There was once a time when young would-be entrepreneurs flocked to New York for the riches of finance or retail, or the excitement of media and fashion. Today, the start-up Internet boom has officially made technology New York’s sexiest sector. In this afternoon panel with some of the most prominent figures in the start-up scene, media columnist of the New York Times David Pogue asked exactly what New York has to offer.

Dennis Crowley, CEO of Foursquare, treats New York like his own personal research lab, where he has tested out ideas for the past ten years. “What is the magic sauce that makes people want to use these things we are building?” he asks. “The diversity of New York makes it the best lab to test these things not just for early adopters but for real people who are going to use it.”

In addition to New York’s diversity, its strong “creative class” is another magnet for start-ups. “There’s a dense environment of creativity here. Boston suffers from being overly academic and engineering heavy, while it is design and culture light,” explained venture capitalist Fred Wilson, whose Union Square Ventures has invested in many of the world’s most successful start-ups like Zynga, Meet-Up, Tumblr and Twitter. “There has always been a lot of entrepreneurship here. People get out of college and want to go to New York, which attracts the best and brightest.” Joel Spolsky, CEO of Stock Overflow, agreed that Seattle and Silicon Valley can be culture consumers not creators, and that creativity is in the New York genes.

Nora Abousteit, Co-Founder of BurdaStyle, articulated another reason why the time has come for New York, second now only to Silicon Valley for tech start-ups based on information and social media: “Technology now is horizontal, not vertical. So if you merge the industry with the technology (which is cheap due to the cloud, etc.), you can reinvent the industries. Technology doesn’t need to be near technology anymore. In New York, it can be now be near fashion, near media, etc.”

But Hilary Mason, chief scientist of the leading URL shortener bit.ly, was quick to point out that “the tech boom in New York didn’t just happen. A lot of work has gone into building a community here for start-ups by Fred Wilson and others.” What most of the panelists agree upon is that the local government did not have a big role in pumping the start-up blood now flowing in New York. Spolsky went as far as to say “I don’t know a single entrepreneur who has benefited from a government program.” But as Crowley noted, “it just raises the level of awareness for the mayor and the Bloomberg administration to pay attention.”