In the numbers

Recent statewide survey reveals optimism among emerging entrepreneurs and highlights growth opportunities

Results from the 2011 Illinois Entrepreneurial Survey show a sense of optimism among Chicago's emerging innovation ecosystem as entrepreneurs seek to develop and expand their businesses. Built in Chicago, the Chicagoland Entrepreneurial Center, the Chicago Innovation Awards, the Illinois Science & Technology Coalition, the Illinois Technology Association, Startup Illinois, and World Business Chicago joined forces on the survey, which was developed to gauge the entrepreneurial landscape in Chicago and Illinois.
  Drawing on a cross-section of perspectives
The survey targeted leaders of active entrepreneurial ventures and was conducted from a diverse range of industries, from software to education and healthcare. Notably, nearly 80 percent of survey respondents founded their business in the past five years, highlighting the growing community of talent and leadership in Illinois.
  Poised for growth
Despite the uncertainty of the global economy, many survey respondents expect to expand their business, with nearly 65 percent indicating they would add employees in 2011. In addition, 85 percent of jobs created by start-ups this year are based in Chicago. Revenue forecasts were also encouraging: while just 9 businesses in the sample generated more than $1 million in revenue in 2010, the number of companies in this category is forecast to jump to 21 this year. Nearly 10 percent of businesses founded in the past two years anticipate revenues of more than $500,000 for 2011.
  Securing financing for growth
A number of respondents indicated that they were actively seeking funding to develop their businesses. Of the 92 respondents looking to secure capital, more than three-quarters are in the pre-seed, seed, or early stages of business development.

The most sought-after sources of funding are angel investors and venture capital firms. Among the companies that actually secured financing, however, 45 did so through friends and family. Relatively few businesses pursued bank financing, and even fewer were successful—banks supplied funding for just 10 ventures.

  Seeking expertise and direction
The survey showed that Illinois entrepreneurs have taken advantage of available support to secure mentors and learning opportunities. The majority (95 of 107) of businesses founded in the past five years indicated that they have tapped services and support from numerous resources, including entrepreneurial organizations, colleges and universities, and innovation competitions sponsored by universities and other parties.
  Nurturing innovation in Illinois
The entrepreneurial and innovation community should take several important actions to build on the current momentum. Respondents are seeking better access to experienced entrepreneurial advice and guidance, including ways to connect with local Fortune 500 leaders. In addition, survey participants expressed a need for office space and professional services. Similarly, tools that connect ideas and entrepreneurs to capital more effectively could help increase the volume of start-ups.

Source: All data are from the 2011 Illinois Entrepreneurial Survey.

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Brought to you by:
Chicagoland Chamber of Commerce
Chicago Metropolitan Agency for Planning
Illinois Science & Technology Coalition
World Business Chicago
In partnership with:
Illinois Innovation Network
  News & events  
  Chicago Ideas Week  
  October 16 marked the end of the inaugural Chicago Ideas Week. The event brought together Chicago's thinkers and leaders in the spirit of innovation and collaboration and also included two days of TEDx Midwest and TEDx Youth. Highlights included Governor Pat Quinn's Lab at Engineered Glass Products, where he talked with EGP's leaders about the future of manufacturing in Illinois, and an international mayoral Megatalk, which featured Chicago Mayor Rahm Emanuel discussing the importance of innovation to cities.

  Power2Switch is an online platform that allows businesses and individuals to compare prices from electricity suppliers in Illinois. The site provides tools to compare price and contract terms from numerous suppliers, allowing customers to make an educated decision about their supplier. Its free, user-friendly, Web-based service has helped businesses to track savings as well as energy and carbon usage. Since suppliers compete for business, customers can reduce their rates by up to 30 percent. Through Power2Switch, one McDonald's franchisee is saving $127,000 across his locations.

Power2Switch was launched in Chicago in 2010 by University of Chicago Booth School of Business alumni Seyi Fabode and Phil Nevels. The company has worked with the Chicagoland Entrepreneurial Center for the past year to connect to mentors and resources, resulting in significant revenue growth and market traction. Power2Switch was also one of ten companies selected for a highly competitive Excelerate 2011 program.
  Did you miss last month's newsletter on venture capital?  
The next edition of the Illinois Innovation Index will highlight data on Illinois' emerging industry clusters.

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