What’s the best city? This loaded and subjective question that has no doubt created hours of heated debate. During dinners, traffic jams, subway rides, and DMV lines people passionately espouse the virtues of their favorite restaurants, landmarks and sports teams.
Ten years ago, if you asked a tech entrepreneur this question you’d get a laugh. “Is there anything worth talking about East of Freemont (California)?” Today, however, with the proliferation of startup resources across the world, the answer is much different. Great startups come from all over. From the Cyber District (Boston) to the Silicon Alley (New York) and over to Webport (Portland), many cities offer a range of resources to boost entrepreneurial success. The question you have to ask is “Which one is right for me?”
As a second year MBA student looking to join a startup, my answer is Chicago. With its burgeoning startup community, high quality of life and great people, the Windy City offers a mix of opportunities that I can’t wait to join.
Startup Growth
The Chicago startup world is booming. Over the past 10 years investment in Chicago startups has grown at over 35% (CAGR)*. Last year alone, the number of new startups increased 51% and investors from around the world now look to Chicago as a place for outsized returns. There are a number of factors contributing to Chicago’s growing startup ecosystem.
1. Industry Groups & Associations
In the fall I spent a week in Chicago to learn about the city’s startup community, and was blown away by the range of startup events. Weeks before touching down at O’Hare, I used BuiltInChicago.org to pack my calendar with pitch-events, lectures and mixers. The Chicagoland Entrepreneurial Center (CEC) and Illinois Technology Association (ITA) welcomed me to events with dozens of rapidly growing tech companies. On a rainy Tuesday night I squeezed my way through the sold-out crowd at Technori Pitch, to join over 300 people engrossed in the startup community. At every turn I was warmly greeted by people who were happy to answer questions and offer encouragement about my potential move.
These organizations facilitate events and interactions that serve as the backbone of this ecosystem. They’re constantly adding new programming and events to feed further growth. (see comprehensive list of Chicago Startup resources)
2. Incubators
I also visited several of the city’s startup incubators. At Sandbox, Lightbank and Excelerate I met entrepreneurs who were growing their businesses, and building momentum with the support of peers and mentors. I was so impressed with these companies that I even worked with one in January, Buzz Referrals, a member of the Excelerate class of 2011.
Even more exciting is the recent announcement about 1871, Chicago’s new technology and entrepreneurship hub. While I heard rumors about this public-private partnership in October, it’s fantastic to know that it will open this spring with room for 400 people.
3. Public Support
Support at both the city and state level further bolsters the Chicago startup environment. In December the state of Illinois created the $78M Illinois Advantage Program to support startups and small businesses, and just this week Governor Quinn announced the program’s first investments. At the municipal level, Mayor Rahm Emanuel is committed to supporting entrepreneurship, stating that for startups the city “will not be a roadblock….[but] a partner making sure they have what they need to exceed their dreams”** Chicago understands the value and growth that startups bring and is knocking down the bureaucratic barriers to their success.
4. Quality of Life
Ask anyone what they think of Chicago (trust me I have) and a grin crawls across their face. “I love Chicago! It’s one of my favorite cities.” The response is unanimous and includes stories of the beautiful architecture, waterfront, museums, fantastic food and culture. The city offers all of the delights of any international metropolis with one special addition — it’s affordable.
According to salary.com the cost of living in Chicago is 29.1% lower than New York and 26.8% below San Francisco. In Chicago, it’s possible to live within the city limits, without cramming yourself and three roommates into a one-bedroom shoebox. The lower cost of living allows you to not only enjoy the city’s amenities, but also dream of buying a house and raising a family within the city proper – no small point as I finish grad school and look to the years ahead.
5. People — The Midwest Mindset
One thing that’s long-made Chicago a great place is the people. Walking down the street strangers greet you with a warm smile and “hello.” In some (unnamed) east coast cities this is cause to check your pocket and speed your pace, but in the Midwest it’s simply proper etiquette.
While this courtesy is great, the people of Chicago have an appeal that goes far beyond social norms. In several of my meetings people spoke of the “Midwest Mindset.” They described this as a special mentality that Chicagoans have towards work and business. According to Troy Henikoff, Chicagoans exhibit a degree of loyalty not seen elsewhere. Employees don’t perpetually bounce from company to company, as they do in the Silicon Valley or New York. Instead they like to join a business and truly dedicate themselves to its success. This creates stability that can make the difference between success and failure for an early stage company. University of Chicago Professor Linda Darragh explained how the Midwest Mindset focuses on sound business fundamentals. In Chicago, people build and invest in businesses with a clear value proposition and monetization strategy. In other parts of the country this is not always the case. After two years studying business and finance, it seems awfully sensible for me to join a business that delivers tangible benefits to paying customers.
There are lots of cities where you can find startup growth, high quality of life or great people. What differentiates Chicago is the way these factors intersect. Chicago has become a vibrant, hub for business and a wonderful place for people to thrive. I look forward to my move this spring so I can find my place in this ecosystem and add to the momentum that’s already built.
*Built In Chicago, “Chicago Digital Technology Funding History.” http://www.builtinchicago.org/page/funding-stories-exits-and-more
**Excelerate Labs Demo Day Highlight Video http://vimeo.com/32453245
