Venture funding is a poor proxy for tech entrepreneurship anywhere but in a few VC hubs; we should just stipulate that the majority of those dollars are going to Palo Alto and Waltham no matter what Pat Quinn does. But no matter where you locate, most tech startups aren't going to get funded.
That said, Chicago does very little (if anything) to support tech startups.
There is a "Chicago style" of startup --- 37signals and Threadless being the most visible examples --- with bootstrap backgrounds and ethics. There are things that Chicago could be doing to foster those kinds of companies, which don't require financier gatekeepers, grow organically, and are less speculative and volatile than valley shoot-the-moon companies --- which work well for San Jose only because there's always another shoot-the-moon company to fall back to when your current one fails.
Illinois could:
* Provide tax and fee incentives to technology startups
* Adopt policies that encourage development of tech-friendly office space outside of the loop
* Make its own internal processes more accessible to tech entrepreneurs, in the same manner as Data.gov, to create opportunities for companies to add value. Chicago's own IT infrastructure is, for instance, a shambles.
* Look for opportunities to work with local companies to showcase products and create calling cards for selling into the huge prospective client base in the Chicago economy.
Thomas, I disagree with your proxy statement, but we can do that over IM. Also, why stipulate? We can look at the data to see if that's true (and I will).
Again, I do believe the per-capita data is the correct metric, as that accounts for differences in population. While no one would be surprised that California gets the most money, the per-capita figures might be of interest.
I'd love it if you wouldn't mind copy/pasting your comment to the post (even with the first graf). It is being passed around political circles in Springfield, and it'd be good for them to see it. The post is only looking at the data (which proves that the leadership has failed); it is deliberately silent on "why" and "how to fix". I want others to suggest those things before I take a swing.
If per-capita dollars was the right metric, the Greater Los Angeles combined statistical area would pull VC investments down to Southern California, which is more than twice as large as the valley.
Similarly, New York startup investments would dwarf Boston investments.
Money goes to San Francisco because of a feedback loop set in motion and sustained by a network effect. Fighting it is like fighting the tides. Illinois doesn't have the will or the wherewithal to compete with the valley on the valley's terms, and shouldn't bother trying.
That said, Chicago does very little (if anything) to support tech startups.
There is a "Chicago style" of startup --- 37signals and Threadless being the most visible examples --- with bootstrap backgrounds and ethics. There are things that Chicago could be doing to foster those kinds of companies, which don't require financier gatekeepers, grow organically, and are less speculative and volatile than valley shoot-the-moon companies --- which work well for San Jose only because there's always another shoot-the-moon company to fall back to when your current one fails.
Illinois could:
* Provide tax and fee incentives to technology startups
* Adopt policies that encourage development of tech-friendly office space outside of the loop
* Make its own internal processes more accessible to tech entrepreneurs, in the same manner as Data.gov, to create opportunities for companies to add value. Chicago's own IT infrastructure is, for instance, a shambles.
* Look for opportunities to work with local companies to showcase products and create calling cards for selling into the huge prospective client base in the Chicago economy.