A New 1871
History remembers 1871 for the Great Chicago Fire, but the lasting legacy was the reconstruction that followed when innovators, architects and entrepreneurs flocked to the city. The city was rebuilt to be bigger and better, having been quickly transformed into the focal point of business that it is today.
With a similar vision, the Chicagoland Entrepreneurial Center (CEC), with the support of venture capitalist J.B. Pritzker and a $2.3 million state grant from the 2009 Illinois Jobs Now! Capital plan, created 1871, a center where digital designers, engineers and entrepreneurs can come to develop their businesses.
1871 is the Chicagoland Entrepreneurial Center’s attempt to consolidate Chicago’s fragmented entrepreneurial ecosystem. From the space’s interior design to a wide range of programming hosted there, 1871’s mission is to help startups grow into successful companies, and keeping them in Chicago after they have done so.
1871 is located on the twelfth floor of the Merchandise Mart off of Michigan Avenue. The 50,000 square foot space is open with short and long desks that are arranged to mimic the streets of Chicago and a wavy, blue wall that represents the river.
There is a large open space where you can bounce your ideas off of individuals from other 1871 startups. At Intelligentsia, a coffee shop startup at 1871 based on the idea of fostering “an environment steeped in educating and humility,” you may find yourself having a cup of coffee with legendary startup founders such as Chuck Templeton who come to the center to share their experience and knowledge to new startups.
When I visited 1871 a few weeks ago, Neal Sales-Griffin, co-founder and CEO of Starter League (also located at 1871) and NU alum, noted that the one disadvantage to this open space was becoming distracted by the work that the brilliant individuals that surround you were doing. But the 1871 interior design team recognized that this might be a problem and thus also created conference rooms and individual office spaces for startups to rent so that they can have a space that allows them to fully concentrate on their work.
The Economic Impact of 1871
This past month, 1871 celebrated its one-year anniversary. The 1871 team asked Lab42 to analyze the economic impact of the startup center in its first twelve months. The results bring to mind the awe that spectators must have felt when observing the success of the Great Chicago Reconstruction over a century ago.
Chicago – an ideal startup ecosystem
In an interview with the Huffington Post, Kevin Willer, President and CEO of the CEC, highlighted three forms of capital that are required for a startup ecosystem to thrive:
human, financial, and social.
Chicago has all three.
Chicago is rich in human capital. Willer points out that “in terms of human capital we have two of the top five business schools, five renowned design schools, and access to several universities with leading computer sciences programs.”
Furthermore, financial capital is abundant in Chicago. “Capital follows great opportunity and we’ve been seeing this over the past two years. Local VC firms are keeping investments local and national VC firms are starting to come [to Chicago] looking for deals. We’re talking about rather sizeable investments ranging from 10M to 40M. Additionally, Chicago has an extremely supportive ‘Angel’ community, which provides ample support to our seed stage companies.”
Chicago has great social capital as well with the influence of Chicago-based Fortune 500 companies such as Walgreens, Allstate, United Arlines and JPMorgan Chase. The PwC Cities of Opportunity 2012 report ranked Chicago ranked first in intellectual capital and innovation, and secured second in economic clout, ease of doing business and technological readiness among U.S. cities.
So why has Chicago not become a startup hub in the past?
“It’s not a problem of talent,” says Willer, “It’s that we are tasked with keeping them [in Chicago],” instead of leaving for other cities like the Silicon Valley.
Thanks to the opportunity and resources that 1871 is creating, the issue of losing talent is rapidly diminishing. This year, 1871 received 900 startup applications for the 225 spots in its center.
Chicago may become a leading city of opportunity as a startup ecosystem, adding another top ranking to its already long list of accomplishments.
Photo Credit : NBR