Two years ago, our Managing General Partner, Kathryn Finney, found herself retracing the steps of her great-grandparents, who, as a part of the Great Migration, moved from Kentucky and Tennessee in the 1920s to the opportunities that beckoned in Chicago and its sister city 90 miles north, Milwaukee. Kathryn moved from the South (Atlanta) to the city of Chicago, relocating our venture capital firm, Genius Guild, to the Windy City. As a successful tech entrepreneur, many of her friends were befuddled by her choice to move back to the Midwest. Atlanta had captured the zeitgeist, the emergence of a new “Wakanda,” and everyone from Microsoft to Sweetgreen was setting up shop in the city. Yet, Chicago had captured the zeitgeist in another way, an (unfair) image of an inner city ravaged by an epidemic of gun violence.
As one of Kathryn’s friends stated, “Why the hell would you want to move there?”
As investors, we’re always looking for value, which means we tend to focus on what’s next. To paraphrase a quote from hockey legend Wayne Gretzky, focus on not where the puck is, but where it’s going to be. As a Black woman, Kathryn sought community. She wanted her son to have access to diversity of thought and the diversity of a community that nourishes his mind. She also wanted to live near water and have access to two international airports. Chicago has it all.
Chicago: The Business Case
The business case for Chicago is strong. The cost of living index for Chicago is 107, while the cost of living index for San Jose, the seat of Silicon Valley, is 285.1. The average cost of a home in Chicago is $338,000 vs. the average cost of $1.2M for a home in San Jose.
Chicago offers an expansive international network, boasting a $634 billion economy and leading the U.S. in foreign direct investment. Chicago has been consistently ranked in the top 10 for most competitive cities for business in the world. It has the second-highest number of Fortune 500 company headquarters, with twenty-four corporate innovation centers. Chicago also has 100 + higher education institutions, including the University of Chicago and Northwestern University, and is ranked #4 in the U.S. for STEM talent.
Illinois has a number of programs that support BIPOC entrepreneurs, including the Advantage Illinois program, which provides favorable funding terms to Minority/Women/Disabled/Veteran-Owned Businesses through a loan participation model; a new Advantage Illinois loan guarantee model, which supports businesses that have had difficulty receiving loans in the past, including businesses that have faced historic barriers to capital; the Invest Illinois Venture Fund, a new venture capital direct equity program that will support emerging technologies and industries; and a Climate Bank Finance program to issues loans to small businesses in the clean energy space.
The Illinois SBDC and Chicago SBA offices provide help with small business services including funding programs, counseling, federal contracting certifications, and disaster recovery. They also connect businesses to partner organizations, lenders, and other community groups that help small businesses succeed. On the community level, the Chicago Business Centers Program is a City of Chicago Department of Business Affairs and Consumer Protection (BACP) initiative to fill the current gap in local business resources and minimize barriers for entrepreneurs and business owners of disadvantaged communities to properly launch, sustain, and/or expand their small businesses.
How Genius Guild Invests in Chicago
Genius Guild Managing General Partner, Kathryn Finney, participating in Chicago:Blend Black History Month Panel on Chicago’s diverse VC ecosystem
Genius Guild has spent the last 5 years building deep relationships in the Chicago Startup and Venture Capital ecosystem. We work closely with partners like TechRise by P33, GetCities, World Business Chicago (Chicago’s public-private economic development agency), and Chicago:Blend (an organization on a mission to advance diversity, equity, and inclusion in Chicago’s venture capital and startup community) to support local BIPOC entrepreneurs. Genius Guild has strong long-term partnerships with these organizations through serving as mentors and judges for pitch competitions, as business ambassadors at major conferences like SXSW, and as keynote speakers and panelists.
Our Managing Partner, Kathryn Finney, was voted as one of the most important Venture Capitalists in the Midwest by fellow investors and has written extensively about the strength of the BIPOC entrepreneurial ecosystem in Chicago. Genius Guild also works closely with local organizations like TechRise — which helps Chicago’s historically underrepresented tech founders find the funding, knowledge, and networks to help their businesses thrive. Kathryn served as a judge for the TechRise Finale, a competition where one founder received $100K in funding.
Genius Guild’s team retreat in Chicago
We’ve invested in Chicago-based firms like CapitalizeVC. Founded by Tessa Flippin, CapitalizeVC works to reduce the racial wealth gap by investing in early-stage Black and Latinx founders, while simultaneously creating access for diverse LPs. Genius Guild is also part of the Tech Equity Working Group hosted by GET Cities Chicago, which is designing city-wide solutions and collective infrastructure to address gender and racial inequities for Chicago-based tech founders.