At the end of every year, while many are reflecting on the year that was, Chicago Inno is taking a moment to look ahead at the companies poised to make headlines in the year to come.
Since we began reporting on Chicago’s tech and startup ecosystem in 2014, we've had our finger on the pulse of all the innovative ideas, significant funding rounds and big expansion plans coming out of the city’s startups.
On our annual Startups to Watch list, we highlight a handful of Chicago startups that are poised to make big moves in the next year, whether that's raising sizable funding rounds, acquiring other companies, accomplishing fast growth or simply continuing work on challenging problems. From downtown through the city’s neighborhoods and suburbs, there are plenty of early-stage Chicagoland startups on the rise.
To help us compile this year’s Startups to Watch list, we reached out to Chicago venture capitalists and tech leaders to help shape a list of 21 early-stage startups to keep an eye on in 2021. These companies have demonstrated impressive traction by fundraising venture capital, landing spots in coveted accelerator programs or winning prestigious pitch competitions. Some of the honorees on this list even stepped up to help address the ongoing Covid-19 pandemic.
The startups listed below operate in a diverse set of industries, are led by founders of all different backgrounds, and are making a significant impact with their products and services. From an upstart making indoor hydroponic systems, to an online memorial and funeral company, to a materials startup backed by Ralph Lauren and a startup creating an entirely new way for small merchants to accept payments, here are our 21 Chicago startups to watch in 2021. (And scroll to the bottom to see some standouts from our previous Startups to Watch lists).
86 Repairs
86 Repairs has created a subscription service that manages repairs for restaurant groups. Named after the term used in the food service industry to describe something that's no longer on the menu, 86 Repairs works with brands like Jimmy John's, Burger King, Sonic and Popeye's. 86 Repairs helps restaurants troubleshoot issues, schedule a repair, and track how much they're spending on equipment maintenance. The startup coordinates all aspects of the repair process, dispatching someone from its authorized service network or from the restaurant's preferred vendor list. The startup raised $1.5 million last year.
Anthill
Founded in 2020 by Muriel Clauson and Young-Jae Kim, Anthill is a workplace management startup that provides employees with a personal coach to help them grow within their organization and increase engagement. Its software helps companies better retain their employees and unlock their full potential, an especially challenging problem in a world of increased remote work. The startup was part of the 2020 Techstars New York class, which had a focus this year of Health, Wealth and Happiness.
Cashdrop
Founded in 2019 by Ruben Flores-Martinez, Chicago startup Cashdrop is a mobile app that's changing the game for small-business owners who want to set up an online shop and accept mobile orders. The startup allows merchants to create online storefronts in less than 15 minutes. It also facilitates contactless payment without handling cash or swiping credit cards and charges no fees to the business. Cashdrop has added hundreds of merchants across the country to its platform, including restaurants, food trucks, barber shops, food halls, fashion designers and event planners. Flores-Martinez told Chicago Inno that the startup's platform combines the simplicity and ubiquity of Venmo or Cash App but on the back end has the power of Square or Shopify to be a store's entire point-of-sale system. Cashdrop raised a $2.7 million seed round earlier this year.
Cohesion
To help power the smart buildings of the future, local startup Cohesion has built a SaaS platform for building managers that allows them to distribute mobile keycards to tenants, facilitate waiver signings, and give tenants an easy way to book building amenities and make maintenance requests. Cohesion’s technology was originally built by Chicago-based Environmental Systems Design (ESD) to manage operations at 151 N. Franklin St., a downtown building home to Facebook’s Chicago headquarters. But in August 2018, co-founder and CEO Thru Shivakumar launched Cohesion as an official ESD spin-off venture. Now, Cohesion has raised $6.5 million in venture capital funding and its clients include The John Buck Company, Transwestern, Frasers Property and Riverside Investment & Development.
CoPilot
Chicago startup CoPilot wants to help you get a better deal on your next car. The company, created in 2018, is a mobile app that uses machine learning and human experts to help buyers find the best price on a new or nearly new vehicle. The app helps users through all stages of the buying process, from finding the right vehicle to searching nearby dealerships for the lowest price, and gives shoppers all the information they need to make a purchase. CoPilot is led by serial Chicago entrepreneur Pat Ryan, who told Chicago Inno that the startup aims to be an "expert in your pocket" when buying a car. CoPilot raised a $10 million Series A round earlier this year from backers that include Next Coast Ventures and SciFi ventures, the VC firm from PayPal co-founder Max Levchin.
Dimension Inx
Dimension Inx is a spinout from Northwestern University that creates materials for organ and tissue implants. The startup, led by CEO Caralynn Nowinski Collens, who previously led Chicago innovation accelerator UI LABS, developed a biofabrication process that creates 3D-printed implants that can repair human tissue and organs. Used primarily in reconstructive surgery, the startup's technology is first creating therapeutic implants for facial reconstruction. It raised $3.2 million in a seed round earlier this year from backers that included Revolution's Rise of the Rest fund.
Frank
Chicago startup Frank is a digital tool for workers to organize and improve their workplace. The company, a public benefit corporation, is designed for non-management workers to have a stronger voice and have more resources for organizing. Frank is led by Logan LaHive, the former Techstars Chicago managing director and founder of Belly, a customer loyalty program for businesses. Frank's investors include Hyde Park Venture Partners.
Havoc Shield
Havoc Shield is a cybersecurity startup for startups. The company, founded in 2019, has built a fast and effective cybersecurity program specifically for startups, providing them with an action plan that guides them step-by-step through a prioritized security program. The idea is to help small companies that don’t have dedicated security teams ward off data breaches, phishing and dark web activity. The company was founded last year by Brian Fritton, the former vice president of engineering at Civis Analytics. Havoc Shield raised $1.45 million earlier this year and participated in the Techstars Chicago accelerator program.
High Definition Vehicle Insurance
As one of several upstarts in Chicago’s booming insuretech industry, HDVI is differentiating itself by offering a cheaper tech-based insurance service for trucking fleets while also helping its clients improve safety, compliance and operations. HDVI’s customers include small to medium-sized business fleets that usually operate fleets up to 125 vehicles. The startup was founded in 2018 by Reid Spitz, who previously worked at 8VC, and Chuck Wallace, who is also the co-founder of Esurance. In August, HDVI raised $16 million in a Series A funding round led by 8VC and Munich Re Ventures, with additional participation from Qualcomm Ventures and Autotech Ventures.
JusticeText
To improve how public defenders build their cases, recent University of Chicago alums Devshi Mehrotra and Leslie Jones-Dove launched JusticeText. The software platform uses speech-to-text machine learning algorithms to transcribe video footage, which allows public defenders to quickly and efficiently sift through footage that can be imperative in how they build a case and defend a client. To get the startup off the ground, the Institute of Politics, a UChicago program founded by political consultant David Axelrod, the former chief strategist for President Barack Obama, provided JusticeText a small grant last year while the founders were still students. This year, JusticeText operated pilot programs with public defender’s offices in Kentucky, Oakland, New Orleans, and Monroe County, near Rochester, New York, and is currently one of 10 companies in gener8tor’s gBeta Social Impact accelerator.
LifeWeb 360
The startup, founded in 2019 by Ali Briggs and Rachele Louis, is an online platform that allows users to create memory pages to honor someone who recently died. The idea is for people to share photos, videos and written messages that celebrate and honor their loved ones, and viewers are encouraged to comment on items. LifeWeb 360 has raised a small friends and family round to propel its growth. And this year, the startup has seen a 300% increase in usage, was one of six Black-founded Chicago startups that received a grant from Google, and was one of 10 women-led startups in 1871’s WISTEM accelerator.
Luna Bay Booch
Luna Bay Booch, which hit the market last year, sells low-sugar, flavored canned hard kombucha that is non-GMO and gluten-free. Luna Bay’s hard kombucha flavors include ginger lemon, palo santo blueberry, hibiscus lavender and bourbon apple. Each is naturally fermented to 6% ABV, and a four-pack sells for $16. Luna Bay produces its kombucha at Pilot Project Brewing’s incubator in Logan Square, as well as in Colorado. Luna Bay can be purchased locally at Lululemon, Foxtrot, Binny’s, Whole Foods and Woodman’s, as well as restaurants and bars like Summerhouse Santa Monica and Benchmark.
Natural Fiber Welding
Based in downstate Peoria, Natural Fiber Welding is a startup that turns recycled cotton into high-performance materials. Founded in 2015, NFW takes recycled cotton, which is typically unsuitable for use in new cotton apparel after it's been used, and creates a process that transforms the material into a product that can be worn again. NFW welds the short fibers from cotton waste into longer fibers to create high-performance cotton yarns. This allows designers to reuse the cotton to create upcycled material that outperforms synthetic fabrics while still retaining the feel of cotton. This year the company landed an undisclosed investment from Ralph Lauren. The fashion giant will use the startup's technology to expand its use of recycled post-consumer cotton and reduce its reliance on non-biodegradable synthetics like polyester and nylon.
NestEgg
To help mom and pop landlords more easily manage their properties and tenants, Chicago startup NestEgg launched in 2019 with its software to streamline rental management tasks. Co-founded by CEO Eachan Fletcher, who was formerly the chief technology officer at Expedia, NestEgg’s platform allows landlords to collect rent, manage maintenance requests, and streamline mortgage and loan payments. Its client base has grown by 300% in the past six months, and last month, the startup raised a $7 million Series A round led by Hyde Park Venture Partners, which will allow it hire 40 new employees in 2021.
Rentgrata
Rentgrata is a Chicago startup that helps apartment searchers find homes by connecting them with current tenants. The startup operates a referral reward platform for apartment communities. Rentgrata’s app allows users to find an apartment, chat with residents and earn referral rewards for free. Rentgrata provides renter data to property owners, which helps them better tend to renter needs and increase retention. The company's investors include M25, Syndicate Fund and ApartmentJet co-founder Eric Broughton.
Rheaply
Arguably one of Chicago’s most-talked-about startups of 2020, Rheaply is gaining attention for its service that recycles and sources unused items from colleges, health-care systems, government agencies and more. Founded in 2015 by CEO Garry Cooper, Rheaply allows its clients to sell, rent and donate items on their platform they no longer need, including items like medical supplies, furniture and office equipment. In 2020 alone, Rheaply raised $2.5 million in a seed round, inked a partnership with Northwestern University to help the college source coronavirus supplies, and teamed up with the City of Chicago to help source personal protective equipment for local nonprofits and businesses. Rheaply also landed a contract with the U.S. Defense Logistics Agency and most recently took the top prize of $1 million at Revolution’s Rise of the Rest Virtual Tour: Equity Edition.
Rise Gardens
Founded in 2017 by former Sportsvision CEO Hank Adams, Rise Gardens is making indoor hydroponic systems for consumers interested in growing fruits and veggies in their home. The startup’s IoT-connected hydroponic systems walk users through how to successfully grow its custom seed pods for foods like kale, lettuce, tomatoes, peppers, basil and rosemary. Earlier this year, Rise Gardens raised $2.6 million in a seed round and was later backed by the Amazon Alexa Fund. Becoming part of the Amazon family allows Rise Gardens to streamline seed orders using Amazon’s Dash replenishment service. Rise Gardens’ original hydroponic system starts at $549, but the company released a cheaper, countertop device for $279.
SpringFour
Chicago fintech startup SpringFour is a social impact company that improves payment performance and reduces delinquencies by helping banks assist their borrowers during tough financial times. SpringFour sells its service to banks, which facilitates connecting borrowers with on-the-ground, curated and vetted nonprofit and government resources that can help borrowers get back on their feet. In 2018, SpringFour participated in 1871’s BMO Harris fintech accelerator, which introduced the startup to the bank and allowed them to partner. Now, SpringFour also counts Enova, Key Bank and LendUp as clients.
Trala
Chicago startup Trala is an app that helps you learn to play the violin. It features video tutorials with notable violinists along with "signal processing" technology that listens while you play the violin and gives instant feedback on rhythm and pitch mistakes. Its app has been downloaded more than 250,000 times, the company said in August, and students are spending an average of five hours per week on the app. Trala raised $3.5 million in seed funding this year in a round led by Next Play Ventures, an early-stage VC fund launched this year by former LinkedIn CEO Jeff Weiner. Trala is also a Techstars Chicago alum.
Upsolve
Upsolve is a Chicago and New York-based app that helps people file for bankruptcy for free. The nonprofit created a tool to help low-income families file for bankruptcy without hiring a lawyer, solving a major pain point for for bankruptcy filers: It often costs more to hire an attorney than people have in their bank accounts. It can cost $1,500 for attorney and legal fees, while the average Upsolve user has $225 in their checking account, CEO Rohan Pavuluri said. The app was one of Time Magazine's best inventions of 2020, and has raised funding from former Google CEO Eric Schmidt and Y Combinator's non-profit arm.
Zing Health
Founded in 2019 by Eric Whitaker and Ken Alleyne, and launched out of the innovation lab at the American Medical Association, Zing Health aims to provide a health-insurance option to minority people 65 and over that are typically underserved by traditional insurance models. The plan is available to those eligible for Medicare, covers most Medicare services and provides members with coverage for services that aren’t covered by traditional Medicare, like vision, hearing and dental. In May, Zing landed a big investment commitment from New York-based Newlight Partners. The firm said it will invest up to $150 million in Zing Health. Zing Health is Whitaker’s third insurance company. The second company, Symphonix Health, was a Medicare prescription drug plan that sold to UnitedHealth Group in 2016. Whitaker, who was previously the director of the Illinois Department of Public Health, is also the founder of health-care investment firm TWG Partners.
