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The region will be known for its success in developing innovative products, businesses and industries. | |
From 1998 to 1999, venture capital investments in Chicago area firms tripled from $387 million to $1.19 billion. Internet-related companies captured the largest share of 1999 venture capital investment, with 38% of the total, followed by communications at 16% and medical/health firms at 9%. Companies that have passed the screen of venture capitalists are innovative, entrepreneurial and have growth potential, which is why venture capital investment is a good indicator of economic vitality.
Though total investment was up substantially, the region’s share of national venture capital has remained steady for the last six years at about 2.1%, down from 4.8% in 1990.
Fast-growing, publicly traded companies based in the Chicago region that had at least $1 million in annual sales, and growth rates greater than 20%/year for the last four years, grew from 25 firms in 1991 to 64 in 1999, an increase of 156%. However, our region’s share of these fast growth “gazelle” companies is remaining constant at just under 3% of the national total. We’re neither losing ground nor gaining ground in the race to nurture these important, innovative and entrepreneurial firms. Diversified financial services represented the largest share of these “gazelle” companies. High numbers of fast-growth businesses reflect healthy levels of innovation and entrepreneurship.
Despite the importance of technology and innovation in the modern economy, fewer than 45% of the region’s residents felt it was a top priority or very important for the Chicago region to be known for its cutting edge and innovative companies.
