Late last year, when the education publishing company Scholastic offered up about 60,000 square feet of sublease space at the top of the Soho office building 568 Broadway, the firm quickly found it wouldn’t be difficult to fill.
Within weeks, a host of tenants were competing for it, including several tech firms, one of the most active sectors of the leasing market in Manhattan right now. Tumblr, foursquare and AppNexus, all well-known names in the industry, moved to the front of the pack.
On the face of it, such a decision would seem easy. Of the three, only AppNexus, a firm that specializes in online advertising and is backed by the software giant Microsoft, is known to be profitable. But in a tech boom in which riches don’t always flow from the most likely sources, the deal for the space took a different turn.
The competition soon boiled down not to AppNexus but to Tumblr and foursquare, two companies that have become top brands in the new internet boom and have raised tens of millions of dollars in venture capital between them, but have yet to find income-producing platforms for their services. Read More