"Groupon was a huge huge success and potentially a huge huge failure. That neither made Chicago nor does it need to break Chicago."
If you're not from Chicago and you think, "Chicago startups," the company that probably comes to mind is Groupon. Groupon had a heralded IPO and, in recent months, an equally heralded decline. So, perhaps the question I was most interested in answering during our time in the city was, "How has Groupon's meteoric rise and fall changed the startup scene?"
For the answer to that question, I went to Terry Howerton, who has been around the Chicago startup scene since the mid-2000s. He founded the Illinois Technology Association seven years ago, and later, the community hub, TechNexus in 2007. He's met thousands of people in the city's tech scene and has watched more than a few trends rise and fall. In other words, if anyone can say how the Chicago startup scene has been changed by Groupon's story, it's him.
"Groupon was a flare that went up and lit up the ground below, and people looked around and said, 'Huh, there's a lot here.'" Howerton said. "The danger is once that flare starts to extinguish as maybe happened with Groupon -- as probably happened with Groupon -- are there any lights remaining?"
Traditionally, the thought has been that once a city has a company with a big IPO -- think PayPal or Microsoft or Google -- that pumps a lot of money into the place's startup ecosystem. You've got a bunch of youngish people walking around with huge bank accounts and substantial risk tolerance. While he acknowledged the venture capital firm, Lightbank, which was formed by Groupon co-founders Eric Lefkofsky and Brad Keywell, Howerton said that Groupon has not been a boon to Chicago's startup scene, at least not yet.
"I don't think there has been a lot of capital that has flooded into Chicago through the Groupon exit," Howerton said. "You think about the success of a company like Microsoft and the early days of Microsoft in Seattle. It was not that 10 guys got wealthy but hundreds and hundreds of people became millionaires. We haven't yet seen that from Groupon. In some ways, it's not a tech company. You just don't have hundreds of engineers who made a million dollars."
Even so, Howerton seems content with that reality. After all, he thinks Chicago shouldn't lionize business-to-consumer startups just because the media (like your loyal correspondent) like them more. In fact, Howerton is excited about a whole different class of companies and types of work.
"A lot of the technology that exists here today isn't B2C, it's B2B, it's industry transformative and it's incredibly important," he said. "It's companies like ArrowStream that do $100 million a year doing supply chain management for paper products for fast food restaurants. If they were doing $100 million a year in any B2C, they'd be written about as if they were the second coming."
It's actually amazing. If you look at ArrowStream's customer list -- IHOP, Wendy's, Cinnabon, Panda Express, KFC, Friendly's, etc. -- they're probably helping a restaurant on every street in America. But he's right: Who has ever heard of ArrowStream?
In fact, Howerton thinks that companies like that could be Chicago's tech scene bread and butter. There are already so many established large corporations in Chicago in logistics, finance, and healthcare that he sees the city as a place that could provide unique collaborations between startups and big business.
Howerton said that there are several macro trends driving corporations to work with new companies. For one, big businesses have unprecedented amounts of cash on their balance sheets. It's not just Apple that's sitting on money. Recent reports peg the amount of dollars on corporate balance sheets at nearly $2 trillion! Those companies, like State Farm Insurance or Walgreens, want to innovate and stay ahead of potential disruptive competitors, but they just don't know how.
"State Farm has 12,000 employees in IT in Bloomington," Howerton said. "I'm sure many of those employees are really smart people, but how innovative can you be with 12,000 IT workers in your bureaucratic corporate environment in an industry as historic as insurance?"
Or take Walgreens. They recently released an API for their "QuickPrint" feature, which allows you to send photos to Walgreen's and pick them up in a store. "They invited us to organize hackathons for them to bring dozens of technology teams to brainstorm business and app ideas that integrate QuickPrints," he said. The teams get access to the people who built the API and the winners of the competitions make some money. Meanwhile, Walgreens gets technologists building apps using their platform in a way that they probably wouldn't themselves.
With the right corporate friends and deep knowledge of the technology scene in Chicago, TechNexus isn't trying to be like it's flashy neighbor, 1871 Chicago. They're not trying to draw the latest web startup. What they want to do is create an environment where all kinds of technology startups -- especially those with hardcore engineering and computer science at their cores -- can find serious investors and partners.
All this to say: Howerton's idea of a real technology scene in Chicago doesn't end with a certain daily-deals company that happened to go public last year.
"Groupon was a huge huge success and potentially a huge huge failure," Howeton said. "That neither made Chicago nor does it need to break Chicago."
Three Atlantic staffers discuss “The Winds of Winter,” the tenth and final episode of the sixth season.
Every week for the sixth season of Game of Thrones, Christopher Orr, Spencer Kornhaber, and Lenika Cruz discussed new episodes of the HBO drama. Because no screeners were made available to critics in advance this year, we'll be posting our thoughts in installments.
It’s not because they’re inherently harsher leaders than men, but because they often respond to sexism by trying to distance themselves from other women.
There are two dominant cultural ideas about the role women play in helping other women advance at work, and they are seemingly at odds: the Righteous Woman and the Queen Bee.
The Righteous Woman is an ideal, a belief that women have a distinct moral obligation to have one another’s backs. This kind of sentiment is best typified by Madeleine Albright’s now famous quote, “There is a special place in hell for women who don’t help each other!” The basic idea is that since all women experience sexism, they should be more attuned to the gendered barriers that other women face. In turn, this heightened awareness should lead women to foster alliances and actively support one another. If women don’t help each other, this is an even worse form of betrayal than those committed by men. And hence, the special place in hell reserved for those women.
It happened gradually—and until the U.S. figures out how to treat the problem, it will only get worse.
It’s 2020, four years from now. The campaign is under way to succeed the president, who is retiring after a single wretched term. Voters are angrier than ever—at politicians, at compromisers, at the establishment. Congress and the White House seem incapable of working together on anything, even when their interests align. With lawmaking at a standstill, the president’s use of executive orders and regulatory discretion has reached a level that Congress views as dictatorial—not that Congress can do anything about it, except file lawsuits that the divided Supreme Court, its three vacancies unfilled, has been unable to resolve.
On Capitol Hill, Speaker Paul Ryan resigned after proving unable to pass a budget, or much else. The House burned through two more speakers and one “acting” speaker, a job invented following four speakerless months. The Senate, meanwhile, is tied in knots by wannabe presidents and aspiring talk-show hosts, who use the chamber as a social-media platform to build their brands by obstructing—well, everything. The Defense Department is among hundreds of agencies that have not been reauthorized, the government has shut down three times, and, yes, it finally happened: The United States briefly defaulted on the national debt, precipitating a market collapse and an economic downturn. No one wanted that outcome, but no one was able to prevent it.
The June 23 vote represents a huge popular rebellion against a future in which British people feel increasingly crowded within—and even crowded out of—their own country.
I said goodnight to a gloomy party of Leave-minded Londoners a few minutes after midnight. The paper ballots were still being counted by hand. Only the British overseas territory of Gibraltar had reported final results. Yet the assumption of a Remain victory filled the room—and depressed my hosts. One important journalist had received a detailed briefing earlier that evening of the results of the government’s exit polling: 57 percent for Remain.
The polling industry will be one victim of the Brexit vote. A few days before the vote, I met with a pollster who had departed from the cheap and dirty methods of his peers to perform a much more costly survey for a major financial firm. His results showed a comfortable margin for Remain. Ten days later, anyone who heeded his expensive advice suffered the biggest percentage losses since the 2008 financial crisis.
Unexpected discoveries in the quest to cure an extraordinary skeletal condition show how medically relevant rare diseases can be.
When Jeannie Peeper was born in 1958, there was only one thing amiss: her big toes were short and crooked. Doctors fitted her with toe braces and sent her home. Two months later, a bulbous swelling appeared on the back of Peeper’s head. Her parents didn’t know why: she hadn’t hit her head on the side of her crib; she didn’t have an infected scratch. After a few days, the swelling vanished as quickly as it had arrived.
When Peeper’s mother noticed that the baby couldn’t open her mouth as wide as her sisters and brothers, she took her to the first of various doctors, seeking an explanation for her seemingly random assortment of symptoms. Peeper was 4 when the Mayo Clinic confirmed a diagnosis: she had a disorder known as fibrodysplasia ossificans progressiva (FOP).
Patsy Sherman, along with her colleague Sam Smith, discovered Scotchgard more than 50 years ago during a spill while developing a new kind of rubber for jet fuel lines. Her accident revolutionized cleaning and reminded inventors everywhere not to be disappointed if something doesn’t come out the way you expect it to.
Nancy Tomes, author, Remaking the American Patient
In 1848, the chemist Louis Pasteur got a job at a university in French wine country, where he started wondering why wine goes sour. He followed a hunch—it’s because of a microbe—and leapt from there to the hypothesis that microbes make us “sour,” too. Voilà, the germ theory of disease. We get much longer lives, plus better wine (and beer and milk!) in the bargain.
How the Brexit vote activated some of the most politically destabilizing forces threatening the U.K.
Among the uncertainties unleashed by the Brexit referendum, which early Friday morning heralded the United Kingdom’s coming breakup with the European Union, was what happens to the “union” of the United Kingdom itself. Ahead of the vote, marquee campaign themes included, on the “leave” side, the question of the U.K.’s sovereignty within the European Union—specifically its ability to control migration—and, on the “remain” side, the economic benefits of belonging to the world’s largest trading bloc, as well as the potentially catastrophic consequences of withdrawing from it. Many of the key arguments on either side concerned the contours of the U.K.-EU relationship, and quite sensibly so. “Should the United Kingdom remain a member of the European Union or leave the European Union?” was, after all, the precise question people were voting on.
American society increasingly mistakes intelligence for human worth.
As recently as the 1950s, possessing only middling intelligence was not likely to severely limit your life’s trajectory. IQ wasn’t a big factor in whom you married, where you lived, or what others thought of you. The qualifications for a good job, whether on an assembly line or behind a desk, mostly revolved around integrity, work ethic, and a knack for getting along—bosses didn’t routinely expect college degrees, much less ask to see SAT scores. As one account of the era put it, hiring decisions were “based on a candidate having a critical skill or two and on soft factors such as eagerness, appearance, family background, and physical characteristics.”
The 2010s, in contrast, are a terrible time to not be brainy. Those who consider themselves bright openly mock others for being less so. Even in this age of rampant concern over microaggressions and victimization, we maintain open season on the nonsmart. People who’d swerve off a cliff rather than use a pejorative for race, religion, physical appearance, or disability are all too happy to drop the s‑bomb: Indeed, degrading others for being “stupid” has become nearly automatic in all forms of disagreement.
The International Monetary Fund’s Christine Lagarde asks leaders to proceed in “the most efficient, predictable way.”
The Brexit decision was “heartbreaking for those of us who are truly Europeans,” said Christine Lagarde, the managing director of the International Monetary Fund, on Sunday evening. And she offered a plea for global leaders, asking them to restore certainty to an uncertain situation.
Markets usually get things right—but they got the result of the Brexit vote very, very wrong. Its failure to predict the Brexit produced a sudden plunge in the pound that was “violent, brutal, immediate, massive,” she said, it also showed the fundamental resilience of the system. “There was no panic, despite the fact that markets had not anticipated that vote … and the central bankers did the job that they were prepared to do just in case,” she insisted, flooding the markets with liquidity.
The results of the referendum are, in theory, not legally binding.
Lest we think the Euroskepticism displayed this week by British voters is new, let me present a scene from the BBC’s Yes, Minister, a comedy about the U.K. civil service’s relationship with a minister. The series ran from 1980 to ’84 (and, yes, it was funny), at a time when the European Union was a mere glint in its founders’ eyes.
The Europe being referred to in the scene is the European Economic Community (EEC), an eventually 12-member bloc established in the mid-1950s, to bring about greater economic integration among its members.
In many ways, the seeds of the U.K.’s Thursday referendum on its membership in the European Union were sown soon after the country joined the now-defunct EEC in 1973. Then, as now, the ruling Conservative Party and opposition Labour, along with the rest of the country, were deeply divided over the issue. In the run-up to the general election the following year, Labour promised in its manifesto to put the U.K.’s EEC membership to a public referendum. Labour eventually came to power and Parliament passed the Referendum Act in 1975, fulfilling that campaign promise. The vote was held on June 5, 1975, and the result was what the political establishment had hoped for: an overwhelming 67 percent of voters supported the country’s EEC membership.