The Great Chicago Fire of 1871, though horribly tragic, ushered in an era of architectural innovation and creation, responsible for the acclaimed skyline Chicago has today. In homage to that remarkable moment in history-when talented individuals seized a moment and rebuilt a city-the space called "1871," which opened last May in the Merchandise Mart, was created to provide local startups with an affordable workspace, access to mentors, educational programs and like-minded thinkers.
It was the ideal setting for the Jewish United Fund's Trades, Industries and Professions (TIP) event "Fueling the Future: An In-Depth Look at the Chicago Tech Start-Up Ecosystem," which was held Feb. 13.
More than 200 people attended the sold out event to hear four distinguished Chicago entrepreneurs and industry experts engage in a panel discussion about the Chicago tech ecosystem, where it is now and where it is headed in the future.
Steven Miller, principal and co-founder of Origins Ventures, moderated the discussion which featured two successful impresarios, Gregg Kaplan, the founder and former CEO of Redbox, and Talia Mashiach, the CEO and founder of Eved, an event commerce company that automates the buying and selling for meetings and events. Representing the Venture Capitalist side of the start-up equation was Bret Maxwell, the managing general partner for MK Capital.
The focus of the evening was growing the Chicago startup community. All of the panelists sit on the Chicagoland Entrepreneurial Center board, which is responsible for 1871 and supports entrepreneurs on their path to building high-growth, sustainable businesses that serve as platforms for economic development and civic leadership. With 220 start-ups building companies out of 1871, Chicago is competing with the tech heavy coasts.
One way to stay local is to find funding from Chicago-based venture capitalists like Maxwell.
"Being local helps you meet every month," Mashiach said. "The expectations versus outside of Chicago and inside Chicago are much more manageable….And I just really believe in this awesome city and this community here and I wanted to be Chicago based."
"My goal is to stay in Chicago [with my next business] from a money perspective," Kaplan said. "…What is the compelling reason to go out of Chicago? This is a small community, you know the people here and you are connected to them and the prestige, so to speak, about the firms on the east coast is not really an issue for me. I want somebody who I know."
Maxwell, who has spent 27 years in the venture capital world and founded MK Capital, shared several insights on what venture capitalists are looking to invest in.
"Think about the search business," Maxwell said. "Most people here remember Yahoo. At the time Yahoo first got funded, the Google guys were using it as their search engine. And they felt like they had a lot more to add like ad words, and everything else that they did. And yet, if you asked 99 percent of the investment community, the venture community, people would have said Yahoo has done everything and it's over. And clearly, it wasn't over. It wasn't even close to being over. In a lot of these IT sectors, people think we are in these mature states…sometimes it's the subtle little things…that may be technology enabled but that may not be pure technology and that can cause the dynamic growth."
Jewish values played a large role in shaping all of their identities as entrepreneurs and business owners. "Being an entrepreneur is challenging the status quo," Kaplan told the audience. "Red Box is a real example of that. We came from an industry that has a whole lot of can't dos- where you could not charge a $1 for a DVD. Blockbuster has 6,000 stores and you weren't allowed to return a DVD to any other stores and we said that doesn't make any sense. Successful entrepreneurs are constantly challenging status quo and I think that's part of Jewish culture where you are taught to raise questions."
"The other part that people find very interesting is that I keep Shabbat," Mashiach continued. "A lot of people say [to me], "you have a startup, you have five kids, how do you do that?" And I tell you, I think it's my little secret sauce. I would probably work seven days a week all the time. I wouldn't have balance to be with my kids and I wouldn't recharge. So from Friday night till Saturday night, I shut off my phone and my complete focus is on my family and things that are totally not work related. It's my revival and it gives me the opportunity to come back in on Monday-or Saturday night usually-and start all over again."
During the panel discussion, participants "facebooked" their questions to the Jewish United Fund fan page and "tweeted" @JUFChicago.
Participation at the event required a gift to the 2013 JUF Annual Campaign. For more information about the Trades, Industries and Professions Division, visit www.juf.org/professionals. For more information about JUF's Chicago Entrepreneurs Forum, visit www.juf.org/professionals/cjef.aspx.