"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."
Startups are proving more efficient than government in areas like transportation. Should some services be privatized?
Cities such as New York and San Francisco have extensive public-transportation systems that carry millions of residents by bus, train, boat, and light rail. But in recent years, there’s been an expanding fleet of private vehicles too: Lyft, Uber, Juno, Uber Pool, and the Google Bus, to name a few. These offerings give commuters more choices, but may also undermine the public services available. They raise fundamental questions about the future of how people will get around cities.
I used to think these services were just for the rich—a friend of mine who lived in New York insisted on taking an Uber Pool to work every day because he said it was a much better experience than public transit. But as the options increase, they carry an expanding array of people. This morning, for instance, I walked one block from my house to take a private van service called Chariot to my office in San Francisco. Before Chariot, this commute took at least 40 minutes and consisted of riding a bus to the subway to another bus. Chariot—a shared van service run by a private company—brought me directly from my house to my office in just over 20 minutes. And it cost roughly the same price as the lengthier public transit option.
Director James Comey tells lawmakers that the bureau has uncovered more emails and is reviewing them “to determine if they contain classified information.”
Hillary Clinton’s email saga isn’t over.
The FBI is reviewing a new set of emails “to determine whether they contain classified information,” the bureau’s director, James Comey, told congressional committee chairmen in a letter on Friday. Comey wrote that the FBI discovered the messages in an unrelated case and “cannot assess whether or not this material may be significant.”
“In connection with an unrelated case, the FBI has learned of the existence or emails that appear to be pertinent to the investigation,” Comey wrote in the three-paragraph letter. “I am writing to inform you that the investigative team briefed me on this yesterday, and I agreed that the FBI should take appropriate investigative steps designed to allow investigators to review these emails to determine whether they contain classified information, as well as to assess their importance to our investigation.”
We built a fake web toaster, and it was compromised in an hour.
Last week, a massive chain of hacked computers simultaneously dropped what they were doing and blasted terabytes of junk data to a set of key servers, temporarily shutting down access to popular sites in the eastern U.S. and beyond. Unlike previous attacks, many of these compromised computers weren’t sitting on someone’s desk, or tucked away in a laptop case—they were instead the cheap processors soldered into web-connected devices, from security cameras to video recorders. A DVR could have helped bring down Twitter.
Great, I thought as I read the coverage last week. My DVR helped bring down Twitter. (Probably not, at least this time—the targeted products were older than what you’d find in most American homes, and less protected.) But the internet is huge! There are around a couple billion public IPv4 addresses out there; any one of those might have a server, a desktop computer, or a toaster plugged in at the other end. Even if the manufacturer of my gadget gave it a dumb and easily guessed password, wouldn’t it be safe in this sea of anonymity? How would the hackers find me?
Donald Trump was of course “joking” when he said yesterday in Toledo, Ohio, that “we should just cancel the election and just give it to Trump, right? What are we even having it for?”
In the clip below, you can see what we’ve come to recognize as a classic Trump-rally two-track message. It’s a mixture of claims that would be outrageous if taken seriously, with a half-joking affect that lets Trump suggest that he’s not being serious at all. As a result, he can have it both ways. People who want to, can take this as something Trump is really supporting. (This is a variation of, “A lot of people are saying....”) But if anyone gets huffy and calls Trump on it, he can say, “What kind of dummy are you? Of course that was a joke!”
The FBI has announced that it is reviewing new emails related to Hillary Clinton’s use of a private email system, after the messages turned up in an unrelated inquiry.
Here’s that October surprise. The FBI will investigate newly revealed emails from Hillary Clinton related to her use of a private email server and address while secretary of state, Director James Comey informed the chairs of relevant congressional committees on Friday.
In a letter, Comey wrote, “In connection with an unrelated case, the FBI has learned of the existence of emails that appear to be pertinent to the case.” He wrote that he had learned of the emails on Thursday and felt that the FBI should look into the new emails.
But Comey added that the FBI “cannot yet assess whether or not this material may be significant, and I cannot predict how long it will take for us to complete this additional work.”
Hillary Clinton and Donald Trump prepare for the final sprint to Election Day.
It’s Friday, October 28—the election is now less than two weeks away. Hillary Clinton holds a lead against Donald Trump, according to RealClearPolitics’ polling average. We’ll bring you the latest updates from the trail as events unfold. Also see our continuing coverage:
What is lost when disadvantaged students are forced to commodify their backgrounds for the sake of college admissions?
Shortly after moving to New York two years ago, I began volunteering as a writing mentor at Minds Matter, a large, multi-city nonprofit that helps prepare underserved high-school students for college. Just a few months earlier, I’d graduated from a liberal-arts college I’d attended after participating in a similar program, and I felt both obliged to pay my good fortune forward and uniquely qualified to do so. If my experience had taught me anything, it was the power of a compelling personal narrative.
By the time I’d decided, mid-way through high school, that I wanted to attend college—and not just any college, but a competitive one, filled with Gothic Revival buildings and storied histories—I had to contend with a spotty transcript, virtually no extracurriculars, and an SAT math score inferior to that of many middle schoolers. Then I heard about QuestBridge, a nonprofit that connects low-income youth with top schools.
Doug Band helped everyone get rich in the post-presidential empire, but his re-emergence in the WikiLeaks hack is another headache for Hillary.
Who is Doug Band, and what did he do for Bill Clinton?
A little bit of everything, it turns out.
He helped launch the Clinton Foundation, came up with the idea for the Clinton Global Initiative, brokered deals for paid speeches that enriched Clinton, and then started a private consulting firm called Teneo that made the Foundation, Bill Clinton, and Band himself even wealthier.
All of that became clear in the latest batch of hacked emails released by WikiLeaks, which include messages from Band and a 12-page memo that he wrote both explaining and defending his and his company’s work on Clinton’s behalf. For Hillary Clinton’s campaign, the publication of the Band memo is yet another WikiLeaks-induced headache, as it provides even more detail into the unsavory-if-not-illegal intersection of interests at the heart of her family’s philanthropic work.
I generally enjoy milk chocolate, for basic reasons of flavor and texture. For roughly the same reasons, I generally do not enjoy dark chocolate. *
Those are just my boring preferences, but preferences, really, won’t do: This is an age in which even the simplest element of taste will become a matter of partisanship and identity and social-Darwinian hierarchy; in which all things must be argued and then ranked; in which even the word “basic” has come to suggest searing moral judgment. So IPAs are not just extra-hoppy beers, but also declarations of masculinity and “palatal machismo.” The colors you see in the dress are not the result of light playing upon the human eye, but rather of deep epistemological divides among the world’s many eye-owners. Cake versus pie, boxers versus briefs, Democrat versus Republican, pea guac versus actual guac, are hot dogs sandwiches … It is the best of times, it is the RAGING DUMPSTER FIRE of times.
The FBI is once again looking at Hillary Clinton’s emails, Dakota Access Pipeline protests, acquittals in the Oregon standoff, and more from across the United States and around the world.
—The FBI director says the bureau is looking at additional Hillary Clinton emails to “determine whether they contain classified information.” The emails came to light, he said in a letter to congressional lawmakers, in connection with an unrelated case. More here
—Authorities arrested 141 people protesting the Dakota Access Pipeline in a stand-off at the controversial project’s construction site. More here
—Ammon Bundy and Ryan Bundy remain in jail Friday, a day after they and five other defendants were found not guilty of federal conspiracy and weapons charges stemming from their armed takeover of a federally owned wildlife sanctuary in Oregon earlier this year. More here
—We’re live-blogging the news stories of the day below. All updates are in Eastern Daylight Time (GMT -4).