There's more to Chicago's big year in tech than just the millions in Series As, Bs, and Cs raised by its emerging startups and thriving early-stage companies. To truly define the city's big 2014, you need to hit on all of the As, Bs, and Cs that make up Chicago's booming innovation economy. Let's spell it out...
A: AVANTCREDIT: The top-funded Chicago company in 2014, AvantCredit - the two-year-old online provider of consumer loans - raised a $75 million Series C in August and secured a $200 million credit facility. Last week, we talked to AvantCredit's CFO about FinTech, the local innovation scene, and how the company is working to find and train top talent. Check out the video here.
B: BLUE1647: Chicago's innovation economy stretches beyond River North and this Pilsen-based shared space and accelerator embodies the city's expanding tech community. In August, the organization also announced that they would be opening up a new BLUE1647 in Englewood.
C: CDW: Yes, the Vernon Hills-based tech company went public in June 2013, but its stock has doubled since its $17-a-share IPO, settling at just under $35 on Dec. 1. When it comes to post-IPO performance, the national media views Chicago's standing as a tech hub entirely through the "Groupon prism," with the daily deals site's struggles dominating the narrative. CDW's continued success - as well as Textura's big 2014 (whose stock has increased to $25 a share since its June 13 IPO of $15) - is a critical part of that story being re-written. (As an aside, "C" was our strongest letter, with Chicago Ventures, Chicago Venture Summit, Catapult, Coyote Logistics, ContextMedia, and more as contenders).
D: DIGITAL MANUFACTURING: In February, President Obama awarded Chicago the Digital Manufacturing and Design Innovation Institute (DMDII), a first-of-its-kind public/private manufacturing hub that cements the city as one of the global leaders in the digital manufacturing revolution for years to come. The facility is under construction on Goose Island and it's set to open in early 2015. On top of that, Inventables - the Chicago-based one-stop-shop for makers - debuted the first ever 3D Carving Machine on Kickstarter in October, passing its $50,000 goal in 90 minutes and finishing at $650,000.
E: 1871: From its 25,000 square foot expansion to its niche incubators and global partnerships, Chicago's digital tech hub has been making moves all year. Check out our 1871 Topics Page for everything that they've been up to in 2014.
F: FOOD TECH: With GrubHub's successful IPO, thriving startups like Food Genius, Fooda, Artizone, 640 Labs, and Meal Sharing, and a new niche incubator (The Good Food Business Accelerator), the food space has been one of the strongest sectors in the city's innovation economy in 2014. And that's not to mention all of the Food Delivery startups to launch/expand here, including DoorDash, Caviar, HomeChef, FoxTrot, Postmates, and more.
G: GROUPON: Groupon's stock dropped 43 percent in 2014. However, the pillar startup's entire year was about looking ahead, undergoing a massive identity shift in order to expand beyond daily deals. With the the launch of Gnome, Snap, Deal Builder, Pages, and Getaways, the company continues to expand its offerings for businesses and consumers, setting its site/sights on a big 2015.
H: HEALTHCARE: Much like FoodTech, the healthcare space has emerged as one of the city's hottest sectors. ContextMedia, a patient engagement media startup, was signaled out as one of the city's "pre-IPO" startups at the Chicago Venture Summit and the city announced MATTER, an $8 million public/private hub for healthcare innovation.
I: IPOs: Three Chicago tech companies went public in 2014 - GrubHub, Paylocity, and ENOVA.
J: JELLYVISION: You don't have to be a new company to be innovative. Founded in 1989, the former game-maker and current interactive marketing agency, is one of the fastest growing digital companies in the city, moving up 16 spots on Built In Chicago's 'Top 100.'
K: KRISTI ROSS: The CEO of Dough (investing platform) and the president of Tastytrade (financial network), Ross - along with the below Os - represents Chicago's continued disruption of the financial sector, which it has been doing since the late 1800s.
L: LYTESHOT: As the inventor of Pinball and the center of nearly all coin-op game manufacturing, Chicago was once the game hub of the United States. LyteShot, the new local startup, looks to write a new chapter in the city's gaming history by creating a brand new market sector in Live Action Gaming.
M: THE MAYOR: Set aside all personal opinions before reading this next sentence. Chicago has an incredibly tech-friendly mayor who has been great for the city's innovation economy. (See 1871, DMDI, MATTER, World Business Chicago, etc.).
N: NARRATIVE SCIENCE: We had these guys penciled in for "N" even before last week's $10 million raise. Narrative Science, the company that uses artificial intelligence to turn data into computer-generated stories, is the ideal representation of how more tech startups that are hatched out of Midwest feeders are staying in Chicago. (The startup launched in 2010 out of Northwestern).
O: OPTIONSCITY and OPTIONSHOP: In order to sustain the health of a tech ecosystem, large, local corporations need to source tech from the startups and small businesses around them. (We call this Tech Local). This Fall, Chicago's FinTech community experienced this phenomenon when OptionsCity (a software provider for professional traders) acquired Optionshop (a provider of futures trading technology).
P: PRE-IPOs: Chicago has seen seven tech companies IPO in the past three years and that number looks to increase with nearly a dozen potential 'Public' candidates waiting in the wings. (In September, Crain's profiled over 30 startups primed for an IPO). The three I have my eye on for 2015 are AvantCredit, CleverSafe, and Coyote Logistics.
Q: QUARTERS: In terms of venture capital spending in Chicago, 2014's Q1, Q2, and Q3 were all individually higher than their 2012 and 2013 counterparts, with the lone exception being 2013 Q3 > 2014 Q4.
R: RAISE: With double digit growth month-over-month and 50+ new employees in 2014, Raise is one of Chicago's fastest growing startups. (And they do so quietly). The platform for buying and selling unused gift cards launched a mobile app in November and it will move into its new 46,000-square-foot Loop headquarters in March 2015.
S: SHARK OUT OF WATER: Ezra Galston, a Senior Associate with Chicago Ventures, has re-capped every Shark Tank Season 6 episode for us, separating fact from fiction and shining a light on how VCs really approach fundraising.
T: TRUNKCLUB: In one of the city's biggest, most high-profile deals of 2014, the men's clothing delivery service was acquired by Nordstrom for $350 million in July. (We also considered ‘Techweek’s Black Tie Rave’ for ’T.’ The controversial email helped ignite a citywide conversation about women in tech and what Chicago needs to do to in order reverse the ‘bro-gramming’ culture that has seeped into the community).
U: UBER: Whether you like it or not, Uber had a huge year in Chicago. This summer, a controversial ride-sharing bill was vetoed, all-but guaranteeing that the company's rumored Midwest HQ (and 420 jobs) was indeed coming to the city; it was officially announced in September.
V: VENTURE CAPITAL: In 2014, Chicago is on pace for its highest year in venture capital fundraising since 2011. And most encouragingly, a lot of these dollars are coming from in-house; ShiftGig's recent $10 million round came entirely from a variety of Windy City firms.
W: WEST LOOP: Though River North (and the Merch Mart) remains the city's tech center, the West Loop neighborhood is materializing as a rival for attracting innovators. Google, Twitter, and Uber are slated to open new Chicago offices there in 2015.
X: MOTO X: Yea, that's kind of cheating, but we need to talk about Motorola. At the end of October, Chinese tech company Lenovo officially acquired Motorola Mobility for $2.9 billion from Google, a deal that was originally announced back in January. Headquartered in the Merchandise Mart, Motorola - the creator of the cell phone - will stay in Chicago. The company also launched the Moto 360 this Fall, currently the best looking wearable on the market. (The Moto X is one of Motorola's best-selling phones).
Y: YAGAN, SAM: The Co-Founder of TechStars Chicago - amongst a million other things, like Match.com - Yagan is perhaps the most famous and prolific entrepreneur operating out of the city; he works in 1871. This year, Yagan also started a new Chicago-based venture firm, Corazon Capital.
Z: ZEBRA TECHNOLOGIES: With the help of Lincolnshire-based Zebra Technologies, the NFL has started inserting tracking devices into players' pads to collect advanced statistics, allowing teams to evolve training and scouting through the increased knowledge of player performance.
If you have thoughts on what we should have included in any of the above letters, please post them in the comments section.
