The first tenants of the 1871 technology center in the Merchandise Mart are hiring – albeit in small numbers – underlining supporters’ contentions that tech startups in Chicago need more space to grow and create ideas and products.
The center, whose name reflects the year Chicago rebuilt from the Great Chicago Fire, will open May 2 on the 12th floor of the Merchandise Mart with the goal of housing up to 400 startup companies, center supporters announced at a news conference Wednesday. More than 300 applicants are seeking space, said Kevin Willer, CEO of the Chicago Entrepreneurial Center that is running the center as a nonprofit venture.
The center is receiving $2.3 million in state funds through the Illinois Jobs Now program to pay for construction and infrastructure buildout, said Gov. Pat Quinn, who called the tech center “a special place for creating jobs of the future.”
Quinn’s remarks were interspersed with the sounds of drills buzzing from inside the 50,000-square-foot, white-walled, exposed-pipe space, which 50 construction workers are remaking into offices, meeting rooms, conference rooms, a lunchroom and a coffee shop.
Founders of four startup companies who attended the news conference said they welcome the opportunity to collaborate and expand at the 1871 tech center (1871.com).
Erik Severinghaus, founder and CEO of SimpleRelevance, said he hopes to increase his work force fourfold by year’s end, to 20 from today’s five, after the company receives new capital funding. SimpleRelevance is a year-old startup that helps companies send targeted emails and online messages.
Severinghaus, 30, is looking for two to three new employees in the next three months, including a salesperson and technology specialists.
Dan Salcedo, the 26-year-old founder of group-buying social network startup Mobcart, intends to hire eight to 10 employees by year-end. Most will be software and database engineers.
Salcedo is moving back to Chicago after an eight-month stay in a shared workspace in Burlingame, Calif., about halfway between San Francisco and Silicon Valley, to save money on living expenses and to hire “great talent” here at half the salary commanded at Web giants such as Facebook and Google.
None of the startup leaders would discuss specific salaries because compensation varies based on hiring bonuses, incentive pay and stock option awards, but experts agree that entry-level software designers make $40,000 to $60,000, and starting software and database engineers make $60,000 to $80,000.
Neal Sales-Griffin, a 24-year-old Hyde Park native and co-founder with Mike McGee of web-programming school Code Academy, has hired most of his seven employees in the past two months, including an instructor, a teaching assistant, a content developer, a multimedia developer and a community outreach expert.
Half of Code Academy’s student applicants come from outside Chicago, including California, Australia, Germany, Canada, the U.K. and the Netherlands, and the first quarter’s graduates have been hired as a software engineer at Groupon;, a Web developer at men’s fashion outfitter Trunk Club, and as a Web developer at a fashion startup, for example.
Phillip Leslie, 32, founder and CEO of ProOnGo, which makes expense-reporting software, said he is always looking for people who can create software for smartphones, and is now hiring for two of those jobs. The four-year-old company now employs three people.