Chicago’s startup ecosystem: 5 reasons to be bullish going into 2023

It’s clear that startup innovation is not restricted to Silicon Valley.

A successful company can be established in any city, and I encourage more founders to consider Chicago as an ideal location for building their startup in 2023.

Chicago saw 186 early-stage venture funded startups establish their headquarters in the city in 2022. Many Chicagoans in tech are committed to seeing this number continue to grow in the coming years.

Before we dive in, let me introduce myself:

My name is Landon; I’m pretty much 25; and I’m bullish on Chicago.

Although I wasn’t born in Chicago (originally from the SF Bay Area), I’m dedicated like many others to supporting the growth and success of our tech ecosystem.

We don’t want to be “another Silicon Valley.” Instead, we want to be the best Chicago we can be. And we have a ton of momentum going into 2023.

My focus at Drive Capital is finding the best early-stage startups in the Midwest and helping them build successful companies in Chicago.

To achieve our goal, we’re investing early, providing extensive support as investors, and cultivating a community that inspires founders to continue building in Chicago.

I spent a lot of time interacting with the amazing founders and builders of Chicago, and as a result, I’m eager to share my insights about our city.

5 reasons to be bullish on Chicago going into 2023:

1. New Energy 📈

Many who are familiar with Chicago’s tech scene would say there’s been new energy here since about 2020.

This is a result of many twenty-somethings being handed the reins to experiment and find new ways to innovate our city.

A few notable Gen Z accomplishments in 2022:

• One of my friends Claude (25) and his team organized the largest tech week in Chicago’s history, featuring guests such as Governor Pritzker and Pusha T. The event was so successful that Claude is planning an even bigger tech week for 2023.
• Another friend Cami (24) and her team at Decasonic organized the Midwest’s largest web3 conference, called Web3 Investor Day, which attracted over 400 institutional investors, builders, and key thought leaders to Chicago’s Fulton Market neighborhood. Chicago is becoming a hub for emerging technologies such as Web3, Generative AI, and Quantum Computing.
• My friend Meagan Loyst (25) organized a VC and startup summit in September, which featured panels and a pitch competition for founders that resulted in over $1.5 million in soft-commitments. Because of the impact from the summit, October 7th was officially declared “Gen Z VC Day” in Chicago by Mayor Lightfoot.

In summary, there is no hierarchy or need to wait for an opportunity to make a difference in Chicago. Our community of young builders is a testament to this.

If you are interested in getting involved and contributing to the growth of the tech industry in Chicago, you can do so immediately.

2. Talent is getting stronger everyday 💪🏽

Over the past year, I’ve had the opportunity to visit nearly all of the major universities in Chicago and the Midwest. It’s been inspiring to see how many dedicated and hard-working students are eager to contribute to the growth of Chicago after they graduate.

Our universities had some amazing accomplishments this year.

Highlighting a few:

• Northwestern and University of Chicago made the top 5 list of best business schools in the world.
• The University of Illinois was voted one of the top colleges for entrepreneurs.

Chicago’s top-ranked universities are nurturing the next generation of change makers who will play a significant role in shaping the future of our city.

These students are driven and ambitious, with a strong desire to make their mark by joining startups or starting their own ventures. They are truly the driving force behind the city’s growth and development.

In addition, Chicago has a diverse population, which means that startups can tap into a wide range of perspectives and experiences when building their teams.

With a talented workforce, strong support for the startup ecosystem, and a diverse and dynamic economy, Chicago is an ideal location for startups looking to make an impact.

3. Genuine collaboration through community 🤝

Chicago’s startup ecosystem is known for its strong sense of collaboration and community. The Midwest Hospitality is real.

I always enjoy my conversations with various firms to identify innovative ways to collaborate and contribute to the development of our city. By working together, we can achieve greater success.

Chicago’s startup ecosystem is home to a number of resources that provide a collaborative environment for startups and entrepreneurs. These organizations often host events, workshops, and other activities that bring together different members of the community to work on projects, share ideas, and learn from each other.

A few that I enjoyed in 2022:

• The ChiTechIRL organization was established to provide monthly events for the startup community in Chicago. These events were well-attended, with around 150–200 people at each one. It was always a great opportunity to network with new people and find unique ways to collaborate with others in the industry. The events were held at various locations around the city, and my personal favorite was the yacht party.
• My friends at World Business Chicago led 60+ innovation and venture events across 4 flagship programs in 2022. I worked closely with their team to launch the Gen Z VC Summit mentioned earlier.
• My friend Samantha Schwartz and her team at Workbox, which is a co-working space in Chicago, clocked in 94+ hours of internal member events and programming. This includes 15 in-person networking and ecosystem events.
• I had the opportunity to collaborate with imnotArt on a few projects. imnotArt is the first NFT art gallery in Chicago, and together we hosted events to bring together the Web3 and AI Art communities in the city. These events were a great way to connect artists and enthusiasts with investors and founders in the field.

Overall, Chicago’s startup ecosystem is characterized by strong collaboration and a sense of community. This collaborative spirit helps to support the growth and success of startups and tech companies in the city, and it creates opportunities for companies to learn from and work with others in the ecosystem.

4. Growing city infrastructure 🧱

Chicago has experienced a lot of growth recently, and it doesn’t show any signs of slowing down.

In 2022, the city underwent some exciting transformations, and this trend will continue. This is important because a strong infrastructure is crucial for supporting the growth of our startup ecosystem as it becomes easier for them to scale and expand.

Some infrastructure insights from 2022:

• Our O’Hare airport was recently cleared for a massive expansion plan. In case you need to be reminded, O’Hare is one of our two major airports in Chicago. Transportation is essential in a growing startup ecosystem and having access to two major airports in one city gives us an advantage.
• Lincoln Yards is a highly anticipated development that is set to transform Chicago. It is the first neighborhood of its kind, encompassing 14 million square feet and designed to be a hub for tech and innovation. The city is excited about this project, and I had the opportunity to visit the area a few weeks ago. It is clear that Lincoln Yards has the potential to be a game-changer for the startup ecosystem in Chicago.
• According to my friend Tony Coglianese (the man to know at CBRE), there were more than 1.75 million square feet of tech real estate transactions in Chicago in 2022. Some of the most notable deals included Google’s purchase of the Thompson Center and new headquarters for companies such as Snapchat, Avant, and Fetch Rewards. Additionally, a number of “remote-first” companies changed course in the second half of the year and decided to open new offices in the city.

These infrastructure and development updates show the strength and growth of the tech industry in Chicago and suggest that it will continue to be a key player in the tech ecosystem.

5. Our city has momentum 📈

Despite all the progress and excitement that Chicago has experienced in recent years, there is still a lot of work to be done and opportunities to be seized. This is what drives me and many others in the city — the sense that there is always room for growth and improvement.

Chicago has a lot of potential and a lot to offer, and we are motivated to work towards realizing that potential. Whether it’s building up the tech ecosystem, supporting startups, or driving economic development, there is always more that can be done to help Chicago thrive and succeed.

Chicago founders need to continue to push the boundaries and think big. There is no limit to what can be achieved. By embracing a mindset of possibility and striving for greatness, Chicago founders can help drive the growth and success of the city’s startup ecosystem and contribute to its reputation as a hub for innovation and progress.

Keep up the momentum going into 2023 🚀 😎

If you’re interested in discussing ways to support and contribute to the growth of Chicago, my inbox is always open.

I’m happy to chat and brainstorm ideas on how we can stay optimistic and bullish on Chicago’s future.

Let’s get to work 🚙

— Landon@drivecapital.com

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