Chicago’s Tech Ecosystem

That’s from Chicago?!

More often than not, when you tell someone that tech market makers like Groupon, Orbitz, CareerBulider, Feedburner, Grubhub or Basecamp came out of Chicago their reply is “That’s from Chicago?!” Guess what? YouTube, PayPal, and Yelp began their lives in Chicago too.

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A new generation of mentorship and venture capital is pumping through the business veins of Chicago, allowing for the city’s tech startups to thrive, and bringing a new wave of talent. Startup accelerators are feeding the pipeline via Excelerate Labs, Healthbox & the Clean Energy Trust to name just a few. And our early stage investment community is on a tear, with vital capital being deployed from experienced venture teams at New World Ventures, Sandbox Industries, Lightbank, Apex Venture Partners and the I2A Fund. In addition to providing access to new sources of capital, they bring with them a stable of entrepreneurial veterans who have deep track records with multiple successful startups through the years on the Chicago scene.

And Chicago’s angel investment community is hitting on all cylinders as well, with a fleet of active and organized investment pros including two of the most prominent -- Hyde Park Angels and Wildcat Angels.

Over the past 15 years there has been more than $8 billion in venture capital invested in Chicago area startups, with an average investment of over $7 million per deal. Even through the economic challenges of 2009, the gross regional product for Chicagoland’s info-tech sector was almost $39 billion, and there were nearly 200,000 IT workers employed at more than 18,000* establishments. And if ever you wondered how big the tech scene really is in Chicago these days, you need not look much futher than www.builtinchicago.org, a web-based watering hole for all things digital in Chicago.  Founded in 2010 by serial entrepreneur and current CEO of Viewpoints, Matt Moog, BuiltInChicago has fast become the “go to” destination for smart, digital professionals seeking to connect with like minds.

And one very public-facing example of what’s going on in Chicago’s startup scene is Groupon, the company that Forbes early on crowned "the fastest growing company ever." In just over two years since its birth, Groupon has attracted a hive of savvy tech talent, putting an exclamation point on an already growing trend that has placed Chicago at the epicenter for a young and hungry digital generation of workers and next gen entrepreneurs. With an impending IPO set for Q4 2011, Groupon has become the poster child for what is in fact an explosion of startup growth in Chicago across the board.

It's no wonder why tech titans like Google, Microsoft, NAVTEQ, and IBM employ thousands of people in Chicago. There's a robust talent-pool for them to tap, often coming out of Chicago's great universities who then have the ability to cut their teeth in the various corners of Chicago’s tech ecosystem.

And let’s not overlook that Chicago is the birthplace and home to monster number of financial tech (fin-tech) leaders and companies.  Included on the roster are Morningstar, Thinkorswim, Infinium Capital Management, GETCO, Jump Trading, and the list goes on. In fact the fin-tech industry that has grown up around Chicago-based CME Group – the world’s largest futures exchange – is likely unmatched on the global stage.

Morningstar and Thinkorswim

Chicago is also home to a vibrant tech-event culture. TECH Cocktail began as a periodic mixer where Chicago-area startups and tech enthusiasts would meet, and has now expanded out to host events around the country and the world. As a direct result of TECH Cocktail events, companies have found employees, co-founders, funding, and startups have even been acquired. Initiatives including the Chicago Innovation Awards and the Illinois Technology Association’s CityLIGHTS Awards also instill a sense of community, and highlight the region’s entrepreneurial spirit.

Tech Cocktail and Citylights Awards

Another one of Chicago’s hyper-local exports is EveryBlock, which allows a user to search for information from their surrounding neighborhoods. The site began as the online police blotter, ChicagoCrime.org and over time has expanded to include local business ratings, blog articles, photos and more. EveryBlock is now launched in over 16 cities across the US. EveryBlock founder, Adrian Holovaty also developed the open-source Web framework, Django, which EveryBlock.com, and many other sites around the world, are built on. And, if that weren’t enough, there’s another popular, open-source web framework developed in Chicago -- Ruby on Rails was developed by BaseCamp parent company 37signals. Many high-profile sites, from Groupon to Twitter can directly credit their development to those innovative platforms.

Ruby on Rails, django and Everyblock

Paving the way for similar open data apps and innovation, Chicago's Mayor Rahm Emanuel has upended the status quo and injected a streamlined policy objective to realease as much publicly available data as possible in a digestable online format. And to urge the local developer community to assist the City of Chicago in its effort to draw new efficiencies from the data sets, Apps For Metro Chicago was launched in 2011. The Mayor has installed a C-suite of digital stewards in John Tolva (Chief Technology Officer) and Brett Goldstein (Chief Data Officer) to ensure our city is in good hands as it moves forward into the next decade with technology in the forefront of Chicago's economic aspirations.

 

Further Reading:

Explore Chicago's Info-Tech Ecosystem

The Chart below depicts a few of the important components that make up Chicago's info-tech ecosystem. Each component links to a list of players in that field. Please take a look around and feel free to let us know what we're missing.

Explore The Chicago Info-Tech Ecosystem

*Number of establishments based on 2008 data

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