WBEZ | entrepreneurship http://www.wbez.org/tags/entrepreneurship Latest from WBEZ Chicago Public Radio en Risk-taker embraces failure to find success http://www.wbez.org/news/risk-taker-embraces-failure-find-success-108912 <p><p>Terry Howerton is giving me a tour of his latest business venture, which he recently moved to the Civic Opera Building downtown. TechNexus is a tech collaborative that helps launch startups.</p><p>&ldquo;What we&rsquo;re walking through right now, this space will be what we call grow suites. A grow suite is designed to have room for a two person or a four person company,&rdquo; he said.</p><p>The office walls can literally move to adjust to a start-up&#39;s needs as it grows.</p><p>Outside on the 15th floor, contractors built a rooftop deck with a bird&rsquo;s eye view of the Chicago River.</p><p>&ldquo;There&rsquo;s a barbecue and a bar area. And the idea is that most of the people who build companies at TechNexus, these are startups. These are entrepreneurs,&rdquo; he said. &ldquo;We&rsquo;re here 12, 15, 18 hours a day, and in some cases 24 hours a day and sleeping on the floor of the office,&rdquo; he said.</p><p><img alt="" class="image-original_image" src="http://www.wbez.org/system/files/styles/original_image/llo/insert-images/Failure%201.jpg" style="height: 263px; width: 350px; float: left;" title="Terry Howerton stands outside on the rooftop deck of TechNexus. He’s building out his tech incubator. (WBEZ/Susie An)" />Deciding where the bar should go on a new company&rsquo;s rooftop deck isn&rsquo;t a decision most would&rsquo;ve thought Howerton would be making at this point in his career. A few years ago, another high profile business of his took a nose dive.</p><p>But in Howerton&rsquo;s words, starting new businesses is simply part of his DNA -- even when they sometimes fail. He&rsquo;s always considered himself an entrepreneur, as far back as the second grade.</p><p>&ldquo;I realized the pencil machine outside of the principal&rsquo;s office that sold pencils two for a quarter, you could buy all the pencils out of the machine. It took the principal two weeks to restock the machine,&rdquo; he said. &ldquo;So if you cornered the market on pencils, you could sell them for a quarter apiece.&rdquo;</p><p>Howerton said he must&rsquo;ve started 20 to 30 companies over his lifetime. He dropped out of college his freshman year because he wanted to work on a business idea, instead of sitting bored in class.</p><p>In 2001, he moved to Chicago to launch a tech firm called Fast Root. It was a company that delivered software on the Internet. Things were going well for the business. So Howerton started launching other projects, like a tech incubator that would later become TechNexus.</p><p>But after awhile he found himself losing zeal for FastRoot. And maybe that was the tip of the iceberg.</p><p>&ldquo;We were very ambitious at FastRoot, and had planned on building several new data centers, had projects underway, very expensive projects we were spending money on,&rdquo; he recalled. &ldquo;When the market shifted in 2008, because I wasn&rsquo;t really focused completely on the business, I think we weren&rsquo;t agile enough to respond.&rdquo;</p><p>One of the other ventures he was juggling back then was a charter school that he helped build. It taught inner city kids about entrepreneurship and technology. Howerton said as FastRoot starting tanking, he found himself telling the students that failure was part of entrepreneurship. But here he was unable to accept it.</p><p>&ldquo;I think there&rsquo;s a thin line between entrepreneurs who think people telling them something is impossible is completely plausible,&rdquo; he said. &ldquo;The idea that I&rsquo;m going to fight that battle until I win that battle, which is something that&rsquo;s just ingrained in an entrepreneur. And the idea of being able to accept failure fast enough.&rdquo;</p><p>For something that could&rsquo;ve been over in 60 days, the FastRoot failure dragged out painfully for a year and a half. Howerton said he began doubting himself and had no energy to create new things.</p><p>&ldquo;I think a part of that time, as the Titanic was sinking, as the business was failing, and a part of that time was licking my wounds after that failure. And that&rsquo;s what failure does to an entrepreneur. It really distracts them from other opportunities for success,&rdquo; he said.</p><p>And then Howerton faced a kind of crossroads. He was offered a job at another company, a good position with a nice salary. He turned it down.</p><p>&ldquo;What finally helped me break out of the cycle was to realize that that wasn&rsquo;t me. It had never been me in 25 years of being an entrepreneur, and I didn&rsquo;t want it to be me for the next 25 years,&rdquo; he said.</p><p>Howerton doesn&#39;t remember this period fondly.</p><p>&ldquo;It was pretty visible, and lots of gossips and gadflies and bloggers like to write about it and poke fun about it, but it&rsquo;s made me stronger,&rdquo; he said.</p><p>Strong enough even to face his old failures. After he finishes the TechNexus build out, Howerton said he plans to give FastRoot another try.</p><p><em>&ldquo;At What Cost?&rdquo; is made possible in part by the John A. Wing Society, an initiative of the Illinois Humanities Council to improve dialogue about business and the common good.</em></p></p> Mon, 14 Oct 2013 10:31:00 -0500 http://www.wbez.org/news/risk-taker-embraces-failure-find-success-108912 Chicago retailer credits ignorance of risk for its success http://www.wbez.org/news/chicago-retailer-credits-ignorance-risk-its-success-108911 <p><p>Sometimes risk can be masked by a lack of experience and knowledge. But that doesn&#39;t mean someone can&#39;t find success. More than 10 years ago, Jon Cotay took a chance on a venture he knew nothing about. Today, it&rsquo;s paying off.</p><p>Cotay&rsquo;s a man with a lot of energy.&nbsp; If he&rsquo;s not managing 400 vendor accounts or keeping tabs on 270 employees, he&rsquo;s likely at a fashion event.</p><p>&ldquo;The funny part is all three of us are really not the most fashionable people out there. If we had to look back, we were just like what the heck were we thinking?&rdquo; he said.</p><p>Eleven years ago, he and two college friends founded Akira, a fashion retail company. Cotay said fashion still doesn&rsquo;t come naturally to him. His assistant had to tell him not to wear shorts and flip-flops to our interview. Instead, he wore a sharp blazer and jeans.</p><p><img alt="" class="image-original_image" src="http://www.wbez.org/system/files/styles/original_image/llo/insert-images/success%203.jpg" style="float: left; height: 234px; width: 350px;" title="Akira’s Block 37 store. The company has opened 17 stores since 2002. (Photo courtesy of Akira)" />In just over a decade, he and his two partners Erikka Wang and Eric Hsueh built Akira into 17 stores across the Chicago region with an online shop that sells internationally. And yet when they all attended the University of Illinois in Urbana Champaign not one of them studied fashion or business. Hsueh and Wang studied Management Information Systems. Cotay majored in nursing.</p><p>&ldquo;We actually bonded around food. All of us are Asians. Different people worked in different restaurants. The three of us would get together and barter food,&rdquo; Cotay said.</p><p>After graduation, all three worked in fields related to their majors. Cotay had multiple nursing jobs, including a full time shift at a hospital just to keep busy. Then, one day, Erikka Wang wasn&rsquo;t feeling satisfied with her job. She wanted something new. So she presented Eric Hsueh and Cotay with a crazy idea, a career in fashion retail.</p><p>&ldquo;We started laughing. We&rsquo;re like,&rsquo;really, the three of us would open something in retail.&rsquo; And we didn&rsquo;t even know what the scope of retail was. We didn&rsquo;t know about brands. We didn&rsquo;t know anything about distribution. We didn&rsquo;t know anything about how the retail market worked,&rdquo; he said. &ldquo;We just thought it was kind of like a cool idea to get started.&rdquo;</p><p>Cotay was 28-years-old at the time. After a few years of nursing experience, his parents expected him to go to med school, not run a business. But he decided to take a chance. He and his partners opened their first Akira store in Bucktown in 2002.</p><p>&ldquo;For the first three years, I didn&rsquo;t actually tell my parents I owned the business. My parents are conservative and everything like that, so I didn&rsquo;t want to put them on a lot of stress,&rdquo; he said.</p><p>Cotay never really officially told his parents he had started a business.</p><p>&ldquo;Over time, they just realized, &lsquo;what is Jon doing at this store. Why are you always there?&rsquo; Every time they asked me why are you always there a lot. I say, &lsquo;oh, I work there part time,&rsquo;&rdquo; he said.</p><p>Actually, he and his partners worked overtime. They noticed most stores in the area sold luxury goods and were only open from 11 to 5. They tried something different. They brought in more affordable options and kept the doors open until 9, sometimes later if they were just hanging out on a Friday night.</p><p><img alt="" class="image-original_image" src="http://www.wbez.org/system/files/styles/original_image/llo/insert-images/success%202.jpg" style="float: right; height: 233px; width: 350px;" title="From left to right, Eric Hsueh, Erikka Wang and Jon Cotay. The three college friends founded Akira 11 years ago. They were successful despite knowing little about fashion or business. (Photo courtesy of Akira)" />&ldquo;We didn&rsquo;t even think about the risk factor. We just had the mentality like &lsquo;well, we have to pay our bills.&rsquo; So we have to make sure whatever we can do, we just do it,&rdquo; he said.</p><p>Cotay said it was an immigrant work ethic that drove them. Before he was born, Cotay&rsquo;s grandparents emigrated from China to the Philippines. He watched them work hard to keep their own small business going. That stuck with him when he came to the U.S.</p><p>But his parents still wonder about his career in medicine.</p><p>&ldquo;I think even 7 years into the business they asked me if I would still consider going to med school. And I&rsquo;m like I don&rsquo;t think that&rsquo;s going to happen now. This is it. This is my baby right now,&rdquo; he said.</p><p>Cotay&rsquo;s parents might&rsquo;ve worried if they knew their son put his savings into opening a clothing store without having a business plan. This is the first year the company brought in business consultants. And Cotay said they all question how Akira got where it is today without a set strategy.</p><p>&ldquo;We were all in some way ignorant about it. We kind of like had more confidence in ourselves to get it done. But if we knew now how challenging it was, we would probably talk ourselves out of it,&rdquo; he said.</p><p>It all seems pretty risky in hindsight. But Cotay and his partners may have been too busy building a successful business to notice.</p><p><em>&ldquo;At What Cost?&rdquo; is made possible in part by the John A. Wing Society, an initiative of the Illinois Humanities Council to improve dialogue about business and the common good.</em></p></p> Mon, 14 Oct 2013 10:29:00 -0500 http://www.wbez.org/news/chicago-retailer-credits-ignorance-risk-its-success-108911 Millennials, risk and the economy http://www.wbez.org/blogs/leah-pickett/2013-10/millennials-risk-and-economy-108886 <img typeof="foaf:Image" src="http://llnw.wbez.org/main-images/niala.PNG" alt="" /><p><p><em>Above is a Google hangout between fellow WBEZ blogger Britt Julious and Afternoon Shift host Niala Boodhoo, discussing how millenials are taking risks in today&#39;s economy.</em></p><p>Oh, those millenials. Generation Y, made up of people born between the late &#39;70s and early &#39;90s, is often called the&nbsp;<a href="http://www.nytimes.com/2011/11/13/opinion/sunday/the-entrepreneurial-generation.html?pagewanted=all&amp;_r=1&amp;" target="_blank">&quot;entrepreneur generation,&quot;</a>&nbsp;due in large part to the plucky startup models, risk-taking mentalities and personal branding strategies that have come to define success at work in the new millennium. Rapidly transitioning from one career to another also has emerged as a frequent practice for Gen Y, and <a href="http://finance.yahoo.com/blogs/daily-ticker/born-digital-millennials-change-workforce-much-more-115241544.html" target="_blank">&quot;sidepreneurism,&quot;</a> the increasingly popular trend of employees creating and running their own businesses while still engaged in a full-time job, is perhaps even more common.&nbsp;</p><div class="image-insert-image ">However, millennials of the Internet Age also have been dismissed by think piece writers, political pundits, and baby boomers ad nauseam. They have been labeled lazy, bratty, pretentious, entitled and self-absorbed. Framed in a stereotype, the millennial&#39;s fingers are perpetually glued to an electronic device, watching life go by through the glow of a smartphone screen.&nbsp;</div><div class="image-insert-image ">&nbsp;</div><p>I am 24, and clearly a millennial, but not a single one of the condescending &quot;kids these days&quot; stereotypes applies to me. I was raised to work hard, take responsibility for my actions, embrace change, and never burn bridges. I spend more time reading books then scrolling through filters on Instagram. I also have learned that failure&mdash;big, crushing, spectacular failure&mdash; is often a necessary pathway to success.&nbsp;</p><p>So, which scenario carries more risk for millenials in today&#39;s economy: starting a business from scratch or climbing the corporate ladder? Personally, I would relish the opportunity to work my way up at an organization that fulfills my needs as a young professional&mdash; especially since post-grad <a href="http://www.thefiscaltimes.com/Articles/2011/01/02/Permalancing-The-New-Disposable-Workforce" target="_blank">permalancing</a>, while popular among the twenty-something set,&nbsp;is not the most financially stable of pursuits. Health benefits are frustratingly difficult to come by, and nearly impossible to obtain as a freelancer. Any semblance of job security? Even less so.</p><p>Still, I find myself drawn to the romance and excitement of innovation. I am propelled by Chicago&#39;s recent crowning by Forbes as the new <a href="http://www.forbes.com/sites/johnhall/2013/08/30/why-chicago-is-a-new-hot-spot-for-entrepreneurs/" target="_blank">&quot;hot spot for entrepreneurs</a>,&quot; and inspired by the dream teams who came before us. I think of&nbsp;Steve Jobs and Steve Wozniak building the first Apple computers in Jobs&#39; Los Altos garage, ushering in a new wave of&nbsp;<a href="http://www.businessweek.com/innovate/content/jun2010/id20100610_525759.htm" target="_blank">startup culture</a>&nbsp;and a new generation of people&nbsp;working to&nbsp;elicit powerful, meaningful, and life-altering change from their own backyards, and on their own terms.</p><p>Perhaps millennials need to learn how to fall down in order to get back up again: to create, innovate, and <em>try </em>with boundless enthusiasm. After all, isn&#39;t putting ourselves out there&mdash;at least being able to say that we tried, that we didn&#39;t settle&mdash;better than remaining frozen in stifling, unfulfilling work environments for the rest of our lives, wondering, &quot;What if?&quot;</p><p><em>Leah Pickett writes about popular culture for WBEZ. You can find her on&nbsp;<a href="https://www.facebook.com/leahkristinepickett" target="_blank">Facebook</a>,&nbsp;<a href="https://twitter.com/leahkpickett" target="_blank">Twitter</a>&nbsp;and<a href="http://hermionehall.tumblr.com/" target="_blank">&nbsp;Tumblr</a>.</em></p></p> Thu, 10 Oct 2013 13:00:00 -0500 http://www.wbez.org/blogs/leah-pickett/2013-10/millennials-risk-and-economy-108886 Listeners share their ideas for a better Chicago http://www.wbez.org/episode-segments/2011-10-12/listeners-share-their-ideas-better-chicago-93079 <img typeof="foaf:Image" src="http://llnw.wbez.org/segment/photo/2011-October/2011-10-12/idea.jpg" alt="" /><p><p>World leaders, captains of industry and innovators of all stripes gathered in Chicago throughout the week for the first-ever <a href="http://www.chicagoideas.com/" target="_blank">Chicago Ideas Week</a>."The talks and tours—or "labs"—were open to the public for $15. But for those who missed the opportunity to hear ideas from President Clinton or take a tour of Millennium Park with former Mayor Daley— all hope was not lost. <em>Eight Forty-Eight</em> asked listeners to share their ideas for how to make Chicago a better city. Expert Robert Wolcott, executive director of the <a href="http://www.kinglobal.org/" target="_blank">Kellogg Innovation Network</a>, was in studio to help develop ideas. Wolcott is also a senior lecturer of entrepreneurship and innovation at the <a href="http://www.kellogg.northwestern.edu/" target="_blank">Kellogg School of Management</a> at Northwestern University.</p><p>Full disclosure—Professor Wolcott’s firm, <a href="http://clareopartners.com/" target="_blank">Clareo Partners</a>, is one of the many Chicago Ideas Week partners and WBEZ is a co-Media partner of the weeklong series.<br> &nbsp;</p></p> Wed, 12 Oct 2011 14:27:00 -0500 http://www.wbez.org/episode-segments/2011-10-12/listeners-share-their-ideas-better-chicago-93079 Immigrant entrepreneurs: New Chicago office should cut red tape http://www.wbez.org/story/immigrant-entrepreneurs-new-chicago-office-should-cut-red-tape-90722 <img typeof="foaf:Image" src="http://llnw.wbez.org/story/photo/2011-August/2011-08-17/forweb.JPG" alt="" /><p><p>Chicago has a reputation of being a tough place for small business owners.&nbsp;Everything from obtaining a business license to hanging an awning requires time and a tolerance for red tape.&nbsp;Well, navigating these difficulties can be even more trying if you’re new to the country.&nbsp;Chicago Mayor Rahm Emanuel has promised to fix that by creating an “Office of New Americans” to identify and clear barriers to immigrant entrepreneurs.</p><p>Two things. The Office of New Americans, or “ONA,” is still just a concept. There’s no director, there’s no staff, there’s no budget yet. And second, it’s not just about businesses.</p><p>It’s supposed to help immigrants adjust to all aspects of Chicago life. Whether that be using the library, or navigating the city’s school system. But the business component will be a big part of it.</p><p>Matt Fischler is a Policy Associate in the mayor’s office.</p><p>FISCHLER: Actually, immigrants are 50 percent more likely to start new business in the city of Chicago than current Chicago residents.</p><p>Fischler’s helping create the office. He says other cities have them, and he’s looked to them for guidance: Boston, Los Angeles, Houston and especially New York City.</p><p>You can tell how important immigrant businesses are in Chicago just by visiting the neighborhoods. Many are defined by their unique ethnic flavor.</p><p>Emanuel says encouraging mom and pop shops is just as important as wooing the General Electrics and Boeings.Small businesses help drive job growth in the City of Chicago.</p><p>FISCHLER: if you’re an immigrant come to our shores, you want to start new business, that you either have the educational opportunities available, the mentoring available, and the easiest process available to get the licenses you need, the permitting you need to start your business.</p><p>Here’s where those entrepreneurs go when they want those licenses. Chicago’s office of Business Affairs and Consumer Protection. It’s lunchtime on Monday, and it’s busy. Three-quarters of the seats in the waiting area are taken. People are watching local news on a television screen as they wait to be called up.</p><p>Efrat Stein is the office’s spokesman.</p><p>STEIN: If there are individuals that have special needs with language, we have 6 business consultants that speak Spanish, we have one business consultant that speaks French which particularly is helpful to Haitian and African business communities, we have one employee that speaks Mandarin, we have an emploiyee that speaks Cantonese, and we also have an employee that speaks Polish.</p><p>And if someone comes in speaking Gujarat? Hindi? Vietnamese?</p><p>STEIN: Typically here we’re seeing somebody who may have a language barrier is preparing themselves by bringing an interpreter with them.</p><p>Stein says sometimes on-site translation is a challenge. But it’s not the only challenge.</p><p>NGUYEN: Most of the people, the problem is they don’t know how to do the paperwork.</p><p>This is Tam Van Nguyen. He’s helped hundreds of Vietnamese businesses get started in Chicago.&nbsp;This used to be his paid job. It isn’t anymore, but people in the community still go to him for help.</p><p>Nguyen says the license forms are pretty simple. The problem is that they’re in English. In fact, the only foreign language that the city offers the forms in, is Spanish.&nbsp;So Nguyen helps Vietnamese entrepreneurs fill the forms out in English, and then he has to coach them on what to do when they bring them to the city.</p><p>NGUYEN: “be careful when they ask you this question, this question, this question, you know. And if when they ask the question you should answer something like that.</p><p>Nguyen actually used to be able to go to the BACP office himself and file the paperwork on behalf of those businesses, but in 2008 things got complicated. The city started requiring people like Nguyen to have a something called an expediters license.</p><p>Since Nguyen does this on his own time, and doesn’t get paid, he doesn’t have the expediters license. But he’d like to see the city get rid of that requirement. Barring that, he'd like to at least get the paperwork translated into Vietnamese, and have Vietnamese-speakers in the BACP office.&nbsp;If those are things that the ONA will help to start, Nguyen thinks it’s a grand idea.</p><p>NGUYEN: If the City of Chicago to do like that, maybe it (will) make many different ethnic groups, many different immigrant groups feel comfortable and feel happy to do the business with the City of Chicago. That’s my opinion like that.</p><p>Nguyen says for immigrants, this whole process can be confusing and scary, and more than anything, it can just drag out.&nbsp;The city has promised to hire a director for the Office of New Americans at the end of this month, and have the office launch this fall.</p><p>&nbsp;</p></p> Wed, 24 Aug 2011 10:10:00 -0500 http://www.wbez.org/story/immigrant-entrepreneurs-new-chicago-office-should-cut-red-tape-90722 Venture: Is starting a business in a downturn crazy - or savvy? http://www.wbez.org/content/venture-starting-business-downturn-crazy-or-savvy <img typeof="foaf:Image" src="http://llnw.wbez.org/story/photo/2011-June/2011-06-30/IMAG0687.jpg" alt="" /><p><p style="text-align: center;"><img alt="" class="caption" src="http://llnw.wbez.org/story/insert-image/2011-July/2011-07-11/Ashley housing_WBEZ_Ashley Gross.jpg" style="width: 300px; height: 502px; margin: 5px;" title=""></p><p>Against the backdrop of a poor job market, more people are making their own jobs, starting up businesses, even in industries that might surprise you. Brian Brunhofer is showing off his company's first home under construction.&nbsp; Wait a minute, did he say home? Under construction?</p><p>BRUNHOFER: We started this house about 30 days ago. We’ve done first and second-floor framing.</p><p>The homebuilding industry has fallen off a cliff, so who thinks, 'Yeah, now’s the time to start a homebuilding company? Now’s the time to put up more houses?'</p><p>Brian Brunhofer and his wife Karen do. They started their own company, Meritus Homes, a year ago.</p><p>That’s after their executive-level jobs with one of the nation’s biggest homebuilders, Pulte, were eliminated.</p><p>Karen says land prices had dropped so low they jumped on the chance to go into business for themselves.</p><p>KAREN BRUNHOFER : We saw a unique opportunity to go in and start buying really good locations, where there’s great accessibility to transportation and employment, the school districts were good and there wasn’t a lot of supply in the area. And we were buying them at the distressed current pricing versus at the boom time.</p><p>So actually when you think about it, from that perspective, it makes sense.&nbsp; They can buy low from other builders and banks who want to bail on their projects.</p><p>That’s what happened here in this subdivision in the northwest suburb of Inverness.</p><p>KB Home pulled out and the Brunhofers came in, buying 27 empty lots, with another real estate partner.</p><p>Okay, the supply side adds up, but what about the demand side?</p><p>The number of new homes selling these days is just a quarter of what it was in 2005. New home sales have risen a bit this year from last year but are still lower than half a century ago. Brian says they weren’t pollyannas about a market rebound.</p><p>BRIAN BRUNHOFER: We were very realistic in putting together a business plan that said we can sell one a month at this price and that has been something that has met our expectations.</p><p>STEVE ROGERS: If you can find the market that will buy your homes, why not pursue that right now?&nbsp;</p><p>I went to see Steve Rogers to get his perspective. He teaches entrepreneurship at the Kellogg School of Management at Northwestern. I wanted to know if a downturn, like the housing morass we’re in right now is a good or a bad time to start a company.</p><p>ROGERS: History shows that during tough times, entrepreneurial ventures actually increase. And we see, for example, historically that companies in the Fortune 500 like Eli Lilly, RadioShack, Burger King, Microsoft were founded during tough economic times. So some advantages to starting a company during a downturn - one, you have a bigger pool of employees to pick from. During a downturn, as we all know, unemployment is high and therefore you can hire the best of the best at good prices. So that's one of the advantages. Another advantage is that we see more capital being available for entrepreneurs, especially in the private equity category and the equity category. You know, we had an issue with debt capital being somewhat limited to us, but more equity capital is available because of how the public markets are responding to entrepreneurial ventures like Groupon, the fastest-growing company that in fact was started during a downturn.</p><p>GROSS: What about people's ability to spend? A lot of people don't have work, they don't have a ton of money.</p><p>ROGERS: Entrepreneurial ventures will be successful because they're different, and if you start something different and it meets a market need, even during a downturn when people don't have loads of cash, you still can prosper. Yes, you may not be able to get people spending lavishly, but even during tough times, we look at companies like Whole Foods - and I call it 'Whole Paycheck' - very expensive products that they sell, and right now they're booming. So just because there's a downturn does not mean that people will not spend.</p><p>GROSS: I'm thinking of people who might be listening to this who are saying:&nbsp; I'm just scraping by, I can't even contemplate starting a company now. What about those people?</p><p>ROGERS: The reality is these are tough times, these are scary times, my resources are limited, but some people may be faced with no other option and that is - when you don't have the option to take a job, your focus has to be on making a job for yourself and possibly even others.</p><p>Karen and Brian Brunhofer made their own jobs and now have four employees. Karen says quite a few people have told them they’re crazy to start up now.</p><p>KAREN: I think some people think this was not the right time, I think we think the exact opposite.&nbsp;</p><p>They say so far they’re on track with their plan, lining up buyers at a rate of about one a month. And Karen says more people tell them working with your spouse may be even crazier than starting a homebuilding business in the middle of a housing slump.</p><p>I’m Alex Keefe, with our Windy Indicator, where we measure the larger economy by examining one fragment of it. This week…Actually, this one’s intended for mature audiences only, so I’ll give you a second to send the kids out to play.</p><p>So, we adults have all heard the adage “sex sells.” But for the pornography industry right now – it’s more like “sex gets stolen.”</p><p style="text-align: center;"><img alt="" class="caption" src="http://llnw.wbez.org/story/insert-image/2011-July/2011-07-11/adult entertainment_WBEZ_Ashley Gross.jpg" style="width: 500px; height: 375px; margin: 5px;" title="The adult entertainment industry faces many of the same challenges other parts of the entertainment economy. (WBEZ/Ashley Gross)"></p><p>PHELPS: When we’re trying to charge money for a product, if somebody’s giving it away for free – because they stole it – that kills everybody.</p><p>Jesse Phelps, with hotmovies.com, was one of several porn industry pros at the traveling Exxxotica expo that stopped in Rosemont over the weekend.&nbsp;</p><p>And when you got away from the throbbing music, the women dancing in cages, the vendors selling unmentionables, a lot of the talk was about piracy.</p><p>That’s due to the recent proliferation of so-called “tube sites,” websites that rip down copyrighted skin flicks, then post them online free of charge. About the same time tubes were sprouting up, the recession was cutting into porn sales.</p><p>The combination has caused big headaches for porn production houses like Evil Angel, where Justin Rich is a sales manager.</p><p>RICH: Our company has hired an agency, and all they do all day is go online and they send cease and desist letters to the tube sites and make them take everything down.</p><p>Nevertheless, the porn industry’s trade group says, in the last few years, revenue declines of 40 to 50 percent have been commonplace.</p><p>ANGEL: When you steal music, it’s a pain in the ass. When you steal porn, it is so easy.</p><p>Porn starlet Joanna Angel – she goes by her stage name – is taking another tack: make people want to pay.</p><p>ANGEL: It’s like the answer to the problem for not making as much money is to spend three times as much money to hope to not lose what we have.</p><p>While other companies fight piracy, she says hers is investing in high-definition video, social networking, and live chat rooms.</p><p>And she says it’s working.</p><p>ANGEL: I am a business woman. I just like to take my clothes off and, like, have sex with people on camera sometimes. (laughs)</p><p>Next week on Venture:&nbsp; Ah, the adventures of first-time home buying.</p></p> Mon, 11 Jul 2011 05:01:00 -0500 http://www.wbez.org/content/venture-starting-business-downturn-crazy-or-savvy Venture: A business school shark tank for aspiring CEOs http://www.wbez.org/story/venture-business-school-shark-tank-aspiring-ceos-87736 <img typeof="foaf:Image" src="http://llnw.wbez.org/story/photo/2011-June/2011-06-13/Booth School U Chicago_Flickr_Ben Casawood.jpg" alt="" /><p><p>It’s graduation season – and lots of grads are hitting the job market. But some are choosing an opposite direction - they're hatching their own companies – hoping to become the next Mark Zuckerberg. At the University of Chicago Booth School of Business, a course on how to do exactly that is now one of the hottest things on campus.</p><p>Michael Toporek is trying to be kind. He's an investment manager helping judge an early round of the New Venture Challenge. That’s a competition and a class at the Booth School of Business. Teams of students present their ideas to investors, and the winners take home thousands of dollars to help run their companies.</p><p>Toporek is telling a team they're kind of lacking gumption. &nbsp;</p><p>MICHAEL TOPOREK: if you really think that those numbers are true, I would shake your hand, thank you, think you were intelligent and wish you the best of luck.<br> <br> Rafi Aviav is one of the students explaining their idea for investment strategy software. He tries to defend his team's financial projections but then commits a cardinal sin – he admits they lowballed the numbers.<br> <br> AVIAV: We're always encouraged to be ambitious and accurate, I think, but we really were quite conservative.<br> STEVE KAPLAN: You guys have to leave.<br> WAVERLY DEUTSCH: You're not allowed to use that word.<br> &nbsp;<br> It's early April, and the teams are still a bit rough around the edges. And the stakes are high – By the end of May, when the top 10 teams go to the finals, $75,000 in prize money hangs in the balance.<br> <br> Aviav originally came to Booth from Israel to study finance but contracted startup fever.<br> <br> AVIAV: I have a good friend, who's Uzi Shmilovici, who started PipeJump and was in last year's competition and just recruited $1 million from VCs, so to me, Chicago is just an amazing place and a real hotbed for entrepreneurship.<br> <br> Business plan competitions are nothing new.&nbsp; More than 50 universities have them, including top schools like Harvard and Wharton. But for a school like Booth that's been known for its focus on number-crunching and finance, the increasing popularity of entrepreneurship is dramatic.<br> <br> More than 65 companies have emerged from the New Venture Challenge in the past 15 years. They've raised about $150 million in venture capital. A third of that has come in the past year alone.<br> <br> Steve Kaplan is one of the professors who runs the course. He says it's not much like any other class.<br> <br> KAPLAN: I don't really teach anything.<br> <br> Instead he pushes the students to figure stuff out on their own – and not just on paper. The best companies in the class are already up and running, with students juggling tests and customers at the same time. He says the students are the ones in the driver's seat, but:<br> <br> KAPLAN: We give them premium gasoline so they can go faster than they would have gone if they weren't doing the class.<br> <br> That includes recruiting judges from Chicago's top venture capital firms. Lon Chow is a general partner with Apex Venture Partners, which manages a $140 million fund. He says the New Venture Challenge has opened his mind to investing in companies started by students.<br> <br> CHOW: The last thing you want to do is have a bunch of newly minted MBAs learn on your dime about starting businesses, and I think they've done a phenomenal job of just improving, attracting really talented students.<br> <br> And those students are going off and creating real companies.<br> <br> MATT MALONEY: These are all people who are getting restaurant menus and entering them into the web site, and then behind you is some phone sales.<br> <br> Matt Maloney is giving me a tour of his company – you may have heard of it – GrubHub, a web site for ordering takeout. He and co-founder Mike Evans won the New Venture Challenge in 2006. But Maloney says almost no one would have picked them as winners in the beginning.<br> <br> MALONEY: When we went in, we were just two young scrappy entrepreneurs thinking we had the greatest idea ever, so we got up for our first presentation and pretty much said, here it is, isn't it great? And they all kind of resoundingly said, 'What the hell are you talking about?'<br> <br> He says they needed to show how they could make money on each transaction. So they went back to the drawing board, retooled their presentation and won. Now they've raised more than $34 million in venture capital.<br> <br> The GrubHub guys are legends to current Booth students like Nik Abraham.<br> <br> NIK ABRAHAM: Yeah, you kick it off by saying we're Sibylus and then introduce everyone and then Ingram will start.<br> <br> It's a Sunday afternoon, and Abraham and four other students are holed up in a classroom rehearsing.<br> <br> MATT KOPKO: Alright, hey guys, I'm Matt, this is Ingram, this is Julian, Nik and Jason here and we're Sibylus. We're doing essentially digital coursepacks.<br> <br> Their company is called Sibylus – yes, they know it sounds like syphilis and they're trying to come up with another name. But they're more certain of the concept – circumventing the expensive collections of newspaper and journal articles called coursepacks that professors make them buy for almost every class. Their company searches databases and the internet to provide students with links to the articles for much less money. And they're already in business – they sold 200 coursepacks to fellow Booth students this semester. Abraham says the idea for the company arose from a universal gripe.<br> <br> ABRAHAM: Students sign up for classes, they go to the bookstore, they complain about waiting in line and paying all this money, they come back to the Winter Garden and have lunch with their friends and everyone will be complaining about it. So that's when I realized so many people are experiencing this pain, there's definitely something we can do about it.<br> <br> Since they launched in March, Abraham says running the business has eclipsed everything in their lives. His team is part of a trend toward entrepreneurship that accelerated as the economy worsened. According to the Kauffman Foundation, last year the percentage of people who started businesses was at its highest in 15 years.&nbsp; As for the New Venture Challenge, Abraham says they'd love to win, but what they really want is a successful company.<br> <br> ABRAHAM: It would not be a good outcome if we won the NVC and flopped.<br> Turns out, they cross the first hurdle and make it to the finals.<br> <br> There, they face some stiff competition.<br> <br> SWINGBYTE INTRO: Good afternoon, thank you for your time and for the opportunity to introduce you to Swingbyte, a revolutionary golf training device using your smartphone, tablet and computer,<br> LINEJUMP: We are LineJump – a mobile application that allows you to open and close a tab from your smartphone.<br> AGILE DIAGNOSIS: Good afternoon, we are Agile Diagnosis and we develop web and mobile applications that help doctors and nurses more accurately and efficiently diagnose their patients.<br> <br> After each presentation, judges mingle with students, swapping business cards and maybe sowing the seeds for potential investments. I chat with the folks behind Agile Diagnosis, the company that makes medical software. Jon Lee is studying to become a doctor and get his MBA, but he plans to take a leave of absence to work on the company. His parents are not happy.<br> <br> LEE: My mom was just saying I don't understand over and over in Korean.<br> GROSS: What was it in Korean?<br> LEE: Actually that part was in English, but it was in a Korean accent, so it was like Konglish. 'I don't understand. I don't understand.’<br> <br> But maybe this will help her come around – Agile Diagnosis won first place and took home $25,000. It's a little reassurance as her son rolls the dice on his dreams of building a company. And the Sibylus guys? They won second place. They admit first place would have been nice, but they're happy to get this stamp of approval as they set out to woo investors.</p></p> Mon, 13 Jun 2011 05:11:00 -0500 http://www.wbez.org/story/venture-business-school-shark-tank-aspiring-ceos-87736 Governor unveils Illinois Innovation Network http://www.wbez.org/story/governor-unveils-illinois-innovation-network-86842 <img typeof="foaf:Image" src="http://llnw.wbez.org/story/photo/2011-May/2011-05-20/Illinois Innovation Network.jpg" alt="" /><p><p>Illinois Governor Pat Quinn says Illinois could be a leader in creating start-up companies. Quinn announced today the "Illinois Innovation Network" in an invite-only event for leaders of high-tech firms.&nbsp; &nbsp;<br> <br> The network is designed to help entrepreneurs get their businesses off the ground. The idea is to connect them to free or discounted advice in areas like legal matters, real estate and business development.<br> <br> Quinn said, "The best way to fight poverty, the best way to fight crime, the best way to keep families together is a J.O.B. - a job. And that's why we're here today; We want to work together as a team as a family to make things happen in Illinois."<br> <br> Brad Keywell, founder of Chicago-based Groupon, is chairing the network. Keywell says that in the past 25 years, the single largest creator of new jobs in the Midwest has been businesses 5 years old or less.<br> <br> The website for the Illinois Innovation Network is expected to be launched Friday afternoon.</p><p>During the same event, Quinn also announced that Illinois will be the first state to partner with Startup America - a national effort to promote innovation and entrepreneurship.</p></p> Fri, 20 May 2011 20:03:00 -0500 http://www.wbez.org/story/governor-unveils-illinois-innovation-network-86842 Cook County tops the nation in black-owned businesses http://www.wbez.org/story/ashley-gross/cook-county-tops-nation-black-owned-businesses <p><p>Cook County topped the country in the number of black-owned businesses in 2007, according to recent data from the U.S. Census Bureau. That year the number of black-owned companies in the county reached 84,000, about 50 percent more than in 2002. The uptick in business ownership occurred at the same time the county's African-American population declined slightly.</p><p>Rashid Carter, professor of economics at Olive-Harvey College, says it's more important to look at the health of those businesses, as well as their staying power. He said many black businesses wind up shutting down when they can&rsquo;t get enough capital, and that situation may have gotten worse since the data were collected in 2007. According to the National Bureau of Economic Research, an economic slump began in December 2007.</p><p>&quot;You need an expanding and robust customer base and of course you need access to financing and along those two margins, black businesses have suffered catastrophically historically but especially in the last four to five years,&quot; Carter said.</p><p>The Census Bureau data show that nationally, black-owned businesses tend to be small, with revenue less than $50,000.</p><p>&nbsp;</p><p>&nbsp;</p></p> Wed, 09 Feb 2011 06:01:00 -0600 http://www.wbez.org/story/ashley-gross/cook-county-tops-nation-black-owned-businesses Chicago's startup scene: The one that got away http://www.wbez.org/blog/city-room-blog/chicagos-startup-scene-one-got-away <img typeof="foaf:Image" src="http://llnw.wbez.org/apps-bump.png" alt="" /><p><p>You&rsquo;ve heard of <a href="http://www.groupon.com/chicago/">Groupon</a>. How about <a href="http://bu.mp/">Bump Technologies</a>? For Chicago, Bump is an example of the one that got away. <br /><br />David Lieb and his friend Jake Mintz hatched the company at the <a href="http://www.chicagobooth.edu/">University of Chicago Booth School of Business</a> when they discovered in that flurry of the first few weeks of school that they really, really hated manually typing all their new friends&rsquo; contact information into their phones. <br /><br />So, along with their friend Andy Huibers, they figured out a way to &ldquo;bump&rdquo; two phones together to transmit that contact info. And their new smartphone application was born on March 27th, 2009. Things moved fast from there - they won the school&rsquo;s <a href="http://research.chicagobooth.edu/nvc/index.aspx">New Venture Challenge</a> business plan competition and in the summer of 2009, just like Gold Rush era miners of yore, they packed up and headed to California. <br /><br />They didn&rsquo;t go with the intention of staying. After all, Lieb and Mintz still had another year of B-School ahead of them. But like lots of good tech companies, the train barreled down the tracks at breakneck speed. <br /><br />They took part in a summer business incubator program run by <a href="http://ycombinator.com/">Y Combinator</a>. By the end, they got a big, fat $3 million check from the venture-capital firm <a href="http://www.sequoiacap.com/">Sequoia Capital</a> and some Valley angel investors. <br /><br />But just because they got the money there didn&rsquo;t mean they had to stay. They could have come back to Chicago. But they didn&rsquo;t. They opened their headquarters in Mountain View, California, and now have 15 employees there and are &ldquo;aggressively hiring.&rdquo;<br /><br />Lieb says the main reason was because Huibers lived in California already. But there was another reason that speaks to Silicon Valley&rsquo;s dominance. <br /><br />&ldquo;We knew we needed to hire a bunch of people, and being here in the Valley is really where all that technical talent is,&rdquo; Lieb said in an interview. <br /><br />And even though they did talk with venture capitalists in Chicago, there aren&rsquo;t as many of them and they&rsquo;re more cautious, Lieb says. <br /><br />&ldquo;Here in the Valley, firms are okay with putting in $3 million to $5 million to $7 million in a Series A deal for a completely unproven company with some idea they want to build,&rdquo; he said. &ldquo;Whereas in Chicago, you have to convince people a bit more about what&rsquo;s your business model, how are you going to make money. Those things aren&rsquo;t as big a deal here in the Valley.&rdquo;<br /><br />These are the things that have perennially kept Chicago as an also-ran instead of a tech heavyweight. But big changes are afoot. <br /><br />All of a sudden, business incubator programs are popping up here. This year, <a href="http://www.exceleratelabs.com/">Excelerate Labs</a> launched in Chicago, mentoring 10 startups over the summer and providing them seed money in exchange for an equity stake.<br /><br />Mad-dash weekend-long incubator programs like <a href="http://chicago.startupweekend.org/">Startup Weekend</a>, <a href="http://chicago.theleanstartupmachine.com/">Lean Startup Machine</a> and <a href="http://www.socialdevcampchicago.com/">SocialDevCamp</a> have also arrived. They throw developers together with the hope of hatching viable business ideas by the end. And in September, 1,500 people attended the first-ever <a href="http://midventureslaunch.com/">midVentures Launch</a> conference, at which 35 startups presented their ideas to investors. <br /><br />&ldquo;We don&rsquo;t have a lot of places where startups can go to get information on raising funds and developing their technology,&rdquo; says Jon Pasky, senior vice president at MidVentures. <br /><br />But increasingly, there are more places like that. This summer, a space in the West Loop called the <a href="http://syncubator.com/">Syncubator</a> opened up. It provides desk space and advice to budding entrepreneurs.&nbsp; And its founder, Mike Rhodes, is launching a $5 million early-stage investment fund. <br /><br />Groupon, of course, though, is the big kahuna. Groupon founders and serial entrepreneurs Eric Lefkofsky and Brad Keywell started a $100 million investment fund called <a href="http://lightbank.com/">LightBank</a> earlier this year and have invested in eight startups so far. They&rsquo;ve become evangelists for Chicago as a rival to Silicon Valley. <br /><br />&ldquo;Eric and I are outspoken about the awesomeness of Chicago and of the ability to do great things right here and continue the heritage of our city, which is make no small plans,&rdquo; Keywell said in an interview. <br /><br />Lots of people are paying attention to this activity &ndash; including startup entrepreneurs who are weighing whether to stay here or tread down the well-worn path to California. Chiara Piccinotti cofounded her company, <a href="http://www.applyinthesky.com/">Apply in the Sky</a>, with a friend last year when they were both applying to business school. They created software that manages that process for you &ndash; keeping track of deadlines and application requirements. Piccinotti now goes to business school at the University of Chicago and is running her company at the same time. <br /><br />Their office is in San Francisco, where Piccinotti&rsquo;s cofounder, Emily Chiu, lives. So will they stay in California? Is there any chance they&rsquo;d move the company here? <br /><br />&ldquo;What we&rsquo;ve found so far is the resources at this point are much greater in the Valley, especially for a web venture of this sort,&rdquo; Piccinotti says. <br /><br />But she acknowledges the environment in Chicago is abuzz. <br /><br />&ldquo;Chicago&rsquo;s an exciting place to be in right now because it does feel like there&rsquo;s this excitement around Groupon,&rdquo; Piccinotti says. &ldquo;Things are changing. But to say that it&rsquo;s the same as the Valley now &ndash; it&rsquo;s a bit premature. When you move out to San Francisco, you see friends around you starting companies and you just feel it everywhere. You want to go out on your own and start something innovative. Here, it&rsquo;s great, but it doesn&rsquo;t sweep you like the Valley.&rdquo;<br /><br />&nbsp;</p></p> Wed, 15 Dec 2010 12:00:00 -0600 http://www.wbez.org/blog/city-room-blog/chicagos-startup-scene-one-got-away