like startup accelerator Gener-
8tor. Funding has been tough
to come by here, but companies like Northwestern Mutual,
which has its own venture fund,
are helping turn it around. The
latest challenge? Stemming
the Millennial brain drain. Early
this year, Wisconsin blitzed Chicago with a $1 million “
Wisconsin. It’s More You” ad campaign
aimed at poaching young professionals. —K.R.
San Antonio-New Braunfels, TX
Affordable housing, business
incentives, and jobs—especially
high-paying ones in finance,
cybersecurity, tech, and
defense—are drawing workers
and entrepreneurs alike. Meanwhile, two local billionaires are
busy boosting development.
Graham Weston, co-founder of
Rackspace, donated $15 million
to expand the University of
Texas at San Antonio and is
nurturing a tech district in town.
Kit Goldsbury, former owner of
Pace Foods, is behind the massive Pearl District redevelopment. And the startup scene
is as diverse as the city’s residents: Headline-grabbing
companies include Mailgun
Technologies (an automated
email platform for developers
spun off of Rackspace), Merge
Labs (a VR-product creator),
and WellAware (an oil and gas
data platform). —K.R.
Oklahoma City, OK
After the oil boom went bust
in the 1980s, Oklahoma City’s
locals wrote their own comeback story, approving multiple
temporary sales-tax hikes to
buck up the faltering economy
and near-deserted downtown.
Major capital improvement
plans followed. Decades later,
they’ve revitalized the city,
which includes the new Innovation District, a neighborhood
surrounding the Oklahoma
Health Center that’s a hub for
research companies. Meanwhile, nonprofit i2E has been
funding and mentoring
hundreds of local and state
science-oriented startups for
the past 20 years. One recent
success story is Tetherex
Pharmaceuticals, which raised
$50 million earlier this year.
Sugar Land, TX
Nearly one in four residents
here is foreign born, and the
median age is almost four
years younger than the country
median. What’s the draw? Low
cost of living and lots of jobs.
Unauthorized immigrants or
noncitizens with legal status fill
nearly half of the city’s construction jobs—an industry
that’s grown 14 percent since
Hurricane Harvey. The service
industry is also a standout, but
the city’s once-lagging startup
scene is catching up. Houston
recently almost matched Austin in venture capital funding.
Health care and energy start-ups are strong, with money
pouring into companies like
Procyrion (creator of a micro-pump to manage chronic heart
failure), OncoResponse (an
immuno-oncology firm), and
Enchanted Rock (a utility). —K.R.
St. Louis, MO-IL See page 53.
See page 66.
In a state where the main
private-sector industry for 400
years has been agriculture, it’s
no surprise Richmond has its
share of food-centric startups.
Standouts include insulated-packaging manufacturer
TemperPack, which scored
$4.5 million from Closed Loop
Fund in July, and plant-protein
product specialist Nutriati.
Beyond that, the city’s entrepreneurs resist classification.
Lighthouse Labs, led by Todd
Nuckols, has nurtured companies that offer Lyft-like service
for non-emergency medical
transport (Round Trip) and provide support to parents of autistic children (AnswersNow).
Controversial pharma startup
Kaléo is a local hero: This spring
it began offering an opioid-overdose antidote for free to
eligible patients in some states.
Countering a shortage of early-stage capital are $4 million
fund Trolley Ventures, founded
in September, and VC firm
NRV, which last year launched a
$33 million early-stage growth
Just like its diverse neighborhoods,
Chicago’s business culture has many
faces: No single sector owns more
than 14 percent of the economy. Still,
with a 33 percent increase in tech
employment from 2011 to 2016, it’s
clear where much of the city’s entrepreneurial energy is being generated.
Chicago is home to tech incubator
1871; in April, Betsy Ziegler became its
first female CEO, replacing the ubiquitous Howard Tullman (an Inc.com
columnist). Logistics software rivals
Project44 and FourKites have had
big rounds—the former a $45 million
Series C in October, the latter a
$35 million Series B last February. In
2017, when protein-bar maker RXBar
was acquired by Kellogg for $600
million, it further validated the city’s
bustling food startup scene. Up-and-comers now include Simple Mills and
Tiesta Tea. But no matter how the
startup world hums, people still talk
about Groupon—or at least about Eric
Lefkofsky and Brad Keywell, the two
co-founders who remain in town.
Their latest projects, Tempus and
Uptake, are each said to be valued
at $2 billion or more. —E.L.
Elevating the Midwest
Chicago is buzzing with startup activity, from tech
incubator 1871 to RXBar, which was purchased by Kellogg
for $600 million last year.