Chicago is more than just the place the Chicago Cubs and Bulls call home. It’s more than just the place where the movie “Ferris Bueller” was filmed, and they yelled “Swing batter, batter swing!” from the stands at Wrigley Field. Bubbling under the surface of Chicago lies an up-and-coming tech center. With more businesses branching out of areas like Silicon Valley, the Midwest is likely a place where startups can be founded at a more reasonable financial rate.
Given that many large cities in the United States have increasingly become places for tech startups, it’s natural to see Chicago as one of the next tech centers. And, while it may seem like just another sleepy midwest town, the city is home to some of the largest tech companies in the United States, including Groupon and TrunkClub.
In this week’s Tech Center Tracker, Marc Harris, managing partner and founder of Occly, a wearable safety device company, shared with PYMNTS his views on how the windy city is becoming a new tech spot for entrepreneurs.
Before we jump into the post, here are a few quick facts about Chicago and its tech scene:
- Chicago’s population is 2,720,546 (2015)
- GDP of Chicago is $640.66 billion (2015)
- Chicago’s median household income is $48,522 (2015)
- Chicago has 2200+ startups and tech companies
- Chicago’s FinTech and Payments sectors saw 32 startups in 2016
- Total funding for Chicago in the last year was $2,104,222,135
Here is an excerpt of the conversation:
PYMNTS: Can you describe your personal and professional experience with the tech community in Chicago?
MH: I’m a Chicago native, so it was important for me to give back to the city. As a company, Occly is closely involved with the Chicago tech community. Some of the organizations we’ve worked with include StartupGrind and Techweek. Given that we’re not working out of an accelerator or incubator, it’s important to attend industry and community events. This gives us an opportunity to meet, collaborate and learn from others within the community.
PYMNTS: What do you think makes Chicago (or Illinois as a whole) an attractive location for both entrepreneurs and investors? Is there anything people may find surprising about operating a business here?
MH: Chicago has always been known as “The City That Works,” so naturally it is a great location for a startup. Chicago offers world class resources and industries. As a growing company, it’s important to have access to a strong talent pool, and Chicago offers that.
PYMNTS: How does the startup and tech scene in Chicago differ from other cities in the United States?
MH: The startup scene differs from other cities in that it is more grassroots and personal. No one moves to Chicago to start their company from the ground up. Everything happening here started here by Chicagoans.
PYMNTS: What are some of the challenges facing startups in Chicago? Are there any initiatives to help address those barriers?
MH: National recognition is a challenge for Chicago startups, although that is improving. Some of the predominate investing groups are looking to close the gap and create an environment that will allow Chicago to be recognized as one of the best places for startups. A recent report published by Pitchbook also suggests that Chicago ranks at the top for highest return on venture capital investments.
PYMNTS: How has Chicago’s startup ecosystem changed in recent years? What do you think has sparked this transformation?
MH: What was once a scattered group of unassociated people has now transformed into a very active community. Chicagoans are willing to help each other and [are] always looking to get themselves involved. I think the transformation is a natural result of several Chicago startups really exploding on the national and international scene. It has proven that tech startups outside of California can do it too.
PYMNTS: Which sectors of the technology landscape are thriving in Chicago? How do you see these industries evolving in the coming years?
MH: Chicago, because of its diverse background and long history in manufacturing and development, is resulting in a wide range of innovation. Startups in agriculture, personal safety, aerospace and food production are the norm in Chicago. New tech has helped these industries streamline and improve their process to increase output at a lower cost.
PYMNTS: Is there anything else you think people should know about Chicago’s role as a global tech center?
MH: People should know that Chicago offers a level of skill and innovation equal to any other place globally. Because we are Midwesterners, as a culture, we are more willing and open to helping each other in the community. Chicago companies develop cutting edge ideas, and because of its intimate setting, it often leads to less noise when getting things done. The cost of doing business in Chicago is also relatively less than some of the other larger known tech communities, but offer equal amount of talent and resources.