1.
The Startup Climate In
Chicago
It’s Hotter than Global Warming!
How You Can It Make it Great

2.
Rules For Success in
Chicago
• Chicago is Unique-We aren’t Silicon Valley and
don’t want to be Silicon Anything: Be Chicago!
• Innovate Around Strengths and Around
MacroTrends
• Celebrate and Publicize Success!!
• Don’t Dwell on or Ridicule Failure
• Collaborate “Give Before You Get”
• Take The Long View

3.
What Does Chicago Have?
Seed Funding, Some Venture Capital
Talented People
Fortune 500 Companies
Universities, Culture, History

4.
Roadblocks to
Success
• Culture That Takes Tolls (Hand Out Not Up)
• Want To Work With Friends-Friends Aren’t Here
• Understanding Risk, And When to Take It
• Fear of Failure; Risk is a 4 Letter Word
• Risk Averse Corporate Customers
• Money, Money, Money, Money
• Violence, Not the Weather

5.
Evidence of Success
• In 2013, Chicago startups raised over $1B in venture
capital, up 169% from 2012
• 78 companies raised $1M in early stage capital
(Means they will need second stage!!)
• 2 University of Chicago NVC companies exited for
over $3.4B in valuation (Braintree 2007, GrubHub
2006) Fieldglass aquired by SAP for $1B
• Some Acquisitions of Startups by Local Companies

6.
27 Total Investments: 2007(1), 2008(2), 2009
(1), 2010 (5), 2011(5), 2012(7), 2013(6)
In 2013 HPA did 6 new investments and 10
follow on rounds with 1 exit
Track Record: 3 failures, 5 exits and the 19
operating

7.
How Startups See The World

8.
How Outsiders See Startups

9.
Characteristics of Successful Startups

10.
When Successful Investors Invest?

11.
“Startups are transforming our
society. Over the past 100 years,
we’ve gone from an industrial era
to a post information era where
the network is rapidly disrupting
the hierarchy and transforming the
way we work and live.”
-Brad Feld, Foundry Group
Society is Rapidly Changing

12.
Networks not Hierarchies
Organizations operate from top down. Software and technology enables them to be
flatter, fleeter, and first.
Everything Will Be Unbundled
Organizations that are generalists will be disintermediated by focused competitors that
engage specialized business silos
Everyone is a Node on the Network
Mobile technology makes everyone a node on the network they operate in. This has
deep ramifications for companies and society
Software is Eating the World
Technological changes are changing the way we produce, interact and transact enabling
flatter, customized chains of distribution and peer to peer networks.
“What’s different today is that we are seeing on a daily basis
revolutionary new ideas, devices, and form factors, not evolutionary
enhancements.”-Arvind Sodhani Intel Capital in the WSJ (Jan 1. 2014)
The MegaTrends

13.
What Makes A Good
Investment?

14.
It’s All About Perspective

15.
When Startups Are Successful

16.
Would You Have Invested?
• Service that lets you profit from unused office space (2012 Desktimeapp.com)
• Company that creates memorable experiences for customers and employees
(2012, KapowEvents.com)
• Company that does performance reviews in 15 minutes (2014 JuvodHR.com)
• Company that recycles children’s clothes? (2012, MoxieJean.com)
• Social network for math and science nerds (founded 2012, Brilliant.org)
• Company that provides free stock market charts (2008, Ycharts.com)
• Company that finds you discounted parking (2007 ParkWhiz.com, 2011
SpotHero.com)
• Company that uses an algorithm to provide fair market value for used IT
equipment and allows you to trade it (2011, MarkitX.com)
• Company that manages public grants and employs big data analytics and
automates compliance (2013 StreamLinkSoftware.com)
• Social network for Fishing (2013 Fishidy.com)

17.
What Can You Do?
1. Become A Customer of A Startup-Even if it means
taking some risk
2. Make an Introduction to a Potential Customer
3. Mentor Entrepreneurs for FREE utilizing Ohours.org
4. Give Startups Feedback
5. Talk about the local Startup Community with your
friends, neighbors and work associates
6. Invest via a local early stage VC fund or angel group
7. Encourage local government to support startups by
becoming a customer and easing regulations