The total amount of funding raised by digital startups in Chicago during Q2 2014 significantly outpaced the funding total during the same quarter last year. In total, Chicago companies raised $311 million in Q2 2014, more than doubling the amount raised in Q2 2013.
And the picture is even better when stepping back to look at the first six months of 2014 as a whole: the total funding amount in the first half of 2014 was $468 million, a 128 percent increase over the first half of 2013.
Companies in the B2B SaaS and in the fin tech sectors were some of the most well-funded in the first half of this year.
PowerReviews (formerly known as Viewpoints), a software company that powers the consumer reviews of products and brands, raised $35 million. Healthcare and benefits software company bswift raised $51 million. Though bswift has been around for 18 years, it is still growing aggressively at approximately 40 percent per year for the past four years.
AvantCredit, for example, raised a $75 million round right at the beginning of the year. The personal loan company is using its capital (which totals $129 million to date) to continue rapid expansion, including hiring over 100 employees.
Clearly, more and more bets are being placed on digital startups in Chicago. And those bets are paying off, as 15 Chicago tech companies were acquired or IPO'd in the first half of 2014.
Fin tech deals played a big role in exits as well as fundings. Options trading giants OptionsHouse and TradeMonster were simultaneously acquired and then merged by New York-based private equity firm General Atlantic (the deal amount was not disclosed).
The past two quarters were also great to tech companies in the HR and people management space. Large Chicago players like Fieldglass and Paylocity both closed huge deals in the first six months of 2014: Fieldglass, a vendor management system SaaS company, was acquired for over $1 billion by SAP and Arlington Heights-based Paylocity, a payroll and human resources SaaS company, IPO’d for over $119 million.
Other noteworthy exits include Apartments.com's sale for $585 million to CoStar and GrubHub's IPO for $192 million. The digital startup scene in Chicago is maturing - and doing it well.