Startup Guide: Chicago


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Guide to the Chicago startup community for entrepreneurs, investors, and others.

[Updated January 2014]

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Startup Guide: Chicago

  1. Startup Guide: Chicago Compiled by Adam London + Marina Dedes @al0nd0n // @marinadedes // @lightbank Photo credit: The Chicago Neighborhood Project
  2. Startup Guide; Chicago Let’s start with a few quotes to set the tone I think Chicago could be a great place for building bootstrap companies; longterm companies; companies that are focused on selling stuff – revenues and profits. That represents the City of Big Shoulders, the Midwest, the whole ethos here. - Jason Fried (Founder & CEO 37Signals) Unlike New York, and its connection to the financial sector or Los Angeles with the entertainment sector, Chicago’s economy is built on its diversity. That allows us to be a world leader in many different areas all at once. - Mayor Rahm Emanuel There are enough successes now in our community that young entrepreneurs can look at those successes and say to themselves I can absolutely do it here, I can do it here in a unique way that I probably couldn't do it on the West Coast, and time to go, let's do it. - Brad Keywell
  3. Startup Guide; Chicago Who we are Adam London @al0nd0n Associate at Lightbank Associate at the Boston Consulting Group §  Founder: Letters to Success (education-focused, non-profit) and @TheLunchRead §  University of Michigan’s Organizational Studies Program §  VentureUP and Chicago Tech Academy Launch boards §  §  Marina Dedes @marinadedes VP at Lightbank Senior Associate at Duff & Phelps B.S. Materials Science and Engineering, University of Illinois at Urbana-Champaign §  Chicago Tech Academy’s Launch Advisory Counsel, 1871 Mentor, VentureUp §  Junior Board of Lawrence Hall Youth Services §  §  § 
  4. Startup Guide; Chicago The Table of Contents A note to start Over the past decade, the Chicago startup community has seen incredible growth. More than ever, it’s possible to build a business anywhere and Chicago has become a uniquely vibrant tech community. The Windy City has a phenomenal combination of talent, experience (larger startups / corporations), and financing and service providers. We’re often asked (by visiting investors, recent college graduates, new founders) for advice navigating the growing Chicago community. This interest intensified in recent years with three highly visible—nearing a billion dollars each—liquidity events (Groupon, Grubhub, and Braintree). " The following is an attempt to write all that navigational information down. While we tried to be exhaustive, many wonderful people, companies, and places will surely be left out. We hope to revisit, revise, and update the guide as the community continues to grow. -Adam and Marina Startup Guide: Chicago by Section 1) About the Windy City A bit of background information on the history of the city / tech community and the current state of the market. 2) Who’s here? A guide to the startups actively building businesses here - who they are and where they work. 3) Where to start? A collection of lists highlighting things to know when getting involved with the community or starting a business—places to learn, collaborate, study, and build, etc. 4) How will we scale? The angels, VCs, and large companies (strategic investors, strong corp dev groups, etc.) who call Chicago home.
  5. Section 1: About the windy city Photo credit: The Chicago Neighborhood Project
  6. Startup Guide; Chicago History of innovation and technology Many people remember the Great Chicago fire for the destruction it caused. In reality, after the 1871 fire, architects and entrepreneurs flocked to Chicago to rebuild the city. Centrally located, the city was a major transportation hub and center of business for agriculture, trading, and industrial goods companies. Case Study: Chicago has deep roots in technology In 1928, the Galvin Manufacturing Corporation (now, Motorola) began making radiorelated products, including the first walkie-talkie and the first commercially successful car radio. Following the success of the Motorola Radio, the company went public in 1943. In 2012, it was acquired by Google for $12.5b
  7. Startup Guide; Chicago A community that builds Chicago has always built big companies And many big Chicago businesses have roots in tech -  Illinois is home to 30+ Fortune 500 companies (4th behind California, Texas, and New York) -  Many of those Fortune 500 companies are located in the heart of downtown Chicago: ‘The City That Works’ { A few examples… }
  8. Startup Guide; Chicago Snapshot of the market $391m raised from VCs and angels in 2012 59 companies raised >$1m in 2012, a 34% increase over 2011 50+ VC firms outside of Chicago invested in local companies A peak at 2013, a year of incredible growth. In Q3 of 2013… 26 acquisitions Exits Funding Built In Chicago’s 2012 Digital Startup Report: 1 IPO $698m+ from exits with disclosed dollar amounts §  39 companies raised $265m, incl. Cleversafe’s $55m Series D §  44 new startups founded, 4 companies acquired §  $864m dollars in exits (led by Braintree’s $800m exit to Ebay) According to Built in Chicago, 367 startups launched in Chicago in 2012—that’s 1 every 24 hours. 40,000 people work for 1,500+ digital companies in 2013, an increase of 21% over 2012. Mayor Rahm Emanuel wants to double that number.
  9. Startup Guide; Chicago A link to the Midwest Often referred to as Silicon Prairie, the Midwest has a booming startup ecosystem. Chicago is located at the center of many great Midwestern cities committed to growing innovation and technology. Madison Milwaukee Ann Arbor Minneapolis Detroit Omaha Columbus Des Moines Kansas City St. Louis A sample view of a few startup friendly funds, co-working spaces, accelerators, etc. scattered throughout the Midwest… Cincinnati
  10. Section 2: Who’s here? Photo credit: The Chicago Neighborhood Project
  11. Startup Guide; Chicago A few notable (or, sizable) Chicago companies + exits
  12. Startup Guide; Chicago A few Chicago companies on the rise (look out for the next exit) Note: An advantage to being part of a fast-moving industry and quickly growing tech community is that startups are launched (and gain significant traction) every day. This list is just a glimpse into a few of those companies that are known to have achieved impressive metrics and / or raised significant financing.
  13. Startup Guide; Chicago Case studies: Deep dive on a few companies on the rise Note: We picked two companies to profile so that you wouldn’t have to stare at logos all day. Obviously, we’re slightly biased and know a few of these better as investors but tried to pull information together only based on public sources. §  §  §  §  §  §  Sprout Social was founded in Chicago in 2010 as a, ‘management and engagement platform for social business’ Software is used by leading international brands, such as: McDonalds and Yahoo! Series A from Chicago investors (Lightbank), then raised a $10m Series B from NEA BrightTag was founded in Chicago in 2009 and is a leading marketing technology platform, allowing brands to connect and act on cross channel customer data Named one of 2011’s 50 most innovative tech co’s by Venture Wire / Dow Jones Raised money from local + other investors: Pritzker Group, TomorrowVentures, Baird Capital, I2A, EPIC Ventures, and Yahoo Japan!
  14. Startup Guide; Chicago A glimpse at more great teams currently building in the Windy City Pro-tip: Check out Built in Chicago, Crafted in Chicago, or Crunchbase for frequently updated lists of Chicago startups.
  15. Startup Guide; Chicago Where do all these startups work? Spotlight on: two neighborhoods—River North and the West Loop—with growing tech communities §  The stretch of the Brown Line (from Merch Mart to Chicago) is home to many Chicago startups / co-working spaces §  1871, Starter League, Chicago Ventures, and Motorola Mobility call the Merch Mart home §  Spot Hero, Trunk Club, and countless others are spread along the Brown line §  Groupon, Lightbank, and many early stage co’s are based out of 600W near the Chicago stop §  Google announced move to former cold storage warehouse by 2015 §  Home to: Threadless, Sandbox Industries, Crowdspring Map courtesy of Built In Chicago
  16. Section 3: Where to start? Photo credit: The Chicago Neighborhood Project
  17. Startup Guide; Chicago Getting to know the community through events For many folks, events / organizations / meet-ups / etc. function as a great starting point to understand a community. The Chicago startup community is powered by, but much larger than, the entrepreneurs and teams building great products and businesses. The following is a glimpse at a few of the key organizations and events in the community—a starting spot for those looking for ways to learn more, get involved for the first time, or build deeper relationships in the Windy City à Events §  §  §  §  §  §  §  Technori Pitch §  Entrepreneurs Unplugged 1871 Chicago Founder Stories §  §  TechWeek §  Chicago Ideas Week §  StartupWeekend Chicago ITA CityLights §  Built In Chicago Launch §  Uncubbed §  Social Media Week Health 2.0 CUSP Meet ups, + other groups §  §  §  §  §  Chicago Tech Meetup Tech in Motion ChicagoRuby TechCocktail Built In Chicago Refresh Chicago Chicagoland Entrepreneurial Center (CEC) Illinois Technology Association Illinois Venture Capital Association §  §  §  §  §  Moxie Awards Momentum Awards Chicago Innovation Awards
  18. Startup Guide; Chicago Where to learn (on getting a tech education in Chicago) So you want to building something? Chicago has an abundance of places / resources to help you out at the earliest stages – the following is our round-up broken down into phases: 1) Education 2) Ideation 3) Incubation - Polsky Center for Entrepreneurship and Innovation - Chicago Innovation Exchange Tech in traditional centers of education: - Health, Technology, & Innovation - Enterprise Works - UI Labs - ‘The Garage’ - Innovation Center - Learn to code, design, and ship web apps at this beginner-focused software school (ft. classes in: HTML/ CSS, JavaScript, Ruby, Visual design, UX design) Education “Where to learn” - 10 week digital design school focused on UX, visual design, and front-end development, (HTML/CSS/JS) New school programs: - ‘Career accelerator’ helping students gain the skills, mindset, and network to success in startups (ft. tracks in sales, technical marketing, web dev., product / design) - ‘Full-time, 8-week iOS bootcamp to start careers as an iOS developer - ‘9-week intensive program teaching professional web development using Ruby on Rails
  19. Startup Guide; Chicago Where to think (or, a list of great early stage work environments) So you want to building something? Chicago has an abundance of places / resources to help you out at the earliest stages – the following is our round-up broken down into phases: 1) Education 2) Ideation 3) Incubation Co-working spaces Ideation “Where to think” A list of some of our favorite, Wifi-providing coffee shops in Chicago. A more casual atmosphere (aka the coffee shop) NextDoor (Lakeview) Dollop (Multiple) Heritage General Store (Lakeview) Buzz Kill (Wicker Park) Wormhole (Wicker Park) Caffe Streets (Wicker Park) Intelligentsia (Multiple) Star Lounge (Humbolt Park)
  20. Startup Guide; Chicago Where to build (early stage incubators and accelerators) So you want to building something? Chicago has an abundance of places / resources to help you out at the earliest stages – the following is our round-up broken down into phases: 1) Education 2) Ideation 3) Incubation Searching for a Chicago-based incubator to accelerate your company / idea? Here are a few ideas of local incubators and accelerators. Incubation “Where to build”
  21. Startup Guide; Chicago Resources to help your company grow (part 1) Now that you’ve started building a product or business, you might need a bit of help. The following are a few serviced providers we’ve used at Lightbank. (Law) (HR) (Accounting) (Insurance) (Hardware) And as that business grows, you’ll likely need to find (more) talent. In addition to Lightbank’s internal talent scout, we’ve seen the following agencies recruit employees for strong startups across Chicago. Tech / Design-centric recruiting Technology and General recruiting (We have an in-house talent team – so if you’re looking for a job: reach out!)
  22. Startup Guide; Chicago Resources to help your company grow (part 2) As you grow, you’ll want to get the word out. Here are a few Chicago-specific tech publications. Contact: John Pletz Contact: Amina Elahi Contact: James Janega Contact: Matt Present And if you need help reaching out to, or strategizing about, media outreach – here are a few local, tech PR firms. Early-stage PR agencies Later stage (or bigger budget) agencies
  23. Section 3: How to scale? Photo credit: The Chicago Neighborhood Project
  24. Startup Guide; Chicago A non-exhaustive list of Chicago-based sources of capital Angels Seed Series A & B Growth
  25. Startup Guide; Chicago There’s more to Chicago than (just) early stage tech financing Here are a few examples—and a lot of logos—of larger local companies with active strategic funds, business development groups, and corporate development units.
  26. Questions? Additions? Things that we missed? Reach out à Adam [at] Lightbank + Marina [at] Lightbank Photo credit: The Chicago Neighborhood Project
  27. Startup Guide; Chicago It is hopeless for the occasional visitor to try to keep up with Chicago—she outgrows his prophecies faster than he can make them. She is always a novelty; for she is never the Chicago you saw when you passed through the last time. - Mark Twain (Life on the Mississippi)
  28. Startup Guide; Chicago Sources Big thanks to the entire Lightbank team* for their help, thoughts, and feedback. Also, credit is due to many sources for information used throughout the presentation, including: The Chicago Neighborhood Project, Built In Chicago, Crafted in Chicago, RedRocket Venture Blog, The Economist, Blackline Review, The Chicago Tribune, and Fast Company