Booming: Chicago Startups Are on the Rise Nationally
Ah, the Windy City. It’s been a great home for industry for over a century, but now the city by the lake’s many successful startups are getting noticed. VC money is flowing in at an increasing rate, acquisitions are in the billions, and the Chicago digital marketing scene is nipping at the heels of New York and L.A.
According to a new report, total startup funding rose 9% between 2014 and 2015, more than 100 companies received funding, and dozens managed successful exits that are together worth billions.
If you’re wondering why businesses are making Chicago their home, we’ve got three reasons to share — plus we look at the important role of digital marketing.
Impressive Startup Growth
The Chicago startup scene has just been growing and growing since 2009. Funding has grown to more than $1.7 billion in 2015. That’s a massive fourfold increase since 2012, when funding was only $391 million.
Dollars from exit events was also up in 2015 by more than 15% to a total of around $8.2 billion. That money, which doesn’t include any IPO lending, went to 39 companies. A few high-dollar acquisitions stand out, like HERE, which makes personalized maps and sold for $3 billion, and Merge Healthcare, which sold to IBM for $1 billion.
Said J.B. Pritzker, founder of VC firm Pritzker Group:
Each year since 2009, Chicago seems to have another ‘best year ever.’ The Chicago tech scene matured in 2015 with very impressive capital raises and exits, and I expect that will continue in 2016 and beyond.
Substantial VC Funding
Speaking of VC funding, over 143 companies raised $1.72 million in venture funding last year. Eighteen of those firms broke the $20-million mark and an astounding 94 were over the $1 million mark.
By industry share, the big winner was marketing, advertising, and social media firms — 20 of which took in around $108 million in funding. However, by dollar amount, the big winner was the fintech niche, where 12 startups secured $805 million in VC funding.
And the World Takes Notice
With so much money at stake, it should come as little surprise that the world is sitting up and taking notice of Chicagoland. One report notes the city’s “growing stable of unicorns.”
Before 2015, only one firm, big data pioneer Mu Sigma Inc., was valued at the $1-billion mark. But now three other companies have joined Mu Sigma with billion-dollar valuations — Avant, Uptake, and ExteNet Systems.
“There’s now a national recognition that Chicago has very fertile ground for technology entrepreneurs, investors, and engineers,” noted J.B. Pritzker.
Besides tech, plenty of other startup ventures are realizing that Chicago is a great place to start and grow a business. E-commerce firms, distribution businesses, and even commercial real estate firms, are all flocking to the Windy City because of its strategic geographic location in the middle of the country, its existing transportation infrastructure, and its large supply of skilled workers.
Get Your Chicago Business Noticed
To be sure, there’s a booming opportunity for your business in Chicago. Yet as more people become aware of that fact, expect the competition to get pretty stiff — each step of the way.
So to review, if your business is going to get acquired for $1 billion, you’re going to need VC funding. If you’re going to get that crucial VC funding, you’ll need to be one of the businesses that demonstrate a true potential for growth.
And if you’re going to position yourself for growth, you’re going to need great digital marketing.
Today’s digital marketing is all about strategies that will generate sales leads and transactions. We can help with your digital marketing from our brand new Chicago location. It might be just what your business needs to move a step closer to that billion-dollar acquisition.