Chicago’s Role in the HardTech Startup Ecosystem: a door in the Great Lakes and Midwest for Early-Stage Founders

This is the 4th of a series of posts about Boston, Pittsburgh, Toronto and Chicago, relevant East Coast & Midwest startup hubs for active early-stage hard tech investors. My purpose is to share a few impressions for a glimpse of the current state of Robotics, AI & AV startups in the US & Canada. In the context of post-pandemic lessons, I traveled to meet founders in the robotics industry, a vertical addressing a critical labor shortage situation, with constant disruptions in the workforce and long-term consequences that require investor’s acknowledgment.

This Porter Airlines ad got my attention, so I booked a flight from Toronto to Chicago. But as with everything in the True North, weather instability can always postpone our plans.

While kicking off our Monozukuri Ventures Canada, I followed the Billy Bishop Airport bus ads we can see next to Toronto Union Station and took a flight to Chicago. The main goal wasto compare what's going on with hard tech startups in both Windy Cities (besides the usual airport issues common in the True North). The plan to check the American side of the Great Lakes came across when I realized mHub was organizing its HardTech Day, when startups from different hubs of Midwest travel to Chicago searching for initial milestones like funding and initial customers.

Even though it was a late arrival, I could make it to the Fourth Revolution Awards Cerimony.

Note: my trip started with a 8h delay due to bad weather in Toronto (I learned that's a negative side of Billy Bishop airport). As a result, I arrived too late to check the mHub HardTech startup day, missing Arduino's founder participation.

Chicago, a.k.a. the Windy City, has been known for its rich industrial history and diverse economy, emerged as a dynamic hub for innovation and collaboration in recent years.

While Silicon Valley still keeps the spotlight of tech startups, Chicago has established itself as a thriving local ecosystem for early-stage hardware companies.

One of the key factors driving this success is the city’s unique ability to foster collaborations between these startups and corporations, with mHUB at the core of the current movement.

In my first visit to Chicago, I wondered why the area has become an important ecosystem for hardtech startups from all over Midwest, and how local collaborations have translated into benefits for all parties involved.

• Human resources: population matters, and Chicago is an urban hub constantly in transformation. With a robust manufacturing heritage, Chicago’s deep-rooted community is a vital asset when it comes to startup's development. The vibrant city has a wealth of human expertise in industrial design, engineering, and production, making it an ideal environment for hardware entrepreneurs looking to tap into a wealth of manufacturing resources. It provides startups with invaluable resources to design, build, and test their hardware products, helping them bridge the gap between concept and production. This access to shared manufacturing infrastructure enhances collaboration between startups and corporations by enabling efficient product development and fostering knowledge exchange.
• mHUB’s Incubation and Acceleration Programs: offers comprehensive incubation and acceleration programs tailored specifically for hardware startups. These programs provide startups with mentorship, educational resources, business support, and access to a network of industry professionals and investors. By participating in these programs, startups can refine their business models, access capital, and gain exposure to potential corporate partners. The structured curriculum and guidance offered by mHUB’s programs empower startups to navigate the challenges of hardware development, market entry, and scaling, positioning them for success in collaboration with corporations.
• Access to a Vibrant Hardware Community: bringing together startups, entrepreneurs, industry experts, and investors under one roof, fostering a collaborative and supportive environment. Regular events, workshops, and networking opportunities organized by mHUB provide invaluable platforms for startups and corporations to connect, exchange ideas, and explore potential collaborations. The sense of community and shared purpose nurtured by mHUB enhances the overall ecosystem by encouraging knowledge-sharing, skill development, and serendipitous encounters that can lead to meaningful partnerships.mHUB serves as a vibrant hub for the hardware community in Chicago.
• Corporate Landscape: Chicago is home to a diverse range of corporations spanning various industries, including manufacturing, logistics, healthcare, and consumer products. Such a diverse corporate landscape provides a unique opportunity for hardware startups to find strategic partners and customers within their respective sectors. Collaborating with corporations allows startups to gain access to established supply chains, manufacturing facilities, and industry knowledge that can significantly accelerate their product development and scale-up efforts. The expected results are leverage their industry expertise, customer networks, and distribution channels, opening doors to new markets and accelerating their go-to-market strategies.
• Access to Capital: Chicago’s venture capital ecosystem has been growing rapidly, with an increasing number of investors recognizing the potential of hardware startups. Collaborations with corporations can be an important catalyst for securing funding. Corporations often have dedicated venture arms or innovation funds focused on investing in early-stage startups that align with their strategic objectives. These partnerships not only provide startups with capital but also access to valuable industry knowledge, mentorship, and a network of potential customers and partners.
• R&D: strong research and academic institutions, as the city boasts world-class research institutions and universities that foster innovation and provide a fertile ground for collaboration between startups and corporations. I University of Chicago and Northwestern University have robust engineering and technology programs, producing talented graduates with cutting-edge skills and knowledge. Collaborations between startups and academic institutions can lead to groundbreaking research, technology transfer, and talent acquisition, fueling the growth of the hardware ecosystem in Chicago.
• Supportive Community and Co-working Spaces: Chicago’s startup community is known for its collaborative spirit and strong support network. The city is home to numerous co-working spaces, incubators, and accelerators that provide startups with the necessary resources and mentorship to thrive. These spaces often act as a catalyst for collaboration, bringing together entrepreneurs, industry experts, and corporate partners under one roof. Such environments foster knowledge-sharing, networking, and serendipitous encounters that can spark meaningful collaborations between hardware startups and corporations.

A few startups from mHub Chicago ecosystem:

• Maxwell Labs (Minneapolis-area, MN): AI-driven materials science to allow high-performance cooling infrastructure, integrating thermal interface materials, advanced ceramic cold-plates, dissipative coatings and novel radiative heatsink tiles. We've invested in the startup after learning about them at the mHub 2020 hybrid Demo Day, which we joined remotely.
• Hive Medical(St Louis, MI): an Internet-Of-Things (IOT) startup based developing a drug adherence monitoring system to reduce readmission by providing a CloudConnect smart catheter.
• NXgen Port (St. Paul, MN): NGP pairs catheter efficacy with new sensor technology and machine learning. It measures, monitors and reports physiological body functions over the course of disease and treatment.
• memq Tech (Chicago, IL): building rare earth-based (Erbium) technologies to enable scalable on-chip devices for quantum information storage, distribution and processing.
• Stroma Vision (Chicago, IL): computer vision based safety solutions to reduce accidents in industrial workplaces