant groups for 15 years cause of the ground with an asking rent of $250 per lease and vacant square foot. Once the leasing momentum retail, a deal would not be made at that was strong enough, brokers from Mission Capital found ample fitime. So it was time to nancing to close the acquisition, get creative. The and the deal went through for a first step was to go cool $55.5 million. against conventional real estate practices and get Test of time the landowner and buyer of the hoToday, the hotel is open and optel to negotiate the terms of the erating. Guests, though scarce, land lease. make appearances in the lobby, Anton took Burnett to dinner and much of the furniture and with the landowner’s daughter and lighting fixtures that decorated the her lawyer at Avra Estiatorio, a hotel before the pandemic are still Midtown dining staple for the city’s present. real estate deal makers. They inSome of it will be redecorated by stantly hit it off. Hilton, which is now operating the “They get along very well. It hotel, Volk said. couldn’t have gone better,” Anton But the parts of the Martinique said. They renegotiated the ground that have held on across more than lease to more favorable terms for a century—the tiles, the baroque the new owners, but there was still molding and the marble stairs— another hurdle. will continue to stand the test of Burnett wasn’t going to get any time. ■

Anton of Marcus & Millichap, the broker representing the sellers. “It had every challenge you can imagine.”

Partner Grassi Advisors & Accountants ssingal@grassicpas.com

Supply chain management affects tax planning strategies in several ways. Covid-19 demonstrated the importance of supply chain diversification; sourcing materials and goods from new suppliers and geographies, however, will have an immediate and direct impact on the company’s tax obligations. The taxation rules and available benefits in each state, country and locality should be carefully considered to ensure both compliance and optimal tax efficiency.

1898

At the same time, many jurisdictions are imposing penalties for supply chain practices that negatively affect the environment. Avoiding these penalties will require a significant investment of resources but may open additional tax incentive opportunities, particularly in the area of research and development credits. Companies facing inflationary pressure and higher prices because of supply chain disruptions and higher freight costs may want to consider adopting the last-in, first-out inventory (LIFO) valuation method. Under LIFO, the most recently purchased inventory items are deducted first in computing taxable income, thus absorbing higher prices in the cost of goods sold and reducing taxable income for the current year. It is an income and tax deferral mechanism that can produce current tax savings that will reverse when prices decline and older lower-cost layers are removed from inventory. Capital assets must be placed in service by the end of the year to take advantage of tax deductions, such as bonus depreciation and the Section 179 deduction under current U.S. tax law. Continuing supply chain disruption could threaten a business’s ability to take advantage of these tax benefits if the business cannot acquire machinery, equipment or components and place them into service by year’s end. 2022 is the final year for 100% bonus depreciation before it phases out with a 20% reduction each year from 2023 until 0% in 2027. Business owners may want to accelerate capital expenditures and review their procurement timeline for orders – both international and domestic components. It is more important than ever for organizational tax departments to work closely with business operations and purchase officers to establish supply chain resilience, security, transparency and tax efficiency throughout the supply chain.

FEBRUARY 14, 2022 | CRAIN’S NEW YORK BUSINESS | 11

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THE LIST MOST ACTIVE VENTURE CAPITAL FIRMS Ranked by number of investments in New York metro area-based startups in 2021

NYC CEMENTS ITS STATUS AS A RIPE TARGET FOR VCS

A SWIFT RECOVERY

1 2 3 4 5 6 7 8 9 10 11 12 12 14 14

COMPANY/ ADDRESS 1

PLANTING SEEDS

Seed rounds were the most common type of funding round in 2021, followed by Series A.

Both the amount of funding going to NYC companies as well as the number of deals skyrocketed in 2021, after a slight lull in 2020.

he startups of NYC had a watershed year in 2021. While Silicon Valley remains the tech capital of the U.S., the city achieved the No. 2 slot last year, boasting more than $54 billion in funding, nearly triple its 2020 figure, according to business analytics firm CB Insights. Consistent with the venture capital market overall, the number of deals in the city swelled, along with their sizes. The 1,850 deals were, for the most part, spread evenly throughout the year, with the most activity, 503 deals, taking place during the third quarter. The 20 most active VC firms of 2020 injected $7 billion into New Yorkbased companies. In 2021 that same number more than quadrupled, to $32 billion. Venture capital firms are making many more deals in the Big Apple as well. In 2020 just six venture capital firms did more than 20 deals in the metropolitan area. This year there are 19. California-based Y Combinator maintained its No. 1 slot on our list of the most active venture capital firms in the city. It made 54 investments in metropolitan area startups. Gaingels, a coalition of investors focused on diversity and purpose-based investments that’s headquartered in the Flatiron District, shot up in rankings. It invested in New York companies 51 times, earning it second place, a sizable jump from No. 21 last year, when it made just 11 investments. Midtown-based Tiger Global Management also made significant strides, upgrading from eighth place last year, with 19 investments, to third this year, with 45. The firm was the top investor across the U.S., backing 328 companies. As we head into 2022, the question remains: Will the city’s VC moment last? — Amanda Glodowski

RANK

AMANDA.GLODOWSKI@CRAINSNEWYORK.COM

NY Funding (in billions)

Number of Deals

$60B

2,000

$54.3B $50B

Pre-seed 1,800

1,850

Series C

$40B 1,600

$15.4B $15.8B

$13.9B

389

Seed

1,569

1,400

$20.8B

$20B

$18.9B

836 1,200

$10B

2017 2018 2019

2020 2021

Series A

1,237

Series B 2016

170

325

636

$30B

Series E

Seried D

1,000 SOURCE: CB Insights, Crunchbase

OF NY DEALS were early stage

NUMBER OF INVESTMENTS IN METRO-AREA STARTUPS IN 2021

INCREASE in number of deals from 2020

187

TOTAL VALUE OF METRO-AREA FUNDING THREE LARGEST ROUNDS (IN MILLIONS) METRO-AREA DEALS IN IN 2021 3 2021

JUMP in funding from 2020

MOST FREQUENT TYPE OF FUNDING ROUND IN 2021

WEBSITE

SENIOR MANAGEMENT 2

Y Combinator 335 Pioneer Way Mountain View, CA 94041

ycombinator.com

Geoff Ralston, President

Gaingels 43 W. 23rd St. New York, NY 10010

gaingels.com

David Beatty, Managing member Paul Grossinger, Lorenzo Thione, Peter Steinberg, Managing partners

$1,857.5 BlockFi, Bowery Farming, Jackpocket

Seed

Tiger Global Management 9 W. 57th St. New York, NY 10019

tigerglobal.com

Scott Shleifer, Partner

$7,109.4 UiPath, Attentive, Dataiku

Series B

Techstars 1050 Walnut St. Boulder, CO 80302

techstars.com

Maëlle Gavet, Chief executive

$43.0 Axle, Vitally, Dash

Pre-seed

Bessemer Venture Partners 285 Madison Ave., Suite 1401 New York, NY 10017

bvp.com

Charles Birnbaum, Alex Ferrara, Bob Goodman, Jeremy Levine Rob Stavis, New York office partners

$3,915.5 NYDIG, Clatoty, Forter

Series C

BoxGroup 99 University Place New York, NY 10003

boxgroup.com

David Tisch, Founder, investor

$1,742.3 Ro, Ramp, K Health

Seed

General Catalyst 434 Broadway, sixth floor New York, NY 10013

generalcatalyst.com

Joel Cutler David Fialkow David Orfao, Founders

$2,498.9 Ro, Bowery Farming, Melio

Seed, Series A, Series B, Series C

Andreessen Horowitz 2865 Sand Hill Road Menlo Park, CA 94025

a16z.com

Marc Andreessen Ben Horowitz, General partners

$1,390.8 Current, Cedar, OpenSea

Series A

10X Capital 1 World Trade Center New York, NY 10007

10xcapital.com

Thomas Hans, Founder, chief executive

Insight Partners 1114 Sixth Ave., 36th floor New York, NY 10036

insightpartners.com

Jeff Horing Jerry Murdock, Cofounders

$3,032.8 DriveWealth, Dataiku, Papaya Global

Series C

Thrive Capital 295 Lafayette St. New York, NY 10012

thrivecap.com

Joshua Kushner, Founder, managing partner

$1,953.3 Ramp, Melio, Cedar

Series B

Coatue 9 W. 57th St., 25th floor New York, NY 10019

coatue.com

Phillipe Laffont Thomas Laffont, Founders

$3,632.0 UiPath, Attentive, Fireblocks

Series B

Sand Hill Angels 1060 La Avienda St. Mountain View, CA 94043

sandhillangels.com

$1,180.6 Bowery Farming, DailyPay, Thirty Madison

Series C

Hatzimemos Libby Holdings

h-l.vc

Eric Hatzimemos, Chairman, chief executive Oliver Libby, Managing partner

primary.vc

Ben Sun Brad Svrluga, General partners

12 | CRAIN’S(H/L NEWVentures) YORK BUSINESS | FEBRUARY 14, 2022

30 Rockefeller Plaza New York, NY 10112

Primary Venture Partners

P012_P013_CN_20220214.indd 12 19 W. 24th St.

New York, NY 10010

$92.7 Ophelia, Yotta Savings, Totan

$55.9 Jetty, Percent, BlocPower

$62.0 Loliware, Vivvi Inc., Spark Neuro Inc.

$653.2 Electric, Odeko, Vestwell

Pre-seed

Seed

RAN

Sou and Cru is s

Series A/B

Seed, Series A

8 9 1 1 1 1 1 21 31 41 51 61 7 2 8 2 9 2 1 2 1 2 1 2 1 2 12 12 12 13 13 13 23 23 2 2 2 2

2/10/22 4:47 PM

COM

Seed

es A

base

8 9 10 11 12 12 114 214 314 417 517 617 7 20 8 20 9 20 10 23 11 24 12 24 12 24 14 24 14 28 14 28 17 30 17 30 17 30 30 20 30 20 20 23 24 24 RANK

Andreessen Horowitz 2865 Sand Hill Road Menlo Park, CA 94025

a16z.com

Marc Andreessen Ben Horowitz, General partners

10X Capital 1 World Trade Center New York, NY 10007

10xcapital.com

Thomas Hans, Founder, chief executive

Insight Partners 1114 Sixth Ave., 36th floor New York, NY 10036

insightpartners.com

Jeff Horing Jerry Murdock, Cofounders

$3,032.8 DriveWealth, Dataiku, Papaya Global

Series C

Thrive Capital 295 Lafayette St. New York, NY 10012

thrivecap.com

Joshua Kushner, Founder, managing partner

$1,953.3 Ramp, Melio, Cedar

Series B

Coatue 9 W. 57th St., 25th floor New York, NY 10019

coatue.com

Phillipe Laffont Thomas Laffont, Founders

$3,632.0 UiPath, Attentive, Fireblocks

Series B

Sand Hill Angels COMPANY/ 1060 La Avienda St. ADDRESS 1View, CA 94043 Mountain

sandhillangels.com WEBSITE

SENIOR MANAGEMENT 2

YHatzimemos CombinatorLibby Holdings (H/LPioneer Ventures) 335 Way 30 Rockefeller Mountain View,Plaza CA 94041 New York, NY 10112 Gaingels Primary Venture 43 W. 23rd St. Partners 19 W.York, 24thNYSt.10010 New New York, NY 10010 Tiger Global Management 9SOSV W. 57th St. 1188York, YorkNY Ave. New 10019 New York, NY 10065 Techstars Contour Venture 1050 Walnut St. Partners 475 ParkCO Ave. S., sixth floor Boulder, 80302 New York, NY 10016 Bessemer Venture Partners LererMadison HippeauAve., Suite 1401 285 100 Crosby New York, NYSt. 10017 New York, NY 10012 BoxGroup RREUniversity VenturesPlace 99 130 E. 59th New York, NYSt. 10003 New York, NY 10022 General Catalyst 434 Broadway, sixth floor Founders New York, Fund NY 10013 1 Letterman Drive Andreessen Horowitz San Francisco, CA 94129 2865 Sand Hill Road Greycroft Menlo Park, CA 94025 292 Madison Ave., eighth floor 10X New Capital York, NY 10017 1 World Trade Center Operator New York, Partners NY 10007 139 Reade St. Insight Partners New York, NY 10013 1114 Sixth Ave., 36th floor FJ Labs New York, NY 10036 19 W. 24th St. Thrive Capital New York, NY 10010 295 Lafayette St. GV York, NY 10012 New 1489 Charleston Road Coatue Mountain View, CA 94043 9 W. 57th St., 25th floor Lightspeed New York, NYVenture 10019 Partners 2200 Sand Hill Road Sand Angels MenloHill Park, CA 94025 1060 La Avienda St. Lux Capital Mountain View, CA 94043 295 Madison Ave. Hatzimemos New York, NY Libby 10017Holdings (H/L Ventures) PlugRockefeller and Play Tech 30 PlazaCenter 440 N. Wolfe Road New York, NY 10112 Sunnyvale, CA 94085 Primary Venture Partners Sequoia Capital 19 W. 24th St. 2800York, SandNYHill Road, Suite 101 New 10010 Menlo Park, CA 94025 SOSV SV Angel 1188 York Ave. 588 Sutter New York, NYSt.10065 San Francisco, CA 94102 Contour Venture Partners AccelPark Ave. S., sixth floor 475 500 University Ave. New York, NY 10016 Palo Alto, CA 94301 Lerer Hippeau Alumni Ventures 100 Crosby St. 788 Elm New York,St. NY 10012 Manchester, NH 03101 RRE Ventures IndexE.Ventures 130 59th St. 139 Townsend St. New York, NY 10022 San Francisco, CA 94107

h-l.vc ycombinator.com

Eric Hatzimemos, Chairman, chief executive Geoff Ralston, President Oliver Libby, Managing partner

22 54

gaingels.com primary.vc

David Beatty, Managing member Ben Sun Paul Grossinger, Lorenzo Thione, Brad Svrluga, General partners Peter Steinberg, Managing partners

51 22

$1,857.5 BlockFi, Bowery $653.2 Farming, Electric, Odeko, Jackpocket Vestwell

Seed Seed, Series A

tigerglobal.com sosv.com

Scott Shleifer, Partner Sean O’Sullivan, Founder, managing partner

45 22

$7,109.4 UiPath, Attentive, $18.5 Dataiku Aanika Biosciences, AlgiKnit, Farmshelf

Series B Convertible note

techstars.com contourventures.com

Maëlle Gavet, Chief executive Matt Gorin Bob Greene Owen Davis, General partners Charles Birnbaum, Alex Ferrara, Eric Hippeau Bob Goodman, Jeremy Levine Kenneth Lerer Rob Stavis, New York office partners Ben Lerer, Managing partners David Tisch, Founder, investor James Robinson IV, Stuart Ellman, James Robinson III, Will Porteous, Raju Rishi, Joel JasonCutler Black, General partners David Fialkow Peter Thiel David Orfao, Founders Brian Singerman Marc Keith Andreessen Rabois, General partners Ben Horowitz, General partners Alan Patricof Dana Settle Thomas Hans, Founder, chief executive Ian Sigalow, Cofounders

40 21

$43.0 Axle, Vitally, Dash $311.0 LeagueApps, Trialjectory, SmartAsset $3,915.5 NYDIG, Clatoty, Forter $577.1 Augury, Code Climate, Simulate

Pre-seed Seed and Series A

Amit Avner, Gil Shklarski Nat Turner Jeff ZachHoring Weinberg, General partners Jerry Murdock, Cofounders Fabrice Grinda Jose Marin, Founding partners Joshua Kushner, Founder, managing partner

bvp.com lererhippeau.com boxgroup.com rre.com generalcatalyst.com foundersfund.com a16z.com greycroft.com 10xcapital.com operatorpartners.com insightpartners.com fjlabs.com thrivecap.com gv.com coatue.com lsvp.com

David Krane, Chief executive, managing partner Phillipe Laffont Thomas Laffont, Founders Ravi Mhatre, Founder, managing director

35 21 34 21 32 19 30 19 29

28 18 25 17 23 17 23

sandhillangels.com luxcapital.com

NUMBER OF INVESTMENTS23 IN METRO-AREA STARTUPS IN 2021

$1,390.8 Current, Cedar, OpenSea $55.9 Jetty, Percent, BlocPower

TOTAL VALUE OF Farming, METRO-AREA$1,180.6 FUNDING Bowery THREE LARGEST ROUNDS (IN MILLIONS) DailyPay, METRO-AREA DEALS IN Thirty 3 2021 IN 2021 Madison

$62.0 Ophelia, Loliware, Yotta Vivvi Inc., $92.7 Spark Neuro Savings, TotanInc.

Series A

Seed

Series C

MOST FREQUENT TYPE OF FUNDING ROUND IN 2021

Series A/B Pre-seed

Series C Series B

$1,742.3 Ro, Ramp, K Health $1,274.8 Boost Insurance USA Inc., Anomaly Insights Inc., Domain Money $2,498.9 Ro, Inc. Bowery Farming, Melio $1,517.0 Ramp, Up&Up, Chronosphere $1,390.8 Current, Cedar, OpenSea $821.7 Public.com, JOKR, Thirty Madison $55.9 Jetty, Percent, BlocPower $255.5 Landis, Oshi Health, Ophelia $3,032.8 DriveWealth, Dataiku, Papaya Global $365.5 JOKR, June Homes, Morty $1,953.3 Ramp, Melio, Cedar

Seed Series B

$1,501.5 Cockroach Labs, SecurityScoreboard, $3,632.0 UiPath, Tend Attentive, Fireblocks $965.6 Grafana Labs, Alloy, Offchain Labs $1,180.6 Bowery Farming, DailyPay, Thirty $1,178.1 Madison Ramp, Chronosphere, Genvid Technologies $62.0 Loliware, Vivvi Inc., Spark Neuro Inc. $15.1 Axle, Taktile, QuikReturn

Series B

Seed, Series A, Series B, Series C Series B Series A Seed Seed Seed Series C Series A Series B

Series B Seed, Series C Series C Series C

plugandplaytechcenter.com

Peter Hébert Robert Paull Eric Chairman, chief executive JoshHatzimemos, Wolfe, Co-founders, partners Oliver Libby, Managing partner Saeed Amidi, Chief executive

primary.vc sequoiacap.com

Ben Sun Doug Svrluga, Leone, Global Brad Generalmanaging partners partner

22 16

$653.2 Electric, Odeko, $3,192.2 Vestwell Fireblocks, Grafana Labs, Landis

Seed, Series A Series A, Series C

sosv.com svangel.com

Sean O’Sullivan, Founder, managing partner Ron Conway, Topher Conway, Co-managing partners

22 16

Convertible note Series A

contourventures.com accel.com

Matt Gorin Arthur Patterson Bob Greene Jim Swartz, Owen Davis,Founders General partners

21 15

$18.5 Aanika Biosciences, $206.7 AlgiKnit, Block Renovation, Farmshelf Saturn Technologies, Kalshi $311.0 LeagueApps, $1,883.9 Trialjectory, Squarespace, Melio, Public.com SmartAsset

lererhippeau.com avgfunds.com

Eric Hippeau Michael Collins, Kenneth Lerer Chief executive, board chairman Ben Lerer, Managing partners

21 15

$577.1 Augury, Code Climate, $293.9 Simulate RapidSOS, Holler, Obligo

Series B Seed

rre.com indexventures.com

James Robinson IV, Neil Rimer, Chief executive Stuart Ellman, James Robinson III, Will Porteous, Raju Rishi, Jason Black, General partners

21 15

$1,274.8 Boost Insurance USA $1,406.6 Inc., Cockroach Labs, Anomaly Insights Capitolis, Glossier Inc., Domain Money Inc.

Series B Series A

Khosla Ventures Founders Fund Sand Hill Road 12128 Letterman Drive Menlo Park, CA CA 94025 San Francisco, 94129

khoslaventures.com foundersfund.com

Vinod Thiel Khosla, Founder Peter Brian Singerman Keith Rabois, General partners

15 19

$1,086.5 Ramp, Up&Up,Up&Up, OpenTrons, $1,517.0 SWORD Health Chronosphere

Series B C

New Enterprise Associates Greycroft 104 Madison Fifth Ave.Ave., eighth floor 292 10011 New York, NY 10017

nea.com greycroft.com

Tony Patricof Florence, General partner, New York Alan Dana Settle Ian Sigalow, Cofounders

15 19

$603.6 Public.com, Aetion, Candy Digital, $821.7 JOKR, Pager Madison Thirty

Series C Seed

Operator Partners 139 Reade St.

operatorpartners.com

Amit Avner, Gil Shklarski Nat Turner

$255.5 Landis, Oshi Health, Ophelia

Seed

h-l.vc

Series A/B Convertible note

Seed and Series A Series B, Series C, Series D

Source: Crunchbase; additional research by Amanda Glodowski. Funded companies need to be headquartered in the greater New York area, as defined by Crunchbase. Funding types included are all venture series plus angel, pre-seed, seed Newfunding York, NY 10013Individual investors are omitted. This list includes some organizations Zach Weinberg, General partners and undefined rounds. that make investments in startups but may not technically be considered venture capital firms. Only closed deals are publicized through the Crunchbase platform are included, excepting the individual submissions sent by Contour Venture Partners, RRE and Hatzimemos Libby. In cases of ties, firms are ranked alphabetically. n/d-Not disclosed. 1--If applicable, the firm's metro-area office Labs Fabrice Grinda rather than the specific amount the firm invested.18 $365.5 JOKR, June Homes, Series A is shown. 2--IfFJapplicable, metro-area senior management is fjlabs.com listed. 3--Sum of deals in which the firm participated,

19 W. 24th St. New York, NY 10010

GV 1489 Charleston Road Mountain View, CA 94043

Lightspeed Venture Partners 2200 Sand Hill Road P012_P013_CN_20220214.indd Menlo Park, 13 CA 94025 Lux Capital

Jose Marin, Founding partners

Morty

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David Krane, Chief executive, managing partner

lsvp.com

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luxcapital.com

Peter Hébert

$1,501.5 Cockroach Labs, Series B FEBRUARYSecurityScoreboard, 14, 2022 | CRAIN’S NEW YORK BUSINESS | 13 Tend $965.6 Grafana Labs, Alloy, Offchain Labs $1,178.1 Ramp, Chronosphere,

Seed, Series C 2/10/22 4:45 PM

Series C

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Advertising Section To place your listing, visit www.crainsnewyork.com/people-on-the-move or, for more information, contact Debora Stein at 917.226.5470 / dstein@crain.com

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CBIZ

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Partnership with Children

David M. Beckman, CPA, CFF, CFE has been promoted to partner in Anchin’s Litigation, Forensic and Valuation Services Group. He has broad experience in advising and consulting on the application of accounting and auditing standards, investigating accountants’ malpractice, identifying, and analyzing fraudulent financial reporting, analyzing contract and shareholder disputes, performing forensic investigations, and analyzing and quantifying economic damages in commercial and employment disputes.

Marlon J. Dunbar has joined CBIZ & Mayer Hoffman McCann CPAs, one of the nation’s top providers of accounting, tax and advisory services as Managing Director and Member of the Private Client Service (PCS) Group. In his role, he is responsible for providing a wide array of tax, accounting and consulting services to family offices, entertainers, professional athletes, radio personalities, fashion designers, entrepreneurs and other high net-worth individuals/families.

Hilco Global is pleased to announce the addition of Sheon Karol to the Hilco Corporate Finance team. Mr. Karol will serve as Managing Director in Corporate Finance/ Special Situations. Mr. Karol is a nationally prominent investment banker and restructuring advisor. He joins the Hilco Corporate Finance team to build the special situations and restructuring practice nationally. Mr. Karol will be based in the New York office.

Rachel Blitzer has joined the New York office of Latham & Watkins as counsel in the Intellectual Property Litigation Practice and as a member of the Litigation & Trial Department. Blitzer’s practice focuses on intellectual property disputes including trade secrets, patent infringement, breach of contract, and antitrust matters. She works across a broad range of technologies, including software applications, financial products, industrial machinery, medical devices, and pharmaceuticals.

Wesner Pierre has been named CEO at Partnership with Children, a nonprofit providing trauma-informed mental health counseling for NYC schoolchildren. A former executive at the Harlem Children’s Zone and VP at CAMBA, Pierre has expertise in growing education and community initiatives, and a commitment to PWC’s leadership as an antiracist organization. He is an Aspen Fellow and sits on the Board of the CUNY Masters in Youth Studies Program. Pierre holds a Master of Arts degree from Queens College.

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CONSTRUCTION

Lendlease ACCOUNTING

Crowe LLP Crowe LLP, a public accounting, consulting and technology firm in the U.S. with offices around the world, has appointed Manuel Goncalves as head of communications. He will serve on the firmwide Management Committee as well as the Market Development and Sales (MDS) Management Committee. Prior to joining Crowe, Goncalves served as global chief communications officer for Bank of New York Mellon and executive director of corporate communications for KPMG LLP.

Anthony Giuliano has been appointed as the General Manager of Life Science Construction for Lendlease Americas. In this executive role, Anthony will provide oversight to the operational teams within Lendlease’s dedicated Life Science Group, strengthen client relationships, and grow the business unit’s pipeline and geographic presence. Anthony’s 30-year career highlights his successful planning and building of Life Science facilities for the top pharmaceutical and bioscience companies.

FINANCIAL / TECHNOLOGY

DailyPay DailyPay welcomes Scott Sampson as the first Chief Revenue Officer. Sampson was previously the Senior Vice President of Worldwide Sales at 8x8, a top cloud services company, where he more than doubled revenue. He also served as Chief Revenue Officer at NewVoiceMedia (now Vonage) and spent more than a decade at IBM Corporation, where he served as Vice President of Worldwide Analytics Platform and Industry Cloud Solutions Sales.

ANNOUNCE

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Crowe LLP Crowe would like to announce the hiring of Steven Kahn, CPA, as an audit partner in the real estate and construction services group out of the Crowe New York office. Kahn comes with more than 25 years of accounting and auditing experience and will focus on the strategic growth and development of audit services for the real estate industry. He earned his bachelor’s degree in accounting from Yeshiva University’s Sy Syms School of Business and is a member of the AICPA and NYSSCPA.

CONSTRUCTION MANAGEMENT

Rider Levett Bucknall Leading the efforts of our New York office, Paraic Morrissey was promoted to Associate Principal. Paraic is a member of the Royal Institute of Chartered Surveyors and brings 12 years of experience in the construction industry. Paraic has provided an array of construction consulting services for different clients in New York and across North America since 2012, focusing on diverse aspects of cost management and estimating.

Caroline Blitzer Phillips has joined the New York office of Latham & Watkins as a partner in the Mergers & Acquisitions and Private Equity Practices and as a member of the Corporate Department. Phillips represents private equity firms and public and private companies in mergers, acquisitions, investments, and joint ventures. She has significant experience representing clients throughout the power and renewables, energy transition, and infrastructure industries.

Foley & Lardner LLP Steven Petrie has joined Foley & Lardner LLP as its Chief Operating Officer. Petrie will be responsible for the global leadership and strategic oversight of the firm’s business operations. With nearly 20 years of strategy, finance, and broad operations experience in large law firm environments, Petrie will drive innovation and collaboration across the firm by developing and implementing strategic initiatives to enhance the firm’s service delivery models and client offerings.

Nixon Peabody LLP is pleased to announce that Timothy D. Sini, a former S.D.N.Y. federal prosecutor and the District Attorney and Police Commissioner of Suffolk County, has joined the firm as a partner in its Litigation Department and Government Investigations & White-Collar Defense practice. His practice will involve representing entities and individuals in a diverse array of litigation matters, internal corporate and government investigations, and white-collar defense and crisis scenarios.

Tell Metzger is the new Senior Vice President, Equity Investments at The Community Preservation Corporation (CPC). He will lead the expansion of CPC’s equity platform that invests alongside like-minded partners to promote responsible, longterm ownership of multifamily buildings. Before joining CPC, Metzger was the Managing Director of Market-Rate and Mixed-Income Housing at L+M Development Partners.

TECHNOLOGY

TransPerfect Phil Shawe CEO of TransPerfect recently hit a milestone: 2021 billed revenues of $1.11 billion. This represents a 31% increase over 2020’s total and marks the company’s 29th consecutive year of revenue growth since its founding in 1992. In Q4, total sales grew by 33% relative to 2020 Q4, adding more than $83 million in topline revenue. TransPerfect continues to solve global business challenges for our clients, and has turned into one of the most successful growth stories in the business world.

14 | CRAIN’S NEW YORK BUSINESS | FEBRUARY 14, 2022

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ASKED & ANSWERED

INTERVIEW BY SHUAN SIM

ll the co-founders of Yuvo Health, a startup that helps community health centers access lucrative value-based contracts with Medicaid, come from diverse backgrounds. That representation serves a purpose beyond checking boxes, says Janel Sia, co-founder and chief operating officer. The fourfounder team’s diversity across race and gender has helped them understand the health care experience of people of color and, thus, boosted their ability to address equity issues accordingly. Sia adds that because some members of the team had at one point received services from federally qualified health centers, which are the company’s clients now, it better informs them about which immediate needs to address.

What exactly are federally qualified health centers, and why is their work important?

FQHCs are our nation’s safety-net providers, giving quality care to those who need it most and serving many Medicaid beneficiaries and people living in poverty. Studies have suggested at least 20 million people living in more than 4,000 medically underserved areas across the country would need their services.

What is your team’s mission?

Each of us has diverse experiences interacting with

WHO SHE IS Chief operating officer, Yuvo Health AGE 32 BORN Manila, Philippines. GREW UP Bedford Hills, Westchester County, after coming to the U.S. in elementary school RESIDES Chelsea EDUCATION Bachelor’s in psychology and sociology, Columbia University FAMILY BUSINESS Sia’s family has ties to the health care industry. “My mom is a nurse, and my brother was a research scientist at Memorial Sloan Kettering,” she said. CHILDHOOD DREAM She said she’s always wanted to be in the business world. “But if I’m being honest with myself,” she added, “as a kid I wanted to be a ballerina. I still take dance classes.” ADRENALINE JUNKIE As a child, Sia enjoyed exploring an amusement park in Manila with her brother and cousin. “It’s also where I became a huge fan of roller coasters and drawn to adrenaline, to the dismay of my mom.”

health care but also expertise in different areas. I come from a history of working with community-based organizations and nonprofits that serve communities, and the other co-founders have worked in legal, health tech and health [insurance] plans. That allows

us to know not only what the current situation is but what it can improve to be. We are creating this pathway for federally qualified health centers to sustainably maximize their revenue to be able to serve people more deeply.

Do health center patients feel they receive dignified care?

A few months ago I was doing a patientengagement project with a health center in Midtown, learning more about health care interaction among community members. What struck me was when someone said, “I’ve always been a poor person, so whatever health care I can get right now is probably pretty good.” But it was said in such a nonhopeful way, which was sad to hear. There was a sense of “I am lesser than society” and “I don’t deserve dignified health care.”

How are your clients feeling about the possibility of making improvements?

Although there’s a sense of FQHCs feeling left behind, there’s consistent hopefulness for something to make things better for them operationally. They’re open to trying new models, but they need to be looped in earlier so that they can have a say and fully understand what’s going on. But even despite the challenges they face, they remain dedicated to serving people in their communities. These are organizations tasked to do the most with the least amount of money. They’ll never turn someone who needs services away just because they can’t pay or fill out paperwork. Their belief in their mission is extra motivating for our team to try harder to help them. ■

BUCK ENNIS

JANEL SIA Yuvo Health

DOSSIER

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TECHNOLOGY

Inside Peloton’s wild ride—and what’s next

n 2017 Peloton’s Chief Executive and founder, John Foley, wrote that the fast-rising exercise-tech company would lead the “next generation of technology disruption” coming out of New York—making the city poised to challenge Silicon Valley as the global hub of innovation. Five years later both of those predictions had come to pass. The city’s startup scene rivals that of California’s Bay Area in several categories, and Peloton, now a decade old, is one of the best-known tech companies born of the Big Apple. But Peloton is now at a crossroads. Foley stepped down last Tuesday amid shareholder pressure, as the company’s once high-flying stock has sunk by nearly

ing a net loss of $440 million. It cut its sales guidance for the rest of the fiscal year (which ends in June) to between $3.7 billion and $3.8 billion, down from a previous range of $4.4 billion to $4.8 billion. The firm declined to share how many New York employees would lose their jobs in the layoffs, which started last week. New York hosts Peloton’s largest corporate office, with the firm moving last year to a 300,000-square-foot spot on Manhattan’s West Side. Foley is not leaving the company, moving instead to an executive director chair role. Activist shareholder Blackwells Capital had called for Foley’s full resignation and, in a response last Tuesday, accused Foley of instead promoting himself. “Mr. Foley has proven he is not suited to lead Peloton, whether as CEO or executive chair, and he should not be handpicking directors, as he appears to have done today,” said Jason Aintabi, Blackwells’ chief investment officer. Despite his apparent demotion, Foley will still play a major role in the future of Peloton. His supervoting stock gives him about 82% of the stockholder vote. Wall Street responded positively to the news overall. Peloton’s share price gained back some of its losses Tuesday, closing the day’s trading up about 20%.

ONE OF THE NEW CEO’S FIRST ACTS WILL BE TO LAY OFF 2,800 EMPLOYEES 80%. The company is losing money rapidly and has struggled to forecast how many Americans still want its connected workout equipment following a pandemic-driven buying surge. In a conference call with analysts last Tuesday, Foley acknowledged that the company had expanded its operations too quickly and overinvested in certain areas of the business. “We own it. I own it, and we are holding ourselves accountable,” said Foley, noting he would work closely with the new CEO. “That starts today.” Barry McCarthy, a Silicon Valley veteran of Spotify and Netflix, will move cross-country to take leadership of Peloton as it faces an uphill pedal back to respectability on Wall Street. One of his first acts will be laying off 2,800 corporate employees, roughly 20% of the company. The prospect remains for a sale to a more established company. Peloton also published its quarterly earnings last Tuesday, report-

The backstory Foley’s announcement marks a dizzying fall from grace for one the city’s top pandemic winners. On Christmas Eve 2020, Peloton’s share price reached a record $162.72, with a market value near $50 billion, boosted by record sales that spring and summer. Since then the company has encountered a number of hardships. Here’s a partial list of controversies and missteps: ● April 17, 2021: The federal Consumer Product Safety Commission publishes a warning that it is aware

of the death of a small child and at least 38 instances of injuries involving Peloton’s $4,300 Tread+ treadmill. The company at first calls the report misleading and denies requests for a recall. By May the firm reverses course and recalls about 125,000 treadmills. ● Aug. 26, 2021: Peloton cuts the cost of its signature bike by 20% following an earnings report showing it recorded a net loss of $313 million between April and the end of June. The next day Peloton discloses that federal officials are investigating its handling of the recall. ● Nov. 4, 2021: Peloton reports that sales fell 17% year over year for the months of July, August and September. “Gyms are available. People can get out of their house now— they’re not locked down,” Foley tells analysts on the earnings call. Peloton’s shares open trading the next morning down 35%. ● Dec. 11, 2021: Peloton’s share price falls in response to a character having a heart attack while using one of its bikes on the Sex and the City reboot. ● Jan. 20, 2022: CNBC reports on a Thursday that Peloton has halted production of its bikes and treadmills, citing internal documents. The following Monday, activist investor Blackwells Capital publishes a letter accusing Foley of mismanagement and calling for his resignation and a sale of the company. Peloton’s stock continues to falter and is now worth 20% of what it was 14 months ago. Waning interest in tech stocks also plays a role in the company’s stock loss.

What’s next Before Foley’s announcement, Amazon and Nike were reportedly interested in purchasing the company. New leadership does not necessarily end the possibility for a deal. “We are open to exploring any opportunity that could create value for Peloton shareholders,” Foley told The Wall Street Journal, which first reported his stepping down. The company is now focused on scaling down its costs as it faces questions of whether it can continue to grow its market as people in-

FOLEY

BUCK ENNIS

BY RYAN DEFFENBAUGH

creasingly return to gyms. Jason Helfstein, an analyst at Oppenheimer & Co. who covers Peloton, said there is still room for the connected home fitness market to grow. “We still don’t know what the future looks like, of course,” Helfstein said. “But I think a point the company has made, that 4 out of 5 purchasers we’re not biking enthusiasts beforehand, tells you how they’ve expanded the addressable market.” There are still some positive metrics for Peloton. It has a growing base of nearly 3 million paying monthly subscribers and is doing a good job of keeping them. The company reported a churn rate— customers who drop its service—of

less than 1%, outperforming the estimated rates for television streaming services, such as Netflix and Hulu. Analysts peg Peloton as an attractive target. Before Foley’s announcement, Wedbush analyst Daniel Ives published a report predicting Apple could get involved in an acquisition between $12 billion and $15 billion. Ives wrote that “if Peloton was acquired by Amazon or Nike, this would propel the winning bidder on the health and fitness front as well as gain a major foothold into the living rooms of consumers globally.” ■ With additional reporting by the Associated Press

HOSPITALITY

Wanted by city restaurants: diners to come in on weekdays BY CARA EISENPRESS

ew Yorkers are dining out in droves, bringing the city back to life. There’s just one problem for restaurants: This return is a weekend-only special, leaving operators to scramble to make up lost revenue during the week. Reservations at restaurants that use OpenTable and have reopened in New York City were at 80% the level of 2019 on Saturday, Feb. 5, according to data made public by the firm. On Tuesday, Feb. 1, it was 50%. The reasons are many. Tourism, a driver of weekday dining, is down;

visitors often fill seats on weekdays when New Yorkers might be at home. Without a big group of business or international tourists, hotel occupancy is higher on weekends, an indication of regional visitation. For the week ending Jan. 29, occupancy was at 38.8% Monday through Thursday, and 50.9% on Friday and Saturday, according to figures from STR, which tracks the industry. That’s down from a high of 81.5% in mid-December. At the same time, New Yorkers and commuters are not running around the city as they once did. January subway ridership was 46% of its prepandemic level, and the

Metro-North and Long Island Rail Road were at 34% and 39%, respectively, according to figures from the Metropolitan Transportation Authority. James Mallios, owner of Amali, added that several of his regulars had told him they were spending the winter in Florida. He said they told him, “We’ll see you in March." January is typically slower than the fast-paced holidays, but last month was the worst month in recent memory, Mallios said. Some blame the recent cold weather, but this empty weekday trend preceded the temperature drop. Back in early December, Tyler Hollinger, who

owns Festival Café on the Upper East Side, noticed guests all wanted to dine in the same two-hour window: Friday or Saturday at 7 p.m. “They think, ‘You must be busy because I can’t get a reservation,’” Hollinger said. But a few hours of having a packed dining room could not make up for epically slow sales on other days, he said. To compensate for empty seats, business owners are returning to some of their pandemic-era pivots, such as meal kits. Ned Baldwin, who owns the restaurant Houseman in Hudson Square, said he had refined his offerings so that customers can now

buy prepared, vegetable-forward dishes to fill their fridge. He has also gotten serious about soup and has been creating gluten-free, warming bowls that are selling fast for delivery—about 10 soups a night, he said. That offering stands in for a day or two of dining-room sales, he said. At Brooklyn sports bar TailGate, which opened during the pandemic, January was so slow that founder Jarrod Fox decided to shut down on Mondays, Tuesdays and Wednesdays, saving on the costs of labor. He is working doubly hard to make sure that business on Thursday through Sunday can subsidize the rest of the week. ■

16 | CRAIN’S NEW YORK BUSINESS | FEBRUARY 14, 2022

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FROM PAGE 1

Committee to the MTA. “The best way to bring people back on transit, on buses, is to entice them back with lower fares.” Here is a breakdown of the changes.

How does the OMNY discount work? The MTA’s OMNY payment system allows transit riders to use a contactless card or mobile device to make fare payments. It’s a substitute for the physical MetroCard, which will be phased out in 2023. Beginning each Monday, riders using OMNY to tap and go will be charged the usual $2.75 per trip for their first 12 trips. Every subway ride after that, through the following Sunday, will be free and unlimited. The fares are thus capped after the 12th ride, for a maximum of

lating free fares. “It encourages people to get back on board, giving people options and opportunities,” she said. “People who may be limited in pay-per-ride can now travel the system more. They can get off and do things around the city.” The MTA described the program as giving customers the benefits of the unlimited card without having to decide upfront whether it makes sense for them. Free transfers between buses and subways will continue under this program, the agency said.

How do the Metro-North and LIRR discounts work? Before the pandemic, Metro-North and Long Island Rail Road monthly commuter passes were based on the idea that those commuting from the suburbs came into the city five days per week. The fares from monthly passes made up the bulk of commuter ridership, the MTA said, but ridership has plummeted in the past two years as most office workers stayed home. Commutes have yet to stabilize. Only 16% of employers said their average daily attendance in Manhattan offices exceeded 50%, according to a January survey by the Partnership for New York City. In response, the MTA is boosting

BUT SOME EXPERTS INSIST RIDERSHIP WILL REMAIN LOW UNTIL SERVICE IMPROVES $33 per week—the cost of a seven-day unlimited MetroCard. Daglian described the OMNY fare capping as a game changer that will give riders flexibility to ride the subway more often each week, knowing they are accumu-

its 10-trip discounted ticket to 20 trips and adding other discounts and incentives. The 20-trip ticket for the Metro-North and the LIRR will offer 20% off the price of 20 peak, one-way fares. During much of the pandemic, the MTA has accepted off-peak tickets at all times, but that is ending Feb. 28. “Those whose commutes have changed on the railroad get a 20% discount,” Daglian said. “It’s a riff of NJ Transit flex pass, but it’s better.” The fare price of unlimited monthly tickets on the two lines will be slashed 10% to encourage ridership. The reducedfare tickets for both the Metro-North and the LIRR will go on sale Feb. 25 and can be used beginning March 1.

What’s a CityTicket? Finally, the MTA will expand its CityTicket program to operate on weekdays in addition to weekends. The MTA CityTicket offers riders within the five boroughs a oneway, $4.50 discount on weekends on Metro-North and the LIRR. The MTA is now expanding CityTicket throughout the week, for the life of the four-month pilot, to further incentivize ridership on

BUCK ENNIS

FARES

the LIRR and Metro-North in New York City during off-peak hours. This will allow people to use CityTickets to travel on either of the commuter railroads within city bounds for a $5 flat fare Monday through Friday.

But will any of this help the MTA’s budget? Even with these temporary deals in place, some transit experts insist ridership will remain low if service continues to falter. The MTA experienced delays in service during

the omicron wave in December, struggling with staffing levels and suspended service of the B, Z and W lines entirely. The B and Z trains resumed service Jan. 19. The W resumed service on Jan. 24. “It remains to be seen whether the more affordable fares will be complemented by better service,” said Danny Pearlstein, the policy director of Riders Alliance, a transit advocacy group. “Millions of people are right now enduring the highs and lows of transit as it exists today.” ■

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SMALL SHARE

FROM PAGE 1

Money on the table

ERICA WESTLEY

Esusu is among a growing list of startups with Black founders breaking through and finding investment in a tech industry where the biggest checks have long gone largely to white and male entrepreneurs. New York City–based Black startup founders raised $783 million total in

$4.2B

AMOUNT of VC funds raised by Black startup founders in the U.S. in 2021

Growing awareness

Whose Your Landlord, or WYL, which lets people review their landlord online and helps property managers analyze PERCENTAGE the feedback, of U.S. VC funds that amount this month represents raised a $2.1 million seed round led by Black Ops Ventures, founded in 2020 with a focus on investing in startups with Black founders. Esusu’s Wemimo and Goel invested as well. WYL’s CEO and co-founder, Ofo Ezeugwu, said he faced more than 350 rejections over seven years in business. He raised a series of pre– seed round investments that total $1.1 million. That was enough to keep the business, based in Brooklyn and Buffalo, going but not to reach the type of scale expected of tech industry startups. He lost talented engineers to firms with better financial backing. That was despite traction for the company that helped Ezeugwu win admission to startup accelerators such as Google’s Black Founders Fund and Buffalo’s 43North. “We’ve been labeled the ‘MVP of landlord review sites,’ have a continuously growing user base, partnered with governments. We have shown enough to warrant $2 million. It is just interesting that it has taken seven years to get here,” Ezeugwu said. “I just don’t think it would be that way if I looked a little bit different.” Now he sees the chance to start to scale up the business and help more people find stable, safe housing. Following the rush of promises from tech investors to support Black founders in 2020, “you are starting to see the dust settle a bit—the firms that are really committed are showing that,” Ezeugwu said. Investors are more open to discussing racial inequities, said Kelly Ifill, who founded Brooklyn startup Guava last March. That has opened opportunities for Guava, which hopes to help close the racial wealth gap by providing digital banking services to Black business owners. “I’ve had this unique opportunity to build this business at a time where investors and the rest of the country are more open to having conversations that are core to what I’m building,” she said. “There were, in some ways, smoother paths for me than some of the folks building companies in 2018 and 2019, unfortunately.” She said it is important not to focus simply on the disparity in funding for Black founders but on what entrepreneurs have accomplished in spite of it. “The increased focus and awareness in creating more equity is really exciting when we think about the role that Black people and Black businesses have played in American society and culture even in the face of this type of inequity,” Ifill said. “I’m excited to see what we create and build and the impact we have when the playing field starts to level.” ■

1.4%

BUCK ENNIS

helped others avoid the type of financial exclusion their families had faced. The pair had financial industry know-how and the experience of coming from immigrant families to build the business. But investors were slow to buy in. “Over 300 VCs said no to us—that it wasn’t viable, wasn’t venturebackable, wouldn’t scale,” Wemimo said. The founders knew the grim statistic, he added, that “only 1% of venture capital goes to Black founders.” They never lost belief in the company but, to keep afloat, “we basically liquidated every asset we had,” Goel said. After closing a $130 million Series B investment round in January, Esusu reached unicorn status. Its investors include Softbank and Serena Williams. Esusu has partnerships with huge property companies such as The Related Cos., Cushman & Wakefield and Winn Residential. According to data from research firm Crunchbase, the Harlem startup is one of four local tech unicorns with a Black founder, joining CityBlock Health, fintech company SmartAsset and beauty company Pat McGrath Labs. Wemimo and Goel said the title brings the desire to open doors for other under-represented founders. “Sometimes investing in Black and brown founders is thought of as a charity case, and we are out to prove how much that is just not the case,” Goel said. “Startups like ours, that come out of diverse experiences, make for better businesses. This is not a nice thing to do—it is a must for any VC that wants to have success in this market.”

has had a different experience.”

IFILL of Guava says the equity conversations that took place in 2020 have raised awareness.

2021, according to Crunchbase, compared with $124 million in 2020. Still, the increase came in a year when overall venture investment both in the U.S. and in New York reached record levels. In a city where 20% of residents identify as Black, startups with Black founders received just 1.7% of $46 billion in venture investment, according to Crunchbase data. In the U.S., Black founders raised $4.2 billion, or 1.4% of all 2021 venture capital funding, compared with $1.1 billion in 2020. Startups with Latino founders raised about 2% of all venture capital. Although venture capital is growing quickly, it represents only a small part of business financing and is not alone in its racial disparities. But the local econo-

my emerging from Covid-19 is increasingly dependent on technology jobs, putting greater urgency on the mission to ensure all New Yorkers are sharing in its growth. The funding data represents the first full year following the murder of George Floyd by a police officer in Minneapolis in May 2020 and the global Black Lives Matter protest movement that followed. The pro-

the U.S. and expanded in the last year to companies in Latin America and Africa.

Cut the check Esosa Ighodaro-Johnson and Regina Gwynn co-founded Black Women Talk Tech in 2017 to help entrepreneurs find resources after frustrating experiences seeking capital for their individual startups. There was clear demand: More than 300 women registered for the group’s first Roadmap to Billions conference in 2017, despite Gwynn and Ighodaro-Johnson booking a room that could fit about 70. The funding environment for Black women in tech has improved in the past decade, Gwynn and Ighodaro-Johnson say. But the percentage of investment shows how far there is to go—less than 0.5% of all startup funding went to Black women in the first half of 2021, according to Crunchbase. “The best way to support a Black woman entrepreneur is to cut her a check,” Gwynn said. “There’s lots of conversation about mentorship and access. While those things are important, you can’t pay a developer with hugs and kisses.” Black Women Talk Tech has grown to a community of more than 750 founders and amassed nearly 50,000 followers on its Instagram page. The group has expanded to include Black Men Talk Tech and Black Students Talk Tech. The funding gap for Black entrepreneurs means that investors and consumers are missing out on innovation and productivity, said Ighodaro-Johnson. “If you are really about the money—the highest return—you have to open up your perspective on what a founder looks like,” she said. “It may not be a white male from one of the Ivy League schools like you normally have seen. They are not going to see the same problems as the girl from Harlem, the Black woman who

“YOU HAVE TO OPEN UP YOUR PERSPECTIVE ON WHAT A FOUNDER LOOKS LIKE”

GOEL AND WEMIMO Of Esusu want to prove investing in minority businesses isn’t charity.

tests sparked conversations about inequality in the tech industry. Industry leaders pledged to address a lack of diversity, both in the startup founders who receive checks and the venture investors empowered to write them. A survey last year by Deloitte found that about 80% of investment partners in venture capital are white, compared with 3% Black and 4% Latino. The organization BLCK VC has rallied support and partnered with venture firms on a mission to double the number of Black men and women in venture investment to 6% by 2024. “Post-George Floyd, there was an uptick in support for Black founders and empowerment for Black founders [and investors] to go out into the market to raise money,” said Tonna Obaze, chief of staff and an investor at Harlem Capital Partners, a venture firm focused on backing under-represented founders. “One of the things we think about is the story of sustainability. Is the support that we saw starting in 2020 something that has continued?” Harlem Capital Partners last spring raised a $134 million fund toward a mission changing the face of entrepreneurship. The firm has been backing under-represented startup founders in New York and

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CLASSIFIEDS CLASSIFIEDS

Advertising Section Advertising Section

To place a classified ad, Call 212-210-0189 Contact Claudia Hippel at 312-659-0076 or email: claudia.hippel@crain.com or Email: classifieds@crainsnewyork.com

INVITATION TO BID

Invitation to Prequalify and to Bid Rehabilitation and Flood Mitigation of the New York Aquarium, Brooklyn, NY: Turner Construction Company, an EEO Employer, is currently soliciting bids for the Rehabilitation and Flood Mitigation of the New York Aquarium from subcontractors and vendors for the following bid packages: BP #057– Existing Conditions Scan to BIM Services (Bid, Payment & Performance Bond Required) BP #053 – Security/Fire Watch Services (Bid, Payment & Performance Bond Required) BP #058 – Temporary Sanitary Facilities (Bid, Payment & Performance Bond Required) BP #047 – Tile Flooring (Bid, Payment & Performance Bond Required)

PUBLIC & LEGAL NOTICES Notice of Formation of CAPE GRAVITY, LLC Arts. of Org. filed with Secy. of State of NY (SSNY) on 11/19/21. Office location: NY County. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to Brian Orlando, 350 Bleecker St., Apt. 6X, NY, NY 10014, regd. agent upon whom and at which process may be served. Purpose: Any lawful activity.

BP #049 – Mirrors & Glazing (Bid, Payment & Performance Bond Required) Only bids responsive to the entire scope of work will be considered and, to be successful, bidders must be prequalified by Turner. Certified M/WBE and Small Business (13 CFR part 121) companies are encouraged to submit. In order to receive the bid packages, potential bidders either (1) must initiate the prequalification process by submitting a Subcontractor/Vendor Prequalification Statement to Turner, or (2) must be prequalified based on a prior submission to Turner. (Note: Prior prequalification submissions that remain current will be considered as previously submitted or may be updated at this time.) All bidders must be prequalified by the bid deadline: March 7th, 2022 and initial submission of a prequalification statement not later than March 7th, 2022 is strongly encouraged. All bidders must have an acceptable EMR, and will be subject to government regulations such as 44 CFR and Federal Executive Order 11246. Successful bidders will be required to use LCP Tracker compliance verification software. Note that while this is a New York City prevailing wage project, union affiliation is not required for BP #057, #053, #058, #0447 or #049. A Webcast about the above Bid Package/s will be held on February 11, 2022. Attendance is optional for all; the Webcast is designed to assist potential M/WBE subcontractors/vendors. Link: Please join this meeting from your computer, tablet or smartphone.

https://teams.microsoft.com/l/meetupjoin/19%3ameeting_NDJmNmIxYjktODNiOC00NjZjLTllZDMtZjhhMDdjNDUwNmM5%40thread.v2/0?context=%7b%22Tid%22%3 a%2220e27700-b670-4553-a27c-d8e2583b3289%22%2c%22Oid%22%3a%22732a90ce-24b7-42eb-bf78-d638e2a629ac%22%7d

To obtain further information about contracting opportunities and/or the prequalification package and bid solicitation package/s, please contact Dolores Wooden, lspangel@tcco.com 646-842-1659. The date for the virtual public opening at the Turner Construction Company office located at 375 Hudson Street, New York, New York, is March 8th, 2022 9 AM

ESRT MV Swap Victory Owner, L.L.C. Authority filed SSNY 11/29/21. Office: NY Co. LLC formed DE 9/28/21. Exists in DE: c/o Corporation Service Company, 251 Little Falls Dr., Wilmington, DE 19808. SSNY designated agent upon whom process against the LLC may be served & mail to: c/o Corporation Service Company, 80 State St., Albany, NY 12207. Cert of Formation Filed: Jeffrey W. Bullock, DE Secy. of State, Townsend Bldg., 401 Federal St., Ste. 3, Dover, DE 19901. General Purpose.

Link: Please join this opening meeting from your computer, tablet or smartphone.

https://teams.microsoft.com/l/meetupjoin/19%3ameeting_MDI0Mzk3MWUtYmE0Mi00Y2MxLTg0ZmQtYWIyYWMyNjgwZjli%40thread.v2/0?context=%7b %22Tid%22%3a%2220e27700-b670-4553-a27c-d8e2583b3289%22%2c%22Oid%22%3a%22732a90ce-24b7-42ebbf78-d638e2a629ac%22%7d

POSITION AVAILABLE Senior Associate (Apollo Management Holdings, L.P. – New York, NY) Serve as part of a team that makes investments in businesses in the financial svcs sector. Investments include taking majority ownership of lending businesses, insurance comps. and other financial svcs businesses, as well as min. ownership, debt investments and asset purchases. F/T. Resumes: to Taylor Rackover at trackover@apollo.com. JobID: 6045506.

REQUEST FOR PROPOSAL The Wildlife Conservation Society, RFP for A/E & Const. Mgt. Bronx Zoo, 2300 Southern Blvd. Bronx NY 10460 Solicitation Due 3-8-22 at 5:00 p.m. bids@wcs.org Walkthrough 2-22-22 To request the Solicitation Email Allan Howell ahowell@wcs.org

Contact Claudia Hippel at 312-659-0076 or email: claudia.hippel@crain.com

PUBLIC & LEGAL NOTICES

Notice of Qualification of Impactive Solutions, LLC. Authority filed with Secy. of State of NY (SSNY) on 12/14/21. Office location: NY County. LLC formed in Georgia (GA) on 02/09/18. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to: Registered Agent Solutions, Inc., 99 Washington Ave. Ste. 1008, Albany, NY 12260. Principal office address: 301 E Lamar St #6, McKinney, TX 75069. Arts of Org. filed with the Secy. of State, State of GA Secy. of State Corporate Division, 313 West Tower, 2 Martin Luther King, Jr. Dr., Atlanta, GA 30334-1530. Purpose: any lawful activities.

Notice of Qualification of 400 CAPITAL ASSET BASED ONSHORE TERM FUND III L.P. Appl. for Auth. filed with Secy. of State of NY (SSNY) on 12/30/21. Office location: NY County. LP formed in Delaware (DE) on 05/18/21. Princ. office of LP: 510 Madison Ave., 17th Fl., NY, NY 10022. Duration of LP is Perpetual. SSNY designated as agent of LP upon whom process against it may be served. SSNY shall mail process to Corporation Service Co., 80 State St., Albany, NY 12207-2543. Name and addr. of each general partner are available from SSNY. DE addr. of LP: 251 Little Falls Dr., Wilmington, DE 19808. Cert. of LP filed with Secy. of State of the State of DE, 401 Federal St., Dover, DE 19901. Purpose: Any lawful activity.

Notice of formation of Limited Liability Company. Name: Nathan Galinsky Apartments Development LLC (“LLC”). Articles of Organization filed with the Secretary of State of the State of New York (“SSNY”) on December 6, 2021. NY office location: New York County. The SSNY has been designated as agent of the LLC upon whom process against it may be served. The SSNY shall mail a copy of any process to Nathan Galinsky Apartments Development LLC, 641 Lexington Avenue, 15th Floor, New York, NY 10022. Purpose/character of LLC is to engage in any lawful act or activity.

Notice of Formation of CLAMPETT PHYSICAL THERAPY (NY), PLLC. Arts. of Org. filed with Secy. of State of NY (SSNY) on 12/06/21. Office location: NY County. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to: C T Corporation System, 28 Liberty St., NY, NY 10005. Purpose: to practice the profession of Physical Therapy.

ESRT MV Swap Chesapeake Owner, L.L.C. Authority filed SSNY 11/29/21. Office: NY Co. LLC formed DE 9/28/21. Exists in DE: c/o Corporation Service Company, 251 Little Falls Dr., Wilmington, DE 19808. SSNY designated agent upon whom process against the LLC may be served & mail to: c/o Corporation Service Company, 80 State St., Albany, NY 12207. Cert of Formation Filed: Jeffrey W. Bullock, DE Secy. of State, Townsend Bldg., 401 Federal St., Ste. 3, Dover, DE 19901. General Purpose.

Notice of Qualification of J26 LLC Appl. for Auth. filed with Secy. of State of NY (SSNY) on 12/02/21. Office location: NY County. LLC formed in Delaware (DE) on 06/26/20. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to c/o. Corporation Service Co. (CSC), 80 State St., Albany, NY 12207-2543. DE addr. of LLC: c/o CSC, 251 Little Falls Dr., Wilmington, DE 19808. Cert. of Form. filed with Secy. of State, John G. Townsend Bldg., 401 Federal St., Ste. 4, Dover, DE 19901. Purpose: Any lawful activity.

Notice of Qualification of YONKERS PORTFOLIO MEMBER LLC Appl. for Auth. filed with Secy. of State of NY (SSNY) on 12/22/21. Office location: NY County. LLC formed in Delaware (DE) on 05/13/21. Princ. office of LLC: 116 E. 27th St., 11th Fl., NY, NY 10016. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to c/o Corporation Service Co., 80 State St., Albany, NY 12207-2543. DE addr. of LLC: 251 Little Falls Dr., Wilimington, DE 19808. Cert. of Form. filed with Secy. of State, John G. Townsend Bldg., 401 Federal St., Ste. 4, Dover, DE 19901. Purpose: Real estate owner.

Notice of Formation of CPG CSA PRESERVATION PARTNERS LLC Arts. of Org. filed with Secy. of State of NY (SSNY) on 12/08/21. Office location: NY County. Princ. office of LLC: 116 E. 27th St., 11th Fl., NY, NY 10016. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to Corporation Service Co., 80 State St., Albany, NY 12207. Purpose: Real estate.

Notice of Formation of Gomez Personal Custom Prints LLC. Arts of Org filed with Secy of State of NY (SSNY) on 10/10/21. Office location: NY County. SSNY designated as agent upon whom process may be served and shall mail copy of process against LLC to 429 Orchard St, Englewood, NJ 07631. R/A: NY Registered Agent LLC, 90 State St, Ste 700, Ofc 40, Albany, NY 12207. Purpose: any lawful act.

ESRT Victory Owner, L.L.C. Authority filed SSNY 11/29/21. Office: NY Co. LLC formed DE 9/28/21. Exists in DE: c/o Corporation Service Company, 251 Little Falls Dr., Wilmington, DE 19808. SSNY designated agent upon whom process against the LLC may be served & mail to: c/o Corporation Service Company, 80 State St., Albany, NY 12207. Cert of Formation Filed: Jeffrey W. Bullock, DE Secy. of State, Townsend Bldg., 401 Federal St., Ste. 3, Dover, DE 19901. General Purpose.

Notice of Formation of 136 WINCHESTER LLC Arts. of Org. filed with Secy. of State of NY (SSNY) on 12/06/21. Office location: NY County. Princ. office of LLC: 98 Anderson Rd., Kent, CT 06757. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to the LLC, Attn: Lewis Hart at the princ. office of the LLC. Purpose: To purchase, own and sell real estate in New York.

Notice of Application for Authority of FLLC: Tinicum Venture Partners I GP LLC Application for Authority of FLLC filed with SSNY: 12/10/2021. The jurisdiction of the co. is DE, it was formed on 11/22/2021. Office location in NYS, NY County is 800 3rd Ave. 40th flr, NY, NY 10022. SSNY desig. as agent of the FLLC upon whom process against it may be served. SSNY can mail process to c/o Tin. Enter. Inc. 990 Stewart Ave, Ste 580, Garden City, NY 11530. The address of the principal office of the Co. in DE is 1209 ORANGE STREET, WILMINGTON, DE 19801. Name & address of the auth. officer in DE where a copy of the Articles of Organization of the FLLC is filed at SOS JEFFREY W. BULLOCK, 401 FEDERAL STREET, STE 4 DOVER, DE 19901. Purpose of company is any lawful activity.

Notice of Qualification of ESNY BEACON LLC. Appl. for Auth. filed with Secy. of State of NY (SSNY) on 01/05/22. Office location: NY County. LLC formed in Florida (FL) on 08/29/19. Princ. office and FL addr. of LLC is: 900 5th Ave. South, Ste. 202, Naples, FL 34102. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to c/o Corporation Service Co., 80 State St., Albany, NY 12207-2543. Cert. of Form. filed with FL Secy. of State, 500 S. Bronough St., Tallahassee, FL 32399. Purpose: Investments for profit of a general nature, including real estate, land, closely held business entities, and any other lawful business activity allowed by law.

Notice of Qualification of DOUP PARTNERS LLC. Appl. for Auth. filed with Secy. of State of NY (SSNY) on 01/13/22. Office location: NY County. LLC formed in Delaware (DE) on 09/17/21. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to c/o Corporation Service Co., 80 State St., Albany, NY 12207-2543. DE addr. of LLC: 251 Little Falls Dr., Wilmington, DE 19808. Cert. of Form. filed with Secy. of State, 401 Federal St., Ste. 3, Dover, DE 19901. Purpose: Any lawful activity.

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CLASSIFIEDS CLASSIFIEDS

Advertising Section Advertising Section

To place a classified ad, Call 212-210-0189 Contact Claudia Hippel at 312-659-0076 or email: claudia.hippel@crain.com or Email: classifieds@crainsnewyork.com

PUBLIC & LEGAL NOTICES Notice of formation of Limited Liability Company. Name: Nathan Galinsky Apartments Preservation Management LLC (“LLC”). Articles of Organization filed with the Secretary of State of the State of New York (“SSNY”) on December 6, 2021. NY office location: New York County. The SSNY has been designated as agent of the LLC upon whom process against it may be served. The SSNY shall mail a copy of any process to Nathan Galinsky Apartments Preservation Management LLC, 641 Lexington Avenue, 15th Floor, New York, NY 10022. Purpose/character of LLC is to engage in any lawful act or activity.

Notice of formation of Limited Liability Company. Name: Nathan Galinsky Apartments Preservation LLC (“LLC”). Articles of Organization filed with the Secretary of State of the State of New York (“SSNY”) on December 6, 2021. NY office location: New York County. The SSNY has been designated as agent of the LLC upon whom process against it may be served. The SSNY shall mail a copy of any process to Nathan Galinsky Apartments Preservation LLC, 641 Lexington Avenue, 15th Floor, New York, NY 10022. Purpose/character of LLC is to engage in any lawful act or activity.

Notice of Qualification of Fulton RE Holdings LLC. Authority filed with Secy. of State of NY (SSNY) on 12/14/21. Office location: NY County. LLC formed in Delaware (DE) on 12/01/21. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to: Ilyse Dolgenas, Esq., Withers Bergman LLP, 430 Park Ave., 10th Fl., NY, NY 10022. Address to be maintained in DE: 1209 Orange St., Wilmington, DE 19801. Arts of Org. filed with the DE Secy. of State, Division of Corporations, John G. Townsend Bldg., 401 Federal St., Ste. 4, Dover, DE 19901. Purpose: any lawful activities.

Notice of Qualification of 400 CAPITAL JSIF IV GP LLC. Appl. for Auth. filed with Secy. of State of NY (SSNY) on 12/30/21. Office location: NY County. LLC formed in Delaware (DE) on 06/11/21. Princ. office of LLC: 510 Madison Ave., 17th Fl., NY, NY 10022. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to c/o Corporation Service Co., 80 State St., Albany, NY 12207-2543. DE addr. of LLC: 251 Little Falls Dr., Wilmington, DE 19808. Cert. of Form. filed with Secy. of State of the State of DE, 401 Federal St., Dover, DE 19901. Purpose: Any lawful activity.

Notice of Qualification of DERBY BLISS 68, LLC. Appl. for Auth. filed with Secy. of State of NY (SSNY) on 01/14/22. Office location: NY County. LLC formed in Delaware (DE) on 11/24/21. Princ. office of LLC: 41 Madison Ave., 40th Fl., NY, NY 10010. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to c/o Corporation Service Co., 80 State St., Albany, NY 12207-2543. DE addr. of LLC: 251 Little Falls Dr., Wilmington, DE 19808. Cert. of Form. filed with Secy. of State, 401 Federal St., Dover, DE 19901. Purpose: Investing.

NOTICE OF FORMATION OF Eugene Business Consulting, LLC. Articles of Organization filed with the Secretary of State of NY (SSNY) on 09/27/2021. Office location: NEW YORK County. SSNY has been designated as agent upon whom process against it may be served. The Post Office address to which the SSNY shall mail a copy of any process against the LLC served upon him/her is: 8711 92nd Street, Woodhaven NY 11421. The principal business address of the LLC is: 8711 92nd Street, Woodhaven NY 11421. Purpose: any lawful act or activity.

NOTICE OF FORMATION OF ANNA WEISS, P.L.L.C. Arts. of Org. filed with Secy of State of NY (SSNY) on 2/7/19. Office: NY County. SSNY designated as agent upon whom process may be served. SSNY shall mail copy of process against PLLC to 200 Rector Pl 12B, NY, NY 10280. Purpose: Any lawful act.

Notice of formation of Konisan (NY), LLC, file with SOS of NY on 12/13/21. Loc in NY County, designed as agent upon whom process may be served SSNY, shall mail process to 600 Mamaroneck Ave #400, Harrison, NY 10528. Purpose: any lawful activity.

Notice of formation of Limited Liability Company name: Walker 5, LLC Art. Of Org. Filed Sec. of State of NY 06/07/2017. Off. Loc.: Richmond Co. SSNY designated as agent upon whom process against it may be served. SSNY to mail copy of process to The LLC, 209 Granite Ave Staten Island NY. Purpose: Any lawful act or activity.

Notice of formation of Limited Liability Company name: Walker 89, LLC Art. Of Org. Filed Sec. of State of NY 05/19/2016. Off. Loc.: Richmond Co. SSNY designated as agent upon whom process against it may be served. SSNY to mail copy of process to The LLC, 209 Granite Ave Staten Island NY. Purpose: Any lawful act or activity.

Off The Rip LLC Arts. of org. filed with NY Secy. of State (SSNY) on 9/16/20. Office location: NY County. SSNY designated as agent of LLC upon whom process may be served. SSNY shall mail process to:105 West 125th Street #1048 NY, NY 10027. Purpose: any lawful activity.

Notice of Qualification of CITY WINERY GRAND CENTRAL, LLC Appl. for Auth. filed with Secy. of State of NY (SSNY) on 12/13/21. Office location: NY County. LLC formed in Delaware (DE) on 11/08/21. Princ. office of LLC: 25 11th Ave., NY, NY 10013. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to c/o Corporation Service Co. (CSC), 80 State St., Albany, NY 12207. DE addr. of LLC: c/o CSC, 251 Little Falls Dr., Wilmington, DE 19808. Cert. of Form. filed with Secy. of State, Div. of Corps., John G. Townsend Bldg., 401 Federal St., Dover, DE 19901. Purpose: Any lawful activity.

Notice of Qualification of KINOKO LOGISTICS, LLC Appl. for Auth. filed with Secy. of State of NY (SSNY) on 12/02/21. Office location: NY County. LLC formed in Delaware (DE) on 02/04/14. Princ. office of LLC: 100 Ave. of the Americas, 16th Fl., NY, NY 10013. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to the LLC at the princ. office of the LLC. DE addr. of LLC: c/o Corporation Service Co., 251 Little Falls Dr., Wilmington, DE 19808. Cert. of Form. filed with DE Secy. of State, John G. Townsend Bldg., 401 Federal St., Ste. 4, Dover, DE 19901. Purpose: Any lawful activity.

Notice of Qualification of 83LEONIS LLC. Appl. for Auth. filed with Secy. of State of NY (SSNY) on 01/07/22. Office location: NY County. LLC formed in Delaware (DE) on 11/29/21. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to Ajaypal Singh Banga, 875 5th Ave., Apt. 19A, NY, NY 10065. DE addr. of LLC: 251 Little Falls Dr., Wilmington, DE 19808. Cert. of Form. filed with Secy. of State, Div. of Corps., John G. Townsend Bldg., 401 Federal St., Ste. 4, Dover, DE 19901. Purpose: Any lawful activity.

Notice of Qualification of RADIO RESTAURANT, LLC. Appl. for Auth. filed with Secy. of State of NY (SSNY) on 12/27/21. Office location: NY County. LLC formed in Delaware (DE) on 12/02/21. SSNY designated as agent of LLC upon whom process against it may be served. SSNY shall mail process to Youngwoo & Associates, LLC, 545 W. 25th St., 8th Fl., NY, NY 10001. DE addr. of LLC: c/o Corporation Service Co., 251 Little Falls Dr., Wilmington, DE 19808. Cert. of Form. filed with DE Secy. of State, Div. of Corps., 401 Federal St., Dover, DE 19901. Purpose: Any lawful activity.

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FEBRUARY 14, 2022 | CRAIN’S NEW YORK BUSINESS | 21

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FROM PAGE 3

“The inspiration in 2019 was just ‘Hey, let’s get out of the four walls of a conference room, meet up outdoors and get some exercise,’ ” said Mehta, a founding general partner at Eniac Ventures, an early stage investment firm with an office in SoHo. Mehta found that jogging offered a chance for a more natural, two-way conversation than giving

a presentation inside a conference room. When Covid-19 took hold of the city nearly two years ago, Pitch and Run took on a new meaning for its regulars. Tejpaul Bhatia, its co-founder and the chief revenue officer at Axiom Space, said the meetups provided him both exercise and much-needed interaction with peers. Carrying on conversations made the miles go quickly, he added. The group keeps a pace slow enough to allow for that conversation—and a cardio-averse news reporter to keep up. “We want it to be as inclusive as possible,” Mehta said. But there’s more to it than networking. “A big part of this is just the fun of running through New York City,” he added. “We all live here for a reason, but we can often forget how amazing this city is.”

TWITTER

‘Eager to help’

“BEST-CASE SCENARIO, YOU SHOW UP AND MAKE CONNECTIONS FOR A JOB”

Avantika Daing, a managing partner at Plum Alley Investments, said the group provides a way to discuss where the technology industry is going—whether web3 or space-tech—and hear from founders about their passions. “There is a true authenticity,” said Daing, whose firm invests in advanced technology startups with gender-diverse founding teams. “This is a community that is collaborative and eager to help.” Jogging groups, in general, have grown in popularity during the

@PITCHANDRUNNYC

PITCH

SWEAT EQUITY: The group meets at 9 a.m. every Monday, Wednesday and Friday for a 4-mile loop along the Hudson River Greenway, promoted on the Pitch and Run NYC Twitter account. pandemic, as the Financial Times recently reported. Strava, a social network for joggers, grew its active users from 73 million in 2020 to 95 million in 2021, with joggers logging 26% more miles overall last year. “Best-case scenario, you show up and make connections for a job, make a friend,” said Kevin Weatherman, a Pitch and Run co-founder. “Worst-case scenario, you got a workout.” Weatherman is an angel investor who wrote early checks to fast-growing startups, such as At-

tentive and Electric. He said the running sessions give him time to offer advice to founders, even if their startup does not fit within his investing focus. “Instead of an email back stating that this does not fit my thesis, I’m going to spend 10 to 30 minutes giving you detailed feedback on your idea and what angel investors are looking for,” Weatherman said.

Branching out Of course, there are still plenty of ways to pitch investors—including the Pitch and Run regulars—

that don’t involve aerobic exercise. And the in-person networking and pitching events that started to trickle back last summer are returning to the calendar more steadily as the surge from the omicron variant wanes. But Mehta said Pitch and Run will continue, and he hopes to see it grow. The running sessions have been scheduled in Miami as well. This is not a money-making venture, Mehta said, but “purely about connecting entrepreneurs and investors and eliminating loneliness during the pandemic.” ■

2022

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22 | CRAIN’S NEW YORK BUSINESS | FEBRUARY 14, 2022

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SMALL- BUSINESS SPOTLIGHT

BUCK ENNIS

PUBLIC GOODS’ Hirsh and Breen say not selling their products on Amazon boosts the local boutiques that stock the brand.

FOCAL POINTS

A one-stop shop for companies and customers

FOUNDED 2017

Public Goods leverages its hospitality accounts to grow its consumer e-commerce business BY CARA EISENPRESS

n 2017 Morgan Hirsh helped launch Public Goods as a source for everyday essentials such as shampoo and toothbrushes that were a step up from the offerings on typical drugstore shelves. At the same time, like many companies in the e-commerce sector, Public Goods wanted to develop a physical relationship with its customers so that potential buyers could touch and try the products before buying them, especially because part of the play was to present high-quality and sustainable offerings in simple, well-designed packaging. Rather than following the playbook of a certain type of startup—signing a lease or at least trying out a pop-up downtown or in Brooklyn—Public Goods, based on the Lower East Side, approached the market as a wholesaler, partnering with boutiques and then a new ilk of distributor to land its wares in restaurant bathrooms, hotel lobbies, coworking spaces and Airbnb rental kitchens. “WeWork reached out early on, and I thought they were trying to throw us a bone as broke entrepreneurs,” Hirsh said. Public Goods was based out of a WeWork shared space at that point. But it turned out to be a practical ask. WeWork, which ultimately gave the contract to another company, had sought out Public

Goods for the cohesive quality of its strippeddown branding across categories. Hirsh took note. Eventually, Public Goods got a business account that it did close, and that’s when it noticed something interesting: Each placement in a hospitality venue led to a lot more direct-to-consumer sales for the company. “We are seeing it create a flywheel effect,” explained Chris Breen, Public Goods’ head of partnerships. “Business-to-business sales were a touch point for new customers that got us inbound leads.” In other words, someone who had never heard of the company might rent an Airbnb in the Hudson Valley with friends, use the face wash and brew the coffee stocked on site, and then try out their own personal Public Goods membership when they return home. Moreover, if an employee of a firm that stocks the kitchen with Public Goods items then signs up for a personal account, that’s “free traffic,” said Hirsh—or a customer they do not need to spend any marketing money to acquire.

Growing optimism That insight helped hone Public Goods’ approach as the number of items it sells rapidly expanded to 300, in all kinds of categories, from groceries and pet food to household cleaners and vitamins. The company

has 800 business accounts, though some are with firms that distribute to multiple partners; the full number of partners is over 1,500. In October sales for the business-to-business line beat consumer sales for the first time ever. That has led to optimism about how fast Public Goods can continue to grow, said Hirsh. He is currently working to get the item count up toward 3,000. “I’d like to build a place where members say, ‘I need X for my house, and I bet Public Goods has it. Let me go there,’ ” he said. “We give them peace of mind knowing that if it is a household essential, we will have it.” In turn, that means revising the buying experience so that customers don’t get overwhelmed by the assortment but instead can find exactly what they need, even among such a vast array of stuff. Hirsh credited relationships with small to midsize family-owned manufacturers around the world with the ability to produce the right quality item for Public Goods. On the other end, he said, not selling on Amazon is a boon to the local city boutiques that carry his wares, because it allows them to sell differentiated products that customers can’t simply reorder with their Prime account. “We stumbled into being a design-forward company,” said Breen, “and in New York specifically, there is a big community of people

FULL-TIME EMPLOYEES 70. The majority of full-time roles are based on the Lower East Side, but some are remote. CO-FOUNDERS Morgan Hirsh and Michael Ferchak CAN’T BUY LOVE Breen said Public Goods has built up something you can’t pay for: trust. “The customers give us full autonomy to launch new products,” he said. Customers who usually buy pet food and hand soap have been happy to hop on ramen or canned tuna upon launch, he said. DOUBLE THE MONEY Hirsh said it was hard at first to convince manufacturers to take a chance on a startup. But now that the firm’s revenue is doubling annually, the relationships are easy to manage. “If they want new business, they’d have to get two accounts to take the place of an account that doubles every year,” he said. REVENUE Revenue in January 2021 was triple that of January 2020; membership doubled during this period, according to Hirsh. MEMBERSHIP Well over 100,000 members, who each pay $79 per year to buy from Public Goods WEBSITE publicgoods.com

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