State Snapshot: The Illinois Department of Innovation & Technology

Tell us a bit about tech in Illinois. What is Illinois’ culture like, and how does it shape the tech ecosystem?
The state of Illinois is a millennial Midwestern culture, a combination of fiscal conservativeness with an entrepreneurial spirit. In the last 5 years, a number of tech incubators, venture capitalists, and successful entrepreneurial exits have fostered the tech ecosystem to higher heights than before. The Illinois government has rolled out incentives like the angel tax credit to encourage seed investment in new companies. High value exits like Fieldglass and Cleversafe, and successful ventures like GroupOn, GrubHub, and BrainTree, have increased entrepreneurial confidence. The university ecosystem, made up of University of Illinois system, University of Chicago, Northwestern, Illinois Institute of Technology, and DePaul, are consistently building an extremely attractive talent pipeline.

What’s special about the tech scene in Illinois, that isn’t offered by other tech communities? What is a strength of Illinois’ ecosystem that often goes unrecognized?
If you want all 4 R’s — rivers, roads, railways, or runways — Illinois’ location is unbeatable. In addition, Illinois boasts one of the biggest North American Internet Exchange points in Chicago, Illinois’ commercial capital. A vibrant tech incubation scene includes 1871 (digital tech), Chicago Innovation Exchange (University of Chicago), EnterpriseWorks (U of I), Catalyze, Catapult, Matter, Pivotal Labs, and more are helping entrepreneurs raise hundreds of millions while creating thousands of jobs.

Illinois has tremendous economic diversity. This includes:

  • Biomedical leaders (e.g. Baxter and Abbott)
  • Telecommunication brands (e.g. Motorola and Tellabs)
  • Financial exchanges (e.g. the Chicago Board of Trade and Chicago Mercantile Exchange)
  • Data aggregators (e.g. TransUnion)
  • Transportation brand (e.g. United Airlines)
  • Food industry leaders (e.g. McDonalds and Kraft-Heinz)

This diversity of large corporate buyers that are linked to the entrepreneurial community through various partnerships and programs is often overlooked as a key player in the Illinois’ tech ecosystem.

What would you like to see more of in the tech ecosystem in Illinois? Which initiatives, advancements, etc.?
Illinois has been able to build a good angel and venture capital community. However, there is less strength in investors in Round B and beyond. The Illinois Treasurer has a $220M technology and innovation fund that funds other funds. There are major equity investors like Madison Dearborn Partners and others. However, Illinois entrepreneurs rely heavily on West coast funders to lead large later stage rounds.

Another issue is losing graduates from the great university systems Illinois has to the coasts where the tech ecosystem is more mature.

Both these issues have been on the radar of Governor Rauner, who himself was a venture capitalist before winning the gubernatorial election.

How would you describe your role in Illinois’ tech ecosystem? Where do you fit in?
State of Illinois is ultimately responsible for creating an environment where business and the tech ecosystem thrives. This is done through creating policy and regulations that enable a positive business environment, a robust talent pool, an investment community that is ready to invest in Illinois’ entrepreneurs, and a government that makes it easier to do business with and in the state.

I play multiple roles. As the Secretary of Department of Innovation & Technology, my primary responsibility is to digitally transform the state government to make it easier to do business with and in the state. We are transforming Illinois to be the first “Smarter State” in the nation. This transformation focuses on State as the Customer (internal digital transformation that includes better customer service and employee productivity), State as an enabler (fostering businesses, entrepreneurship and talent development), and State as a demand aggregator (enabling suburban and rural government entities to become smarter through strategic use of technology). We were fortunate to be a case study for the research firm IDC, highlighting our work and results.

As an angel investor and advisory board member of Illinois Treasurer’s Technology and Innovation Fund, I also ensure investment in growth stage companies continue so they can create jobs in Illinois.

I created an Entrepreneur Showcase to expose agency CIOs to emerging technology, approaches, and talent.

As a board member of a charter school network, I ensure technology talent pool continues to grow.

Which other organizations in the state do you collaborate with?
I work closely with the City of Chicago, which is the commercial capital of Illinois.

  • An advisor to Chicago Mayor Rahm Emanuel on their council ChicagoNEXT that focuses on economic growth
  • A board member of Internet of Things Midwest council at Illinois Technology Association
  • A judge and advisory board member of the Chicago Innovation Awards
  • A member at the Economic Club of Chicago
  • A board member of Uno Charter School Network (with 16 elementary and high schools)

I also collaborate closely with Illinois-based corporations, incubators and educators. I co-chair State advisory boards with CEOs, CIOs, CISO, CDOs, and other executives that are helping the State government reshape Illinois Government and its economy.

I also meet with delegations from around the world to share our Smart State work and learn from their accomplishments and best practices. In the last quarter, this has included India, Spain, and Israel.

What do you think Illinois will look like in 5 years?
With a completely transformed state government and becoming the first “Smarter State” of the nation, Illinois will retain and attract talent, businesses, jobs, and capital to regain its place in the heart of the United States of America. Entrepreneurship will continue to grow while corporations will easily find the solutions and talent needed to maintain their global competitiveness. Transformed government services will enable Illinois taxpayers — residents and businesses — to get services how, where, and when they want them most. A focus on self-sufficiency and education will reduce dependence on the government for their health and well-being. Our education system will create a much needed talent pipeline for growth sectors like technology, healthcare, advanced manufacturing, and clean energy. I see Illinois increasing its global competitiveness while maintaining its Midwestern compassion.

This article was contributed by Hardik Bhatt, CIO for the State of Illinois.

Learn more about the Illinois Department of Innovation & Technology here.

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