Khosla Ventures Expands to New York This Fall—Marking Its First Location Beyond Sand Hill Road

Keith Rabois has spent most of his 13-year career in venture capital closely tied to Khosla Ventures in Menlo Park, California. However, this is about to change. During his address at TechCrunch’s StrictlyVC event in New York’s West Village on Thursday evening, Rabois announced the establishment of Khosla Ventures’ first office outside of its Sand Hill Road location, set to open this fall on 14th Street in New York.

“It’s actually reportedly under construction now,” said Rabois, who noted some previous delays. “The timeline for this fall feels somewhat uncertain to me.”

This decision is particularly significant given Khosla Ventures’ previous lack of an office in San Francisco. “We don’t even have an office in San Francisco, so this is a landmark move for us,” Rabois remarked.

The new office will accommodate several Khosla investors, including Rabois, but it will also feature an innovative “executive briefing center.” This space will facilitate interactions between 10 to 12 portfolio companies and Fortune 500 firms four days a week. “The portfolio companies appreciate this,” he explained to those attending. “They gain clients and pilot projects, making the office a dynamic environment.”

This announcement follows Rabois’ recent relocation to the East Coast, where he moved to be near his partner, Jacob Helberg, the Under Secretary of State for Economic Growth, Energy, and the Environment, as well as their children, who reside in Washington, D.C.

When asked if he believed New York could rival the talent density of the Bay Area, where he has spent much of his career, Rabois contemplated before responding, indicating that it varies by seniority level.

At the junior level, Rabois was confident. “For entry-level positions, right out of school, definitely,” he said, using Ramp, a fintech startup he frequently invests in, as an example. “We’ve been successful in recruiting fresh graduates and have cultivated a remarkable talent pool from our intern program and beyond.”

However, senior technical recruitment poses challenges. “For senior engineers or high-level architects, that’s a bit tougher,” he admitted, although he noted that modern demands might require fewer such specialists compared to the past.

The real issue for companies, according to Rabois, lies with securing experienced senior executives. He attributed this predicament to geographic and lifestyle preferences rather than a lack of talent. “For firms with an in-office culture, many senior professionals live outside of the city, leading to difficult commutes,” he observed, drawing on his own experiences growing up in a New York suburb. “In my case, commuting from a suburban area was manageable, but others may travel from much further away. Recruiting established executives under an in-office policy has proven quite challenging.”

As a strategy, Ramp has largely avoided this issue by focusing on building teams from the ground up. “We intentionally chose to refrain from hiring senior personnel, fostering talent internally for the last three years,” he explained. “This can be effective, but finding a CFO or a senior VP of sales with extensive experience for a five-day-a-week office commitment is difficult unless they have significant financial resources to support living in the city.”

Khosla’s expansion into New York places it among a limited circle of venture capital firms, several of which have maintained a presence in the city for years, albeit on a smaller scale. Firms like Sequoia Capital and Andreessen Horowitz have New York-based partners, albeit fewer than in their Bay Area teams.

This move also coincides with recent findings from CBRE, a commercial real estate services company, indicating that New York has marginally surpassed the San Francisco Bay Area in total tech talent for the first time in 13 years. This shift has been largely driven by finance companies aggressively seeking AI professionals while tech corporations in the Bay Area reduce their workforce.

Could this be a coincidence? Judging by the audience on Thursday night, many New Yorkers appeared skeptical of the data.

“I came across that study,” one attendee remarked. “I’m not convinced.”