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Eh, three things really grind me gears about the tech scene in Chicago. 1) Lots of mediocre entrepreneurs that seem to have the same story: - Little to no h

Eh, three things really grind me gears about the tech scene in Chicago. 1) Lots of mediocre entrepreneurs that seem to have the same story: - Little to no hard skills. - Probably got an MBA from a good B-school - Did a stint at a consulting firm and is going to outsmart the competition with all the wisdom they gained at Accenture, McKinsey, BCG, Bain, or some big IL firm. - Does NOT have a technical co-founder but is being advised by some guy with a similar pedigree that attended a coding bootcamp/wrote a crappy iOS app/got a CS degree... but has written <10,000 lines of code in their life. - This person will interview you by giving you a fizz buzz test followed by "lateral thinking" brain-teaser questions). Very 90s. I know these people exist everywhere today but there's an unusually large number concentrated in Chicago. Must be something in the water? 2) Developer compensation is roughly 10% lower (when adjusted for CoL) than it should be. And in terms of equity compensation Chicago isn't even in the same league as SV today. Getting >0.25% as the initial engineering hire is extremely rare here - even at companies that lack a technical co-founder. This causes younger talent to get sucked to the coasts. 3) Many of the startups do not actively cultivate a technology or engineering culture. I think this largely stems from Point #1 - you really do need a tech co-founder to drive that side of the company.

desireco42 12y ago
+1 on everything what you just said. Totally true.
dannykingme 12y ago
I used to recite a similar list when someone would ask why I left. It's actually eerie how similar they are.
joezydeco 12y ago
Must be something in the water? It's a flood of NWU/Kellogg and UC/Booth MBA grads that continually stream into the market and slosh around the consulting firms before filling up the lobby at 1871 trying to catch the eye of a Pritzker. I left a Chicago-area startup that ticked off about 90% of your boxes above. It was a nightmare. The company is still going and the CEO is still busy running around talking about being a startup CEO instead of shipping the damned product.
deet 12y ago
I'll offer a hypothesis to explain #1: It's because Chicago's culture is excessively risk averse. There seems to be a tendency to seek permission or acceptance from peers and others before taking a risk (either in business, fashion, life, whatever). This is actually great for bootstrapping, because it keeps you in touch with the real world and immediate customer demand. But it leads to fewer qualified, technical people there with no history of 'business' thinking that striking off on their own and starting a company is a good idea. The people who do start companies there are often the ones who have gone through some kind of training program (MBA, work experience, etc.) that in their minds has qualified them to start a company. So I propose that it's not that the MBA types are overrepresented, it's that technical folks and others are underrepresented, because they're tending to not start companies. Disclaimer: totally conjecture, based on living in Chicago for eight years, but being from California and now living in NYC. In moving from Chicago to NYC the most striking difference (for me), other than the diversity, was the spirit that no one cares about you or what you do, so you might as well do whatever you want or think you can. For some that means starting companies.
- monksy 12y ago
  >It's because Chicago's culture is excessively risk averse. There seems to be a tendency to seek permission or acceptance from peers and others before taking a risk (either in business, fashion, life, whatever). Absolutely. Many of the early startups were based on needs that could serve people and corporate partners. We don't have a lot of app based businesses.
  - mrchicity 12y ago
    Are you implying that's a bad thing? Maybe if you want to go public with some insane P/E ratio selling the dream, but B2B tech businesses serve the economy, provide useful jobs, and have staying power.
    - monksy 12y ago
      I'm suggesting thats a great thing. Trying to startup a business with extremely small margins and for all of the public is an effort based on madness.
pcarolan 12y ago
Point 1 is true here, and out west too. I think MBA's are just better at raising money. Also, entrepreneurship is now getting built into every MBA program out there, so get ready for more of that. The equity thing needs to be addressed badly, my theory is that it's the result of our manufacturing past. We still have those manager/worker cultural remnants. I talked to one woman who said she "couldn't wait to turn 30 so people would take her seriously." We probably have some of the best engineers in the world here, but most of them aren't in startups, they're building corporate IT or middleware. You're not seeing a ton of new spinoffs from Groupon because the equity was so concentrated pre-ipo. Until we get a virtuous feedback loop of young guns spinning out of companies WITH some cash, it's probably not going to change. The VC community here is risk averse and typically only buys revenue. I disagree with point #3. Rails, Django, 8th light, Groupon, etc... have done more for craftsman culture than anywhere else I can think of. The midwest work ethic and quality standards have a lot to do with that.
deleted 12y ago
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toomuchtodo 12y ago
Excellent points. Its why I joined a SF startup remotely instead of working for a local Chicago startup.
kasey_junk 12y ago
Hah. I worked for that startup before I moved to Chicago. I suspect that doing SV style startups is something that is hard to do outside of SV and as it gets "taught" in B-schools around the world more and more people will try to emulate it poorly. Maybe I run in the wrong circles, but developer compensation is actually slightly elevated due to the trading houses. This is cyclic to some degree but when trading houses are flush they tend to be able to just come over the top of other businesses (and they have a culture of doing so). I think that also depresses the value of "equity" compensation. Lots and lots of developers in Chicago actually know how options work (how to price them etc) and are weaned on a diet of cash bonuses. It makes equity packages unattractive to that class of developer. Maybe that has a trickle down effect that causes equity to not be a major compensation component?
larsberg 12y ago
> I know these people exist everywhere today but there's an unusually large number concentrated in Chicago. Must be something in the water? Finance is also an extremely tempting lure. The pay is quite good (e.g., significantly better than Google), the hours are better, and the firms are generally supportive of external work. Many of the finance firms my friends work at (I've lived in the Chicago area most of my life) allow/encourage/hire people to serve on the C++ standardization committee, were co-founders of major open source projects such as R, etc. It's hard to lure people away from jobs like that where you're paid a lot and have a ton of freedom for a potential exit that's smaller than what you currently make, unless your startup becomes Google.
- mrchicity 12y ago
  To add to that, finance in Chicago is very different than finance at big banks. Many of the big players are tech companies first and foremost. Engineers are often on the "money side" of the business and respected/rewarded as such. Anyone trying to attract talented STEM employees in Chicago should read these to see what they're up against: http://www.nancyhua.com/2012/12/11/the-and-my-future/ http://www.nancyhua.com/2012/12/11/the-and-my-future/ http://qr.ae/3MPL1 http://qr.ae/3MPL1
deleted 12y ago
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mrchicity 12y ago
I think this will change as prop trading firms wane & consolidate. They attract the top STEM talent in Chicago and can pay them extremely well through profit sharing. There are a lot of engineers and "Xs who program" (where X ~= trader/researcher) taking home high-six and low-seven figure bonuses at the best groups. The people are usually very entrepreneurial and the firms have a "tech culture" where good code isn't a cost center. Why would guys getting market base, upside that pays yearly or quarterly, and autonomy trade that for $90k and a lottery ticket to build some glad-hander's dream? Markets are slow and competition is fierce, so I think you will see a lot guys from these Getco-ish firms leaving because the opportunity just isn't there anymore or the firm culture has changed. Most of these people keep a low profile and have cash socked away. Some will end up bootstrapping their own businesses here in Chicago, building them in the image of the firms where they cut their teeth: nimble, revenue-focused, scientific, and sharing success with employees.

desireco42 12y ago

+1 on everything what you just said. Totally true.

dannykingme 12y ago

I used to recite a similar list when someone would ask why I left. It's actually eerie how similar they are.

joezydeco 12y ago

Must be something in the water? It's a flood of NWU/Kellogg and UC/Booth MBA grads that continually stream into the market and slosh around the consulting firms before filling up the lobby at 1871 trying to catch the eye of a Pritzker. I left a Chicago-area startup that ticked off about 90% of your boxes above. It was a nightmare. The company is still going and the CEO is still busy running around talking about being a startup CEO instead of shipping the damned product.

deet 12y ago

I'll offer a hypothesis to explain #1: It's because Chicago's culture is excessively risk averse. There seems to be a tendency to seek permission or acceptance from peers and others before taking a risk (either in business, fashion, life, whatever). This is actually great for bootstrapping, because it keeps you in touch with the real world and immediate customer demand. But it leads to fewer qualified, technical people there with no history of 'business' thinking that striking off on their own and starting a company is a good idea. The people who do start companies there are often the ones who have gone through some kind of training program (MBA, work experience, etc.) that in their minds has qualified them to start a company. So I propose that it's not that the MBA types are overrepresented, it's that technical folks and others are underrepresented, because they're tending to not start companies. Disclaimer: totally conjecture, based on living in Chicago for eight years, but being from California and now living in NYC. In moving from Chicago to NYC the most striking difference (for me), other than the diversity, was the spirit that no one cares about you or what you do, so you might as well do whatever you want or think you can. For some that means starting companies.

monksy 12y ago
>It's because Chicago's culture is excessively risk averse. There seems to be a tendency to seek permission or acceptance from peers and others before taking a risk (either in business, fashion, life, whatever). Absolutely. Many of the early startups were based on needs that could serve people and corporate partners. We don't have a lot of app based businesses.
- mrchicity 12y ago
  Are you implying that's a bad thing? Maybe if you want to go public with some insane P/E ratio selling the dream, but B2B tech businesses serve the economy, provide useful jobs, and have staying power.
  - monksy 12y ago
    I'm suggesting thats a great thing. Trying to startup a business with extremely small margins and for all of the public is an effort based on madness.

pcarolan 12y ago

Point 1 is true here, and out west too. I think MBA's are just better at raising money. Also, entrepreneurship is now getting built into every MBA program out there, so get ready for more of that. The equity thing needs to be addressed badly, my theory is that it's the result of our manufacturing past. We still have those manager/worker cultural remnants. I talked to one woman who said she "couldn't wait to turn 30 so people would take her seriously." We probably have some of the best engineers in the world here, but most of them aren't in startups, they're building corporate IT or middleware. You're not seeing a ton of new spinoffs from Groupon because the equity was so concentrated pre-ipo. Until we get a virtuous feedback loop of young guns spinning out of companies WITH some cash, it's probably not going to change. The VC community here is risk averse and typically only buys revenue. I disagree with point #3. Rails, Django, 8th light, Groupon, etc... have done more for craftsman culture than anywhere else I can think of. The midwest work ethic and quality standards have a lot to do with that.

deleted 12y ago

[deleted]

toomuchtodo 12y ago

Excellent points. Its why I joined a SF startup remotely instead of working for a local Chicago startup.

kasey_junk 12y ago

Hah. I worked for that startup before I moved to Chicago. I suspect that doing SV style startups is something that is hard to do outside of SV and as it gets "taught" in B-schools around the world more and more people will try to emulate it poorly. Maybe I run in the wrong circles, but developer compensation is actually slightly elevated due to the trading houses. This is cyclic to some degree but when trading houses are flush they tend to be able to just come over the top of other businesses (and they have a culture of doing so). I think that also depresses the value of "equity" compensation. Lots and lots of developers in Chicago actually know how options work (how to price them etc) and are weaned on a diet of cash bonuses. It makes equity packages unattractive to that class of developer. Maybe that has a trickle down effect that causes equity to not be a major compensation component?

larsberg 12y ago

> I know these people exist everywhere today but there's an unusually large number concentrated in Chicago. Must be something in the water? Finance is also an extremely tempting lure. The pay is quite good (e.g., significantly better than Google), the hours are better, and the firms are generally supportive of external work. Many of the finance firms my friends work at (I've lived in the Chicago area most of my life) allow/encourage/hire people to serve on the C++ standardization committee, were co-founders of major open source projects such as R, etc. It's hard to lure people away from jobs like that where you're paid a lot and have a ton of freedom for a potential exit that's smaller than what you currently make, unless your startup becomes Google.

mrchicity 12y ago
To add to that, finance in Chicago is very different than finance at big banks. Many of the big players are tech companies first and foremost. Engineers are often on the "money side" of the business and respected/rewarded as such. Anyone trying to attract talented STEM employees in Chicago should read these to see what they're up against: http://www.nancyhua.com/2012/12/11/the-and-my-future/ http://www.nancyhua.com/2012/12/11/the-and-my-future/ http://qr.ae/3MPL1 http://qr.ae/3MPL1

deleted 12y ago

[deleted]

mrchicity 12y ago

I think this will change as prop trading firms wane & consolidate. They attract the top STEM talent in Chicago and can pay them extremely well through profit sharing. There are a lot of engineers and "Xs who program" (where X ~= trader/researcher) taking home high-six and low-seven figure bonuses at the best groups. The people are usually very entrepreneurial and the firms have a "tech culture" where good code isn't a cost center. Why would guys getting market base, upside that pays yearly or quarterly, and autonomy trade that for $90k and a lottery ticket to build some glad-hander's dream? Markets are slow and competition is fierce, so I think you will see a lot guys from these Getco-ish firms leaving because the opportunity just isn't there anymore or the firm culture has changed. Most of these people keep a low profile and have cash socked away. Some will end up bootstrapping their own businesses here in Chicago, building them in the image of the firms where they cut their teeth: nimble, revenue-focused, scientific, and sharing success with employees.