After a record amount of venture capital was dolled out to Chicago startups in 2021, the tech industry downturn has resulted in a 38% drop in fundraising through the first nine months of the year in Chicago.
But even at a moment when venture funding is down, several industry-disrupting companies have been able to fill their piggy banks during challenging times and find ways to grow their businesses, and despite a slowdown and string of recent layoffs seen across the tech sector in recent months, some think this could bring opportunity for Chicago’s startup community.
Chicago startups have created a delivery app that modernizes and elevates the classic corner store experience, a text messaging-based platform that helps companies better engage with their blue-collar workforce, and a resource-sharing network that helps organizations recycle and source items — and they’re the ones that continue to get the most VC attention.
Now in its eighth year, Chicago Inno’s Fire Awards recognizes the innovators, change-makers, disruptors and more who’ve made their mark on the city’s tech scene over the past year. The list of 50 companies and organizations is designed to highlight the fast-growing, game-changing firms that have made big headlines this year — whether that’s through a funding round that helped propel a company to new heights, a successful acquisition, a new product or a fund dedicated to backing the city’s underrepresented founders.
The companies on the list include some early-stage startups that have just started their journey and others that have become giants in Chicago’s tech scene. Winners this year are organized into five categories: Supporters, B2B, B2C, Health Care and Deep Tech. Soon, we’ll reveal the Blazer winners, the top firms from each category, as voted by a panel of judges.
Winners were sourced by nominations and selected by the Chicago Inno editorial team. Dive into the list below.
Investors, incubators and others helping shape Chicago’s next wave of innovation
MHub, Chicago’s incubator for hardtech and physical products, celebrated its five-year anniversary in 2022. Since launching in 2017, the mHub community has generated more than $730 million in revenue, launched around 1,400 products and hired about 4,000 employees. By March of this year, the mHub startup community had officially raised more than $1 billion in capital. In September 2022, mHub closed its first venture fund: the Product Impact Fund I, a $15 million fund to support the mHub accelerator portfolio of startups. It also welcomed eight teams to its first Climate and EnergyTech cohort and plans to double down on ways to reduce barriers for hardtech founders.
Still hot from a transformative 2020 when it doubled its portfolio from 30 to 60 startups and invested more capital in that calendar year than in the prior six years combined, Lofty Ventures continues to look for new Chicago startups to invest in. Lofty Ventures has invested in such startups like Cubii, which was acquired for a reported $100 million, and Popular Pays, which was acquired this year. Lofty Ventures also invested in Science on Call in 2022. Led by Chris Deutsch and Spencer Gordon-Sand, Lofty Ventures has now invested in more than 130 founders at 73 companies, with 70% led by underrepresented founders, and five exits. Lofty’s Syndicate has deployed $1.5 million this year in four deals including co-investments with a16z, Pritzker Group and Cleveland Avene.
Chicago health care incubator and innovation hub Matter launched two premium accelerators in 2022: Momentum for digital health startups, with 12 in the inaugural cohort, and 51 Labs, which will focus on advancing solutions that empower and support women during their menopausal transition. More than $4.4 billion has been raised by Matter startups, and they have generated $280 million in 2021 revenues.
Chicago’s venture capital industry is 78% men and 66% white. Chicago:Blend wants to change that. The local organization first launched in 2018 as a collaborative effort by venture capitalists in Chicago to measure and increase diversity, equity and inclusion at Chicago VC firms. This year, Chicago:Blend since launched the Chicago Venture Fellows, a four-month fellowship program designed to provide aspiring venture capitalists from underrepresented groups with the knowledge, networks and experience needed to land a role in VC. To date, 27 fellows have participated across three cohorts. Two more cohorts of 10 fellows each are planned for 2023. Of those who have participated, five fellows have since landed a role in VC and two of the companies that were sourced during the pilot phase have since received funding.
Not often thought of in tech/startup circles, makeup giant Ulta Beauty announced the launch of a venture capital fund this year to connect with startups and retail innovators. The $20 million fund, called Prisma Ventures, will invest in companies working with personalized and data-driven technology; AR, VR and the metaverse; technology-powered custom beauty products and in-store services; and social commerce. Ulta’s stock hit an all-time high in November.
Arch Venture Partners
Chicago biotech-focused venture firm Arch Venture Partners reloaded with a new $3 billion fund to back more companies working in infectious disease, mental health, immunology, oncology and other areas. It’s the VC firm’s 12th fund. Arch’s portfolio includes Chicago-based Jaguar Gene Therapy, a gene therapy startup helping patients suffering from severe genetic diseases that raised $139 million last year, and Seattle’s Juno Therapeutics, which sold to Celgene for $9 billion in 2018.
Venture capital firm LongLump, a fund that invests in diverse founders, announced this year it has invested in 15 companies, totaling $1.5 million deployed in the past year. It’s led by a group of Chicago startup founders including Draftbit co-founder Brian Luerssen, Draftbit COO Tim Grace, Rheaply founder Garry Cooper, 4Degrees co-founder Ablorde Ashigbi, Paladin CEO Kristen Sonday, and A.M. Money co-founder Daniel Rogers. In 2022, LongJump brought on two new venture partners: angel investor and Wise Apple co-founder and former CEO Rebecca Kahnweiler and Betsy Fore, the first Native American woman to raise a Series A in the country.
Covid brought Chicago startup events to a halt. ChiTechIRL is working to change that, creating a startup event and networking group that aims to bring the Chicago tech community together through in-person events designed to connect the entire ecosystem — from founders and investors to early-career employees and more. The group is led by four Chicago tech leaders: Abhinaya Konduru, an investor at Chicago VC firm M25; Claude Cimeus, the director of platform at P33; Eric Duboe, head of corporate development at Relativity; and Tony Coglianese, first vice president at CBRE in Chicago.
Businesses helping other businesses grow
Anthill spent much of 2022 receiving accolades from its peers. A recent finalist in 1871’s Momentum Award Industry Disrupter category and winner of SXSW’s Future of Work category, the Gold Stevie award winner was included in TechCrunch Disrupt Startup Battlefield 200 earlier this year. Founded in 2020 by Muriel Clauson and Young-Jae Kim, the human resources startup provides a text messaging-based platform that helps companies better engage with their blue-collar workforce and supports a company’s “deskless” workforce. Anthill raised a $3 million round last year from backers including Origin Ventures, Rethink Education and BBG Ventures.
Crafty faced somewhat of an existential crisis when Covid-19 first hit. Founded in 2015, the centralized platform for workplaces that manages food, beverage and office supplies, was initially centered on in-office experiences. But as office utilization plummeted at the height of the pandemic, there were fewer in-office experiences to be had. This caused Crafty to lay off 100 employees, about two-thirds of its workforce. But a new asset-light approach helped Crafty scale from two markets to nearly 30, and now with a workforce of around 140, Crafty expects to reach 200 by the end of this year. The company announced a $10 million Series A round in April and has now raised $15 million since it launched in 2015. After a tough 2020, Crafty doubled down the importance of office space, relocating its headquarters to a 12,000-square-foot office in the heart of the Loop.
Chicago fintech company Enova International has been on a torrid pace in 2022. The company’s total revenue reached $456 million in the third quarter of 2022, increasing 12% sequentially and 42% from the third quarter of 2021. Company originations were way up as well as Enova CEO David Fisher credited the company’s diversified portfolio, strong balance sheet and liquidity for its success during this uncertain economic environment during its third-quarter earnings call.
Garry Cooper, now a household name in the Chicago startup community, first started planting the seeds for Rheaply while completing a Ph.D. in neuroscience at Northwestern University, when he developed a system for university labs to swap and sell unused lab equipment to each other. The resource-sharing network that helps organizations recycle and source items has now raised more than $30 million in venture capital raised since it launched in 2016, including a $20 million funding round led by Revolution’s Rise of the Rest Seed Fund, a fund led by AOL founder Steve Case. The company works with more than 150 partners, such as Google, AbbVie and UChicago, helping them to divert more than 20 metric tons of waste from landfills, with more than 50,000 items with a value of $19 million being upcycled through the platform.
Founded in 2001 by Andrew Sieja, Relativity continues to be a stalwart in Chicago’s tech ecosystem. In August 2022, Relativity, now led by CEO Mike Gamson, acquired legal software startup Heretik, marking Relativity’s third corporate acquisition in less than two years as it continues to find new ways to help law firms manage large volumes of data to quickly identify key issues during litigation, internal investigations and compliance operations. In the last year, Relativity also expanded the availability of RelativityOne, the firm’s cloud platform, in six new regions: Africa, Japan, Luxembourg, Ireland, the United Arab Emirates and India.
Cybersecurity startup Oak9 continues to stay busy. Founded in 2019 by Raj Datta, Aakash Shah and Om Vyas, Oak9 offers an “infrastructure-as-code” security platform to companies. The Chicago startup has raised $14 million in funding in the past two years after announcing an $8 million round of financing at the end of June. With nearly 50 employees to begin the year, one of Datta’s goals heading into 2022 was to double the company’s head count with an expected increase of 500% in revenue.
Chicago marketing tech firm ActiveCampaign, valued at $3 billion, crossed $200 million annual recurring revenue this year with 180,000 customers, making it the largest provider of customer relationship management and automated sales and marketing. ActiveCampaign has opened new offices in Indianapolis; Dublin, Ireland; and Florianópolis, Brazil. And it acquired Philadelphia email marketing firm Postmark earlier this year.
Founded in 2018 by Andrew Sobko, CDL 1000 has become a key player in the logistics-tech space. The company has experienced a three-year growth rate of 56,135%, making it the third-fastest growing company on the 2022 Inc. 5000 list and the fastest-growing company in Illinois. CDL 1000 also recently introduced a new service — Demurrage as a Service (DaaS) — to help customers save money by avoiding late fees and recently committed $100 million to digitize the drayage space.
Chicago continues to establish itself as a hotbed for cannabis companies with the help of startups like Leaf Trade. The software startup for marijuana dispensaries raised more than $12 million in its Series B earlier this year and has now raised more than $22 million since it launched in 2016. Led by founder and CEO James Yi and President Michael Piermont, Leaf Trade launched a new service called Leaf Pay in 2022 which allows cannabis companies to pay their bills via ACH rather than cash/money order.
QualSights, an automated quantitative and qualitative research platform for consumer insights, was named the fastest-growing software company in Illinois earlier this year. Founder and CEO Nihal Advani also closed a Series A in November that was just short of $8 million after doubling the size of his team to begin the year.
Logistics startup Loadsmart hit unicorn status in 2022 after relocating its headquarters from New York to Chicago. Founded in 2014 by Ricardo Salgado and Felipe Capella, the startup that helps companies automate their logistics processes raised $200 million in Series D funding at a $1.3 billion valuation in February.
Chicago startup 86 Repairs started a subscription service for restaurants like McDonald’s and Jimmy John’s to manage repairs and maintenance and raised $15 million in new funding in July to grow the platform. Founded in 2018 by Daniel Estrada and Joe Gallagher, the startup works with more than 2,000 restaurants in the U.S. and Canada, helping them to troubleshoot issues, schedule repairs and track how much they’re spending on equipment maintenance.
Dscout, which has built a video research platform to help companies better understand their consumer base, raised a $70 million series C earlier this year. Led by founder and CEO Michael Winnick, Dscout spun out of consulting firm Gravitytank in 2013.
Chicago startup Paladin helps lawyers increase their pro bono work with technology that helps law firms and in-house legal counsels streamline, source and track it. The company has created a central dashboard where lawyers can discover new pro bono opportunities, with both in-person and remote opportunities. This year Paladin raised $8 million in a Series A from Mark Cuban and other backers.
Five to Nine
Chicago startup Five to Nine makes software that helps companies manage and measure employee events and other initiatives, like DEI programs and all-hands meetings. Its customers include companies like Yahoo, Expedia and DoorDash, which use the startup to help organize events and get data on the impact of their Employee Resource Group initiatives. The company raised a $4.25 million round of funding in June.
Popular Pays connects brands with online influencers to run campaigns on Instagram, Pinterest, TikTok and other platforms. This year it was acquired by Lightricks, a venture-backed firm that makes popular photo and video editing apps like Facetune and Videoleap.
Logistics startup Project44 raised $500 million in 2022 across multiple funding rounds. Its latest, an $80 million round in November, valued the company at $2.7 billion. Project44’s software helps shippers and third-party logistics companies track their shipments and communicate with the supply chain in real-time. Its customers include Amazon, P&G, Starbucks and Unilever.
Logistics startup FourKites makes software that helps companies predict when shipments will arrive at scheduled stops. It can also monitor load temperatures and analyze a company’s supply chain data, helping businesses improve on-time delivery and minimize product loss. In June, it raised funding from FedEx at a valuation of more than $1 billion. FourKites, founded in 2014, has raised more than $200 million to date.
Businesses building products you love
After a difficult pandemic period when events came to a complete halt, Chicago online ticket marketplace Vivid Seats has had a busy 13 months since it began trading on the Nasdaq under ticker symbol “SEAT” in October 2021. Vivid Seats’ first quarter as a public entity produced company records with nearly $140 million in revenue, marketplace gross order value of $713 million and adjusted EBITDA of $42 million. Vivid Seats reached 100 million tickets sold in January and as of mid-October had grown its head count by nearly 35% year-to-date. The ticket marketplace signed a deal to move into Chicago’s historic Marshall Field building earlier this year and acquired Betcha, a daily fantasy sports app, a year ago for $25 million as it expands its business beyond ticket sales.
Led by an early Cameo and Trunk Club executives, Chicago startup Protégé connects up-and-coming talent with the experts who can provide feedback and mentorship. Experts have included DJ Khaled, actor Jason Alexander, singer Bebe Rexha and other celebrities. Co-founded by Jackson Jhin and Mike Cruz, Protégé raised $8.5 million this year in a round led by Sequoia Capital.
Founded in 2014, Foxtrot first launched as a delivery app created to modernize and elevate the nostalgic corner-store experience with local purveyors, trending brands from around the world and quick delivery. It has since opened multiple brick-and-mortar locations and gained a cult-like following nationwide. In the last year, Foxtrot has seen tremendous growth, doubling its footprint with 22 stores across Chicago, Dallas, the District of Columbia and Virginia. By the end of 2022, Foxtrot will have 26 physical locations and will continue expanding into new markets including Austin with the goal of 100 total stores by the end of 2024. The brand closed $100 million in Series C funding this year, bringing total funding to $160 million, investing the money in its proprietary retail technology that offers speedy deliveries, excellent loyalty program and a content-rich shopping experience that drives engagement.
After experiencing anxiety, depression and general issues around identity after retiring from football, former Chicago Bear Ryan Mundy struggled further to find the help he needed and founded Alkeme. A platform that connects users with professionals in psychology, mindfulness and wellness to bridge the gap between the Black community and the world of health care, Alkeme has raised nearly $5 million and amassed a community of 50,000 people so far.
Farmer’s Fridge’s mission is to make fresh and healthy food as accessible as a candy bar. The company, which makes healthy vending machines that are placed in office buildings, airports and other high-traffic areas, expanded into new markets in 2022, including St. Louis. Founded in 2013, Farmer’s Fridge creates “smart” fridges that are stocked with healthy meals and snacks with more than 500 vending machine locations in 20-plus cities. After almost three years of waiting in February 2022, Farmer’s Fridge was granted their first utility patent for a data-driven inventory control system that has changed the future of fresh food distribution. Year-to-date, revenue has grown 120% year-over-year.
Known for its bitcoin ATMs, Chicago cryptocurrency startup CoinFlip now has more than 4,000 machines across 49 states — 2,000 of which were added in the last year – supporting the buying and selling of major cryptocurrencies with cash. Founded in 2015, the company was also ranked within the top 100 on the Inc. 5000 two years in a row. Despite the economic downturn and volatility in the crypto landscape in 2022, CoinFlip continued to showcase successful growth and innovation. This year was a landmark year for CoinFlip, which entered international markets and announced its first corporate expansion in Tampa Bay.
Founded in 2016, Songfinch grew its revenue to $40 million in 2022, up from $5.6 million, and grew its headcount from 25 to 80 over the same period. The platform that lets you buy personalized songs from musicians raised a $17 million Series A in September and has paid out more than $20 million to more than 2,000 independent artists. Songfinch has delivered nearly 150,000 original songs.
After relocating from San Francisco to Chicago, Food Rocket raised $25 million earlier this year for its 15-minute grocery delivery service. Led by founder and CEO Vitaly Alexandrov, the startup promises door-to-door delivery of groceries in 15 minutes or less. The deal allows Food Rocket to work closely with Circle K to expand the company’s e-commerce and delivery options.
After seeing its business nearly go to zero during the Covid pandemic, SpotHero has come back to life. The parking app, following multiple rounds of layoffs during the pandemic, has grown its staff and revenue back to pre-pandemic levels, and this year it landed a deal with Lyft, where its parking service can now be found in the popular ride-hailing firm’s app. The move is designed to drive more users to SpotHero’s parking app.
Startups making health care better
Chicago startup MetaMe Health wants to develop pain relief for the 10% to 15% of U.S. adults who live with IBS. Earlier this year, MetaMe received $2.2 million in a bridge round led by Hyde Park Angels with additional investments from individuals. These funds will be used to continue preparation for the market launch of MetaMe’s prescription digital therapeutic Regulora and to build out its commercial infrastructure.
Chicago-based Maia Biotechnology completed its initial public offering this year at a time when that has become exceedingly more difficult for companies. Founded in 2018, the clinical-stage biopharmaceutical company continues to advance the clinical development of its drug under development, THIO, which is designed to give cancer patients a new therapeutic treatment option. The cancer drug was recently granted an Orphan Drug Designation by the U.S. Food and Drug Administration.
The brainchild of John Rogers, one of Chicago’s best-known inventors, Sibel Health raised $33 million in its Series B announced in August. Founded in 2018, the startup will use the new funding to advance its FDA-cleared Anne platform, which includes wearable sensors, AI-enabled data analytics and an integrated mobile software and cloud platform.
Cour Pharmaceuticals is developing antigen-specific therapies that could be a real game changer for those with celiac disease. The clinical-stage biotech company raised $30 million in financing in September to continue to develop immune-modifying nanoparticles that target the immune system’s learning power to induce tolerance to specific problematic antigens. In October, the company announced it received clearance from the U.S. Food and Drug Administration to initiate a proof-of-concept study of Cour’s investigational therapy designed to treat myasthenia gravis.
Waltz Health got backing from Google earlier this year to help bring its online search engine to market, which aims to help people find lower-cost prescription drugs and compare prices for their medications. The Chicago startup announced a $35 million Series A in April led by GV, formerly known as Google Ventures, as it works with retail pharmacies to provide transparency around pricing. Waltz is led by Mark Thierer, the former CEO of OptumRx, and his son Jonathon Thierer, who’s serving as co-founder and vice president of product.
Tempus reloaded with more cash in 2022 as Chicago’s most valuable tech startup continued its quest to combat cancer and other conditions. The startup, led by Groupon founder Eric Lefkofsky, raised $275 million in equity and debt in October, valuing the business at $8.1 billion, the same valuation it had in 2020 when it raised $200 million. Tempus, which uses machine learning and genomic sequencing to better understand cancer tumors, now has about 1,700 employees.
Chicago startup CancerIQ’s technology helps physicians identify and manage their patients based on individual genetic risk factors for cancer. The startup created a risk assessment questionnaire that patients can complete to identify if they are at a higher risk for certain cancers. This year it raised $14 million. Led by Feyi Olopade Ayodele and Olufunmilayo Olopade, the round is among the largest venture funding rounds raised by Black women in Chicago.
Health care tech firm Higi was acquired this year by British company Babylon, which went public last June in a $4.2 billion SPAC deal. Founded in 2012, Higi creates self-screening health stations that measure a person’s blood pressure, pulse, weight, BMI and other health metrics. It operates nearly 10,000 health stations across the country.
Jaguar Gene Therapy
Jaguar, a Chicago biotech firm, develops gene therapy treatments for people suffering from diabetes and other genetic diseases. The startup has raised more than $140 million to date from investors including Samsung, which backed the startup in March. Jaguar is led by the former leadership team at AveXis, an Illinois-based maker of gene replacement therapy for spinal muscular atrophy that was acquired by Novartis in 2018 for nearly $9 billion.
High-tech companies solving big problems
Agtech startup Sabanto will use the $17 million in Series A funding it raised in August to make autonomy an affordable, reliable and scalable solution for farmers throughout the world. Founder and CEO Craig Rupp thinks the future of farming is in smarter, smaller, lighter, less expensive and more sustainable swarms of autonomous equipment. Founded in 2018, the ag startup also received its first investment from Cooperative Ventures this fall.
Chicago startup Super.tech, maker of quantum computing software, was acquired by ColdQuanta, a Colorado quantum tech firm, earlier this year. Super.tech was part of the first cohort of Duality, a tech accelerator in Chicago designed specifically for quantum startups, the first of its kind. As part of the acquisition, ColdQuanta announced plans to open its first office in Chicago. Super.Tech is backed by the Department of Energy.
Cleantech firm LanzaTech develops carbon recycling technology that converts carbon waste into sustainable fuels and chemicals. It has worked with companies like Unilever, L’Oréal, Lululemon and Indian Oil to develop everyday products such as a new laundry detergent pod. Lululemon uses LanzaTech technology to create fabric, resulting in the first fabric born from recycled carbon emissions. Britain’s Prince William selected LanzaTech as one of 15 finalists for this year’s Earthshot Prize, a global environmental challenge.
EeroQ, a startup creating a quantum computing chip, moved its headquarters from Michigan to Chicago this year. The startup raised more than $7 million in August to help build its quantum chip using electrons floating on helium, and wants to build a large-scale quantum computer based on its quantum chip.
Chicago startup ClearFlame retrofits diesel engines to run on cleaner fuel. Its technology enables heavy-duty engine manufacturers to produce engines at lower cost, letting diesel engines run on cleaner burning fuel. The startup is backed by Bill Gates’ Breakthrough Energy Ventures, which led a $17 million round in ClearFlame.
Natural Fiber Welding
Natural Fiber Welding, a downstate startup that makes sustainable fashion materials for brands including Ralph Lauren and Alexander McQueen, raised $85 million in April. Investors in the round included BMW i Ventures, the VC arm of BMW, and Ralph Lauren. Founded in 2015, NFW makes durable materials without any plastics. It has two core products: Clarus, which takes recycled cotton and turns it into new high-performance materials, and Mirum, a leather alternative made from hemp, waste cork, coconut and other natural products.
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