Crain's Chicago Business, June 19, 2023

F A S T

Exploring the promise and peril of ChatGPT

Local companies from United Airlines to Morningstar tread carefully as they look for ways to harness the powerful new form of arti cial intelligence

BY JOHN PLETZ

When ChatGPT was released, the rst thing JPMorgan Chase did was block employees from using it internally. en the company stepped up its experimentation with the powerful new arti cial intelligence underlying the chatbot app.

“We wanted to make sure we were protecting ourselves and our (intellectual property), and helping our employees understand that we were going to take a more disciplined approach to how we evaluate it,” says Lori Beer, chief information o cer for the giant bank, which has more than 2,000

tech workers in Chicago. “We are testing not only GPT but other large-language models.”

JPMorgan’s approach re ects the mix of wariness and excitement ChatGPT has stirred up among local companies as they consider possible uses of a new technology that burst on the scene in a tsunami of hype. In recent months, Chicago-area businesses from United Airlines to Morningstar have started experimenting cautiously with ChatGPT and its arti cial-intelligence siblings.

“Given the hype cycle around ChatGPT, there were a lot of

Remote work and crime take toll on home prices

Declines are sweeping across the city, while the suburbs are seeing increases I

HOME PRICES IN CHICAGO, but not in the suburbs, have been declining all year, a warning sign that work from home and a seemingly intractable crime problem are hurting the city’s real estate market.

In each of the six months between November 2022 and April 2023, the median price of homes sold in the city was down from the same time a year earlier, according to the most recent data from Illinois Realtors. It’s the longest stretch of declines since a 13-month period that ended in June 2011, when housing markets everywhere were struggling to rise out of the crash of 2007-2008.

Work from home and crime

FINANCE

Debt lands the local maker of Instant Pot and CorningWare in bankruptcy. PAGE 4

BY DENNIS RODKIN

are impacting many big cities’ housing markets, says Jim Russell, a Virginia-based geographer who tracks real estate, but crime may be dealing a heavier blow in Chicago than elsewhere. is is not to say that crime is the only thing causing home prices to drop in the city, only that its role has become more visible.

“ e narrative about Chicago’s underlying violence used to be that it was more prevalent in certain sections of the city,” says Sara Ware, president of the Chicago Association of Realtors and managing broker at Hyde

BOOTH INSIGHTS

Improve your pitch to hook the audience and close the deal. PAGE 9

If it were merely a TV reality show, viewers would have clicked to another channel long ago. I mean, the same old lead character, pulling the same old crazy stunts and mouthing the same old only-in-Hollywood whoppers gets a bit stale, whatever shade of hair the protagonist displays.

But this is real reality. And much as most of the country wants to, it just can’t turn away from the Donald Trump ex-POTUS Unleashed Show — whether it’s the former president’s fans, who exist everywhere, even here in Illinois and even here in Chicago, or the Democrats, who at some psychological level understand that Joe Biden can beat Trump but perhaps not any of the other names being bandied about for the GOP presidential nomination.

Heaven help us. I’m not sure we can do it ourselves. Even though the impact here is enormous.

From my perspective, anyone who wants to return Trump to

Somebody make it stop

o ce has their eyes and ears stapled shut. is is the guy who in the early days of the pandemic said a boat full of COVID-sick Americans ought to be kept from returning home because it would make his numbers look bad. He sent the Jan. 6 rioters to the U.S. Capitol and has dangled pardons for those convicted of misconduct.

He e ectively told federal archivists to shove it when they asked him to return secret papers that he literally hid in a bathroom to keep his attorneys from knowing about them — the case in which he’s now under federal indictment.

But from the perspective of his admirers, what counts is that Trump is a ghter against THEM: commies, Chinese in ltrators, Mexican immigrants, friends of George Soros, voracious drag queens, liberals, et al. If Biden hasn’t been indicted for improperly possessing secret papers and Hillary Clinton wasn’t prosecuted for storing classi ed government

emails on her private server, then Trump should get a pass, too, they argue — ignoring the fact that Biden has cooperated and is still under investigation and that Clinton was still secretary of state with a legal right to those emails and arguably lost the 2016 election to Trump over her sloppy handling of the matter.

So, on the show goes.

It seems pretty clear to me that Trump has all but given up on winning his case in a court of law. After all, repeatedly attacking the wife of Special Counsel Jack Smith, chief prosecutor in this case, is about as smart as former Illinois Gov. Rod Blagojevich asking if then-U.S. Attorney Pat Fitzgerald was “man enough” to meet him in court. How did that work out at trial, Rod?

Where Trump is trying to win is in the court of public opinion, where a growing GOP eld of presidential candidates raises the odds that Trump will win the Republi-

GREG HINZ ON POLITICS

can nomination. And if he wins the presidency, too, he then can order the Justice Department to drop any case against him — and maybe pardon himself.

Democrats say they shudder at the thought. But party pros have got to know that while Biden can beat Trump — again — his job approval rating in the low 40s makes his odds against a Ron DeSantis or Chris Christie or Tim Scott considerably lower.

Also shuddering are Illinois Republicans — at least those interested in actually winning statewide o ce rather than making a point. As I wrote about a few weeks ago, major funders and much of the party’s leadership know that a

Trump nomination will kneecap the GOP’s ability to rebuild in its natural political base of Chicago suburbs. at will only hurt Republicans’ ability to push items of importance to them in Spring eld, especially tax and business issues that long have been the party’s bread and butter.

at should worry Democrats, too, because, ultimately, total domination by one party is not healthy. At the moment, it’s leading to two countries — one red, the other blue — into a sort of quiet civil war over what it means to be an American.

Can’t someone cancel this show? Even as pure entertainment, it’s gotten really, really old.

Housing is still key to reining in in ation

In the past year, the Federal Reserve has acted to raise the federal funds rate by ve percentage points. Despite higher rates on credit cards, personal loans and mortgage rates, core in ation remains stubbornly high. And there’s mounting evidence that the central bank may not be able to tame in ation on its own. With the enduring strength of home values supporting strong consumer spending, homebuilders might just be the Fed’s most important allies for reining in in ation.

Rate hikes are a powerful tool for the Fed, but many factors a ecting U.S. in ation are simply out of their control — from the supernatural-like climate shocks (droughts, oods, and wild res that a ect food supply and disrupt supply chains) to selfin icted pain caused by delayed building permit approvals and onerous regulations that restrict where and how we build, raising housing costs for buyers and renters. Despite a large decline in rent growth, housing is still the largest contributor to the monthly in ation rate increases.

While lower-income households might be feeling the squeeze from stubbornly high in ation and record interest rate increases, higher income households — especially those who own their homes — have been somewhat shielded from the Fed’s actions. e roughly $500 billion in excess savings is still supporting strong consumer spending, which in turn puts upward pressure on prices. While that will run out eventually, research shows that consumers also spend out of their stock market wealth and their housing wealth.

Stock market wealth is already lower than it was before the central bank’s campaign against in ation began. e S&P 500 is back to its May 2021 level, when headline in ation was roughly what it is today. On the other hand, housing wealth — measured by homeowners’ equity — is still near a record high. Home values have been slower

to respond to the Fed’s squeeze this time around because housing is still undersupplied in most markets.

Household formation has outpaced growth in the nation’s housing stock, according to data from the American Community Survey. From 2015 to 2021, the number of new households grew by 6.1% compared to just a 4.7% increase in the number of new homes. As a result, the stock of available vacant housing decreased, and housing markets have gotten tighter and more expensive.

e problem is even worse when one considers that a large number of families have yet to move out into their own homes. In 2021, there were roughly 8 million lower-income families living with non-relatives, many of which likely would have preferred to live on their own, but only 3.7 million homes were available for rent or for sale. Since then, the U.S. population grew by an estimated 2.5 million, with net international migration accounting for more than 1 million arrivals into the United States. So long as housing needs outpace the supply of homes, home values will remain stubbornly high.

e rapid increase in home values during the pandemic means that homeowners now have an average of $302,000 in in ation-adjusted equity in their homes. And research shows that consumers spend about ve cents out of every dollar increase in housing wealth. e increase in housing wealth has made middleand high-income households extremely resilient in the face of higher in ation and record interest rate increases. And so long as homeowners can continue to tap into their home equity to nance consumption or to pay o more costly debt, they will be somewhat shielded from the Fed’s e ort to tame consumer spending and getting in ation back to the 2% target will be a tall task.

As mortgage rates increased and most segments of the housing market cooled, competition for relatively

more a ordable entry-level homes intensi ed. A large in ow of more a ordable entry-level homes would cool the segment of the housing market where price pressures have remained elevated. Homebuilders might just be the Fed’s most important allies for reining in in ation.

e good news is that there are nearly 1.7 million homes under construction across the country. But that’s still a drop in the bucket when compared to what’s currently needed. Allowing builders to ramp up new residential construction needs to become a government priority.

One area for improvement are zoning reforms that would allow for

more housing units as opposed to just single-family detached homes. is alone would create millions of critically needed new housing units. Other bene cial changes, such as eliminating or reducing parking requirements, minimizing building permit approval delays, establishing and expanding the a ordable housing trust fund should also be

explored. Newly built homes will also need to be energy e cient and climate resistant.

Crain’s contributor Orphe Divounguy is a senior economist at Zillow Group and former chief economist at the Illinois Policy Institute. His views do not necessarily re ect those of his employers.

Exelon could force Pramaggiore to repay legal fees

That’s just one of the recommendations of a special panel set up to settle shareholder lawsuits sparked by the “ComEd Four” bribery scandal

BY STEVE DANIELS

Former Commonwealth Edison CEO Anne Pramaggiore could see ComEd parent Exelon seek recovery of legal costs the company has paid on her behalf, as well as past incentive compensation, if the expected appeal of her conviction on conspiracy and bribery charges fails.

Johnson’s allies move to raise wages for tipped workers

The new mayor campaigned on eliminating the sub-minimum wage for tipped workers. Now his progressive City Council allies plan to push the issue.

I BY JUSTIN LAURENCE

Anational ght to end the sub-minimum wage for tipped workers is coming to Chicago.

Under legislation being crafted by Mayor Brandon Johnson and his City Council allies, Chicago’s sub-minimum wage for tipped workers could be gradually eliminated, a potential win for his progressive supporters — and a move that could spark a ght with restaurant owners as they recover from the pandemic.

A measure approved in 2019 under former Mayor Lori Lightfoot gradually increased the minimum wage to $15 in 2021 with annual cost-ofliving increases, but Lightfoot resisted calls for the

elimination of the tipped wage because of pushback from the hospitality industry.

Instead, the city increased the tipped wage to equal 60% of the city’s minimum wage, set to rise on July 1 $9.48 an hour for employers with more than 21 employees and $9 for employers with four to 21 employees. Employers must make up the difference between the tipped wage and minimum wage if the tips during a shift don’t bridge that gap.

But with a new mayor and more progressive City Council, the dynamics have changed.

Ald. Carlos Ramirez-Rosa, 35th, Johnson’s oor

at’s the recommendation of a special committee appointed by Exelon’s board to respond to shareholder lawsuits led following the bribery scandal that led to jury convictions last month of Pramaggiore and three others. Exelon’s board last month endorsed the committee’s proposed settlement of a handful of such lawsuits, according to a court ling.

Exelon so far has paid the legal costs for Pramaggiore and John Hooker, former chief lobbyist for ComEd, who also was convicted. Both have high-priced legal talent representing them. In Pramaggiore’s case, it’s former Northern Illinois District U.S. Attorney Scott Lassar and several other attorneys with Sidley Austin. Hooker’s team is led by prominent criminal defense lawyer Michael Monico and includes Jacqueline Jacobson in his o ce.

“If Ms. Pramaggiore and/or Mr. Hooker’s convictions were ultimately a rmed after all appeals are exhausted, the SLC (special litigation committee) believes that the Exelon board would

have a strong basis to pursue any available civil claims against Ms. Pramaggiore and/or Mr. Hooker, including for recoupment of previously advanced legal fees, compensation subject to clawback pursuant to the Company’s clawback policies and/or other claims for damages,” according to the May 26 ling by the committee in federal court in Chicago. “Particularly in light of certain changes that have been made to the company’s leadership and board, and consistent with the corporate governance reforms already put in place and to be put in place in accordance with the settlement terms, the SLC believes the board will be well-positioned to determine whether the pursuit of such claims is in the

Cboe is rewarded for playing by the rules in crypto

BY STEVE DANIELS

Slow and steady may end up winning the cryptocurrency trading race for Cboe Global Markets.

Federal approval of Cboe’s application to facilitate trades of margined futures in bitcoin and Ethereum came almost simultaneously with the Securities & Exchange Commission’s groundbreaking lawsuits against more established crypto exchanges Binance and Coinbase.

Chicago-based Cboe moved aggressively into digital assets a little over a year ago with its acquisition of ErisX, a crypto trad-

ing platform rebranded as Cboe Digital. Just a few months later, Cboe took a non-cash writeo of $460 million on the acquired business, after the nancial meltdown of major crypto exchange FTX raised questions about crypto’s future.

But CEO Ed Tilly didn’t hesitate to press ahead, betting that interest in crypto would persist.

Crypto values have made a partial comeback since then, but regulatory dangers surround rms that haven’t won the blessing of the SEC or the Commodity Futures Trading Commission.

SEC Chairman Gary Gensler, with the actions against Binance and Coinbase, seeks to force

them to register with his agency. Both rms have vowed to ght the actions.

Meanwhile, Cboe goes through existing channels to slowly grow

its nascent digital business.

at’s won the company plaudits from regulators, who seek to impose rules on what they’ve termed the “Wild West” of buying

and selling digital tokens.

“Too often in recent years, crypto rms have sought to

ESTHER LIN/UNSPLASH

A regulatory blessing gives the exchange operator an edge as the SEC comes down on rivals

Anne Pramaggiore

See TIPPED WORKERS on Page 26

See EXELON on Page 24

A long-overdue discussion

Six months ago, ahead of a critical municipal election in Chicago, we joined with Crain’s to launch a series that looked quite a bit di erent from standard election coverage. Whereas most media focused on the personal backgrounds and policy proposals of the candidates, we examined the design of the institution that the winners would occupy. Was a city council with 50 elected o cials, each representing an individual ward, best suited for a city that struggles to come together across di erences of race, income and ideology?

Beginning in February, as Chicagoans prepared to vote, we asked scholars, civic leaders and journalists whether ‘the city that works’ really does, in fact, work. We sought to inject expertise, debate, and new perspectives into a much-needed discussion about the structure of our political institutions and the performance of our local government.

Now, as the dust settles on another election cycle and our series comes to a close, it’s important to take stock of what we learned. Quite a bit, it turns out.

Crain’s contributor Steve Hendershot masterfully set the stage each month, producing deeply reported stories that weighed trade-o s, connected dots, and leveraged expertise within and beyond Chicago. ese stories compared Chicago’s city council to other local legislative bodies across the country, illuminated its troubled budget process, reviewed its history of corruption, exposed the downstream e ects of aldermanic power and representation on hot-button social policies, and more.

From these stories as well as the opinion

pieces and programming that followed, we came to appreciate just how unusual Chicago’s city council really is. Here, each alderperson represents 54,000 Chicago residents. In New York, by contrast, alderpersons represent 166,000 residents. In Los Angeles, they represent 256,000 residents. ese basic facts have profound consequences for the kind and quality of government we get. For starters, Chicago alderpersons are particularly attuned and attentive to the local interests in their wards. As 22nd Ward Ald. Mike Rodriguez put it, “the people of my ward have a connection to me that they — and I — believe has great value. e more people I have to represent, the harder that would be.”

Other political observers, however, underscored the costs of present institutional arrangements. e sheer size of the council, said some, impedes its ability to organize itself, govern e ectively and guard against mayoral encroachments. In the absence of additional governing capacity (such as a more robust City Council O ce of Financial Analysis, a chief administra-

tive o cer, or operational support and resources for the city council) or procedural guardrails (such as a city charter), the balance of power between the council, the mayor and city agencies tilts in di erent directions depending on the issue at play. roughout the series, experts identi ed promising reforms to the city council and larger political system. Former Inspector General Joe Ferguson, for instance, advocated for the establishment of a city charter that would augment external accountability and stimulate further thinking about the need for systemwide institutional reform. rough her scholarly research, Jessica Trounstine argued on behalf of smaller city councils like Houston’s, which include a mix of both ward-based and atlarge council members.

Turning to city budgets, Justin Marlowe pointed toward the need for deeper investment in the City Council O ce of Financial Analysis to give council members meaningful input on spending plans. To reduce corruption, Inspector General Deborah Witzburg advocated for clear policies and good training around electoral transitions for the city council.

Each of these ideas has real merit. From our vantage point, though, their articulation is just a start. If we are to meet the challenges that have plagued Chicago for so long, we need to lean further into this conversation about the institutions that govern our city. Individual testimonials that lament the pervasive gridlock and dysfunction are not enough. To make real progress, we need to put our institutions squarely in our sights and invite prolonged scrutiny and debate about how we might reform them.

Exactly 100 years have passed since the size and structure of Chicago’s city council was set. It’s long past time to think anew about what kind of city council — and with it, what kind of city government — we need to meet our present policy challenges. May ‘One City, 50 Wards’ serve as just the start of a much longer investigation into the institutional reforms needed to build a better Chicago.

Debt lands Instant Pot, Pyrex maker in bankruptcy

The private-equity owner of Downers Grove’s Instant Brands plucked a debt- nanced dividend of $245 million out of the company in 2021, when the pandemic was fueling big sales

BY STEVE DANIELS

When the company that makes and sells the Instant Pot cookers merged with the maker of Pyrex and CorningWare products in March 2019, the deal looked like genius a little over a year later after the pandemic hit.

With people stuck at home, sales of home cooking products soared.

But the sales spike was the business equivalent of a sugar high. Sales fell as consumer tastes shifted and costs rose due to in ation and supply-chain snarls. ose issues, combined with rapid interest-rate increases in 2022 as the Federal Reserve responded to in ation, landed the Downers Grove-based company, called Instant Brands, in bankruptcy court in Houston last week.

e story the company’s chief restructuring o cer told in court lings was one pinning the blame on forces outside the company’s control.

ere was no mention made of how the $391 million in debt, which Instant Brands owes to non-bank rms whose interest rates tend to be considerably higher than commercial banks, played a role in the company’s current plight. at tale is familiar. Instant Brands is majority-owned by Cornell Capital, a New York-based

private-equity rm that engineered the 2019 merger after initially purchasing locally based World Kitchen, the Pyrex and CorningWare company, in 2017.

Interest rates were low at the time of both those transactions, enabling Cornell to tap debt markets to help nance them. Terms for neither deal were disclosed.

Good times were just around the corner.

“Unlike other companies, Instant Brands bene ted initially (from the pandemic), in late 2020 and most of the rst half of 2021, from an increase in consumer demand for its products when people turned to more home-cooked meals due to governmental stay-at-home orders throughout the world,” according to Chief Restructuring O cer Adam Hollerbach’s account in a ling.

$450 MILLION TERM LOAN

In April 2021, in the midst of that sunny period, Instant Brands took on a $450 million term loan, according to the ling. at debt re nanced $294 million in existing debt, including $100 million tied to the 2019 acquisition, and helped support a $245 million dividend to the shareholders, according to a Moody’s rating of the loan in May 2021.

Essentially none of the debt, then, supported investment in the business.

Moody’s estimated then that debt as a multiple of earnings before interest, taxes, depreciation and amortization would be a manageable three times, “mainly driven by earnings growth.”

But, Moody’s warned at the same time, “ e legacy Corelle Brands’ business (Pyrex, CorningWare etc.) operates in the cyclical and mature housewares category, and it’s highly reliant on a single, specialized manufacturing facility for its namesake brand. An extended supply chain disruption from situations such as the coronavirus would adversely a ect the

company’s revenue and EBITDA.”

A year later, the warning became reality. By the second half of 2022, “with the U.S. economy reopening, consumer discretionary spending switched from ‘at home’ merchandise purchases to those related to services or experiences,” according to the court ling. “As the year progressed, consumer debt increased to an almost record high and consumer sentiment dropped to recessionary levels. Consequently, Instant Brands and other consumer goods companies

An ongoing collaboration between Crain’s Chicago Business and the University of Chicago’s Center for E ective Government. ChicagoBusiness.com/OneCity50Wards

William G. Howell, left, is the Sydney Stein Professor of American Politics and director of the Center for E ective Government at the University of Chicago. Sadia Sindhu is CEG’s executive director.

The ‘One City’ series raised important questions about the design of the City Council. Now it’s time to nd answers.

BLOOMBERG

POWER BREAKFAST

Over 200 people joined Crain’s Power Breakfast: Building 21st Century Neighborhoods from Scratch in early May. The event featured commercial real estate power players Curt Bailey from Related Midwest and Andy Gloor from Sterling Bay. They spoke with Crain’s Senior Reporter Alby Gallun about the future of the city as each of the companies they lead is poised to establish a brand new neighborhood in Chicago.

Chicago home prices decline amid remote work, highly visible crime problem

Park-based Ware Realty Group.

“But now it’s in all parts of the city,” Ware says. “When you see businesses are moving out and you hear the media coverage of violence, you start to develop your own story about where you should live.”

Citadel and Boeing are the two highest-pro le businesses to leave the city recently, and McDonald’s CEO Chris Kempczinski publicly warned about the growing perception that Chicago is unsafe.

Mayor Brandon Johnson’s administration is aware of the impact of crime on property values. A spokesman for Johnson wrote in a statement to Crain’s that “public safety is of utmost importance,” not only because of the lives at stake but because safety “factors into home ownership.”

Chicago is not alone. In ve big cities with distinct city-suburban markets and declining prices, city home values are down more than the metro areas by at least 2 percentage points. at’s according to Crain’s examination of data for Boston, Philadelphia, San Francisco, Seattle and Washington, D.C. on Red n, an online real estate marketplace.

In San Francisco, city condo prices dropped to about 2014 levels in April, the San Francisco Chronicle reported, while prices in the overall Bay Area rose.

“ is is a dynamic that’s not unique to Chicago,” Russell says. Nor is urban crime.

Nevertheless, a marked drop in home values is never a good sign, particularly for a city whose image

has been bruised repeatedly in recent years. If it becomes a prolonged decline, one result among many will be a struggle to keep property tax collections su cient to fund services without jacking up tax rates beyond their already painful levels.

By April, the median price of homes sold in Chicago — $340,000 — was a mere 0.5% higher than the median for April 2020, just before the dawn of the COVID-era housing boom. It’s almost as if the boom never happened in the city.

e declines are not con ned to the downtown condo market, which aside from some headline-grabbing, ultra-high-priced sales has been reeling for a few years. House prices are down in many parts of the city, even in suburban-like, outer-city neighborhoods such as Beverly, Edison Park and Forest Glen. In all those neighborhoods, the median price of homes sold this spring was below their pre-COVID level.

SUBURBAN MARKET

In contrast to Chicago, prices in the nine-county metro area rose steadily since September 2012 until dipping in April. And that appears to be the result of the city’s 8.1% drop in April. Because city sales represent about one-quarter of the metro’s sales, that drop was enough to push the regionwide gure down 1.5%. A strong suburban home market has lifted the median price of homes sold in the metro area to $320,000, up 18.5% in the three years since the pandemic boom launched.

e reports from Ilinois Realtors do not include suburban-only data. ey provide city-only data

and metrowide data that includes the city.

ere’s ample evidence that crime and the perception of poor public safety reduce property values. A 2016 overview of numerous academic studies on the topic said that, “A high crime rate is strongly and negatively associated with neighborhood quality, having a marked impact on the prices homebuyers are willing to pay for a house.”

Of course, crime is not the only factor in Chicago’s price drop.

Population loss is another. According to the U.S. Census, Chicago lost over 81,000 people between July 2020 and July 2022. e drop means there were 1.1% fewer people living in the city in 2022 than in 2010. at’s lost demand for homes.

“Population loss has been a problem for Chicago since before the pandemic,” says Geo Smith, executive director of the Institute for Housing Studies at DePaul University. Before COVID, the losses were

mostly in Black and lower-income neighborhoods, “and growth in the population of higher-income individuals,” he says, but “data since the pandemic is a bit fuzzier.”

If future data shows more high-income people are leaving Chicago, it will help explain the median price decline. e median is the midpoint on a list of all sales, from lowest-priced to highest. If upper-priced sales become fewer, the median may drop.

LONG COMMUTES

Another related factor: “Work from home is a really big deal,” says Andrew Hanson, an economist and associate professor at the University of Illinois Chicago’s Stuart Handler Department of Real Estate. Since COVID and the subsequent work-from-home permissiveness severed the link between work and workplace, he says, “cities with long commutes are the ones that have been most impacted — New York,

San Francisco, Chicago. Before the pandemic, Chicago had some long commute times.”

In 2019, the city ranked 5th among U.S. cities, according to U.S. News & World Report, with an average commute time of 31.6 minutes. Hanson says the work-from-home edicts may have felt liberating to some homeowners in places like Beverly and Edison Park, who could trade suburban-like areas for farther-out suburbs “where they could a ord more house and have more space.” With work from home now several months into its fourth year, Hanson says, “I’m not surprised that you see home prices decline in the city.” ere’s also ongoing frustration with the Chicago Transit Authority’s lack of cleanliness and promptness, as well as strikes and near-strikes at Chicago Public Schools.

“If the services I’m getting for the taxes I’m paying don’t seem like enough,” Hanson says, “I can look somewhere else.”

Instant Pot, Pyrex maker lands in bankruptcy

reported deteriorating sales and margins and weaker earnings, thus necessitating downward revisions to market forecasts.”

Hollerbach’s account goes into great detail on multiple rounds of cost-cutting, including at Instant Brands’ Downers Grove headquarters, and several price increases the company pursued in response to the “series of uncontrollable macroeconomic events over the last three years, including the COVID-19 pandemic, the Russia-Ukraine war, supply chain disruptions, changing consumer preferences, increased freight and transportation costs, and rising in ation.”

e account doesn’t address shareholders’ decision to pluck $245 million in cash out of a notoriously cyclical business when Instant Brands entered into the $450 million loan.

A spokeswoman for Cornell declined to comment. Cornell owns 70% of common stock while current and former management and

founders hold the rest.

e ling doesn’t disclose Instant Brands’ nancials in 2020 and 2021. Moody’s forecasted free cash ow of $55 million to $60 million in the rst half of 2021.

In 2022, Instant Brands’ earnings before interest, taxes and depreciation and amortization (a proxy for cash ow) were a little over $57 million — for the whole year. e $400 million or so in debt at the time amounted to six times cash ow — double Moody’s anticipated multiple in 2021 — and a level that likely would have induced a traditional bank to declare a default.

With interest rates rising, a conservative rate of 7% would mean debt service of $28 million on the interest alone. at doesn’t include principal payments.

SUPPLIERS TIGHTEN TERMS

By the rst quarter of 2023, the nancial picture was considerably darker. Cash ow was just $5.9 million, according to Hollerbach’s ling, on track to generate less than $24 million for the year. at

wouldn’t be enough even to service the debt.

Aware of Instant Brands’ issues, suppliers tightened terms for delivery in the past few months. With loan payments due in June, Cornell and the company tried to restructure nancing outside of bankruptcy. But they ran out of time, according to the ling.

Instant Brands won court approval for $125 million in debtor-in-possession nancing and other debt that will enable the company to operate. It employs more than 1,800 in North America, including 140 in Downers Grove, home to headquarters and a distribution facility.

A lawyer for the company said in a court hearing that it’s open to a buyer, Bloomberg reported. If that happens, it won’t be the rst time an owner of Pyrex and CorningWare has been acquired out of bankruptcy.

Oaktree Capital and W Capital Partners bought World Kitchen out of bankruptcy in 2004. ey were the sellers to Cornell in 2017.

INSTANT POT from Page 4

Chicago is not alone. In ve big cities with distinct city-suburban markets and declining prices, city home values are down more than the metro areas by at least 2 percentage points.

Here are some cool dining spots that will welcome your dog this summer

As the weather gets warmer and spring turns into summer, pet owners are looking for places to eat where they can bring their dogs. While many bars and restaurants allow dogs on their outdoor patios, not all will provide your furry friends with their own food and water — and occasional dessert. Here is a list of places that will treat your pups just as well as they’ll treat you.

w Bar Siena

Illinois’ largest nonprofit retirement community lands in bankruptcy

BY ALBY GALLUN

The largest nonprofit retirement community in Illinois, Friendship Village of Schaumburg, has filed for bankruptcy protection, unable to recover from the devastating blow of the COVID-19 pandemic.

Friendship Village, an 815unit facility near Schaumburg and Roselle roads, has defaulted on more than $125 million in debt and filed a Chapter 11 petition after an unsuccessful effort to find a buyer, according to documents filed June 9 in U.S. Bankruptcy Court in Chicago. The nonprofit facility, which continues to operate, aims to have better luck seeking a buyer through a court-supervised sale process.

ing facility.

Built in 1977, the Schaumburg facility was the largest nonprofit senior living community in Illinois at the end of 2021 and the 24th-largest in the country, according to a report from B.C. Ziegler, an investment bank, and LeadingEdge, a research and advocacy group.

ENTRANCE FEES

Like other retirement communities, Friendship Village relies heavily on revenues from entrance fees, one-time refundable payments that residents make when they move in. Typically, the property’s entrance fee sales total eight to 10 units a month, according to the statement. But sales plunged during the pandemic, impairing the facility’s ability to make debt payments.

Located on West Randolph Street in the West Loop, this Italian restaurant and bar has a dog-friendly patio complete with a “Puppy Ciao” menu. You can order an entree or dessert for your pup, and a percentage of the proceeds from orders for dogs goes to PAWS Chicago.

w The SoFo Tap

Every Saturday, e Sofo Tap in Uptown holds “Doggy Days,” where people are invited to bring their dogs to enjoy free dog treats and drink deals. Dogs are welcome both indoors and outdoors. e restaurant also supports the LGBTQ+ community and a variety of charitable organizations and sports leagues.

w Andros Taverna is Mediterranean restaurant in Logan Square has added a summer menu for dogs. Patrons

can bring their furry friends to eat alongside them, with an entree for dogs and homemade dog treats available for purchase.

w The Perch

Dogs can join their families in the outdoor dining area at this Wicker Park restaurant, bar and brewery. e menu even has food selections for dogs, including a “pupsicle” made from honey yogurt, peanut butter and banana.

w Michael’s Original Pizzeria & Tavern

Despite being a pizza restaurant, the menu at this Uptown

spot is extensive — and you can even order a side of chicken for your dog, who is allowed to sit with you on the outdoor patio. For those sitting inside, 39 TVs display a variety of ongoing sports games.

w Barrio

At the corner of Clark and Kinzie in River North, this Mexican restaurant has an outdoor patio that is dog-friendly. While you eat, you can also order your dog an entree of grilled chicken, a burger patty or a skirt steak. For a taste of something sweet, there is a dessert menu for both humans and dogs.

“We expect no changes in dayto-day life in our community due to this process,” Friendship Village President and CEO Michael Flynn said in a statement. “People who wish to join our vibrant lifestyle and true tradition of life care can still do so during this time of restructuring.”

Friendship Village is a continuing-care retirement community, with independent living, assisted living and a nursing home all in the same property. Residents can move in when they’re active and healthy, knowing they’ll have the help they need as their health declines and they move into assisted living and eventually the property’s nurs-

“Without the ability to tour prospects for nearly a year, occupancy dropped significantly, leaving Friendship Village with the financial hardships that are being resolved through this debt restructuring process,” the statement said.

Starting in March 2022, Friendship Village hired Ziegler and then a broker of senior living properties to find a buyer for the facility, according to a bankruptcy filing. Though a buyer emerged, it informed Friendship Village representatives that it would prefer to buy the facility out of bankruptcy. Friendship Village aims to hold an auction on Oct. 3 and to complete a sale in December, according to the filing.

Including unpaid interest, Friendship Village owes $131 million to investors that own bonds used to finance the property.

TOTAL COMMITMENT® TO CLIENTS TO C OLLEAGUES TO C OMMUNITY

These places will treat your pups just as well as they’ll treat you I

BY AVERY DONMOYER

ISTOCK

GOOGLE

The pandemic dealt a devastating blow to the facility, which hopes to nd a buyer in a court-supervised sale

Friendship Village in Schaumburg

SALES PLUNGED DURING THE PANDEMIC, IMPAIRING THE FACILITY’S ABILITY TO MAKE DEBT PAYMENTS.

Retiring president of Evanston Hospital predicts NorthShore’s next big challenge

Silverstein sees sta ng challenges, genomic opportunities in Evanston Hospital’s future

BY JON ASPLUND

After 30 years helping run two NorthShore University HealthSystem hospitals, Doug Silverstein will say his last goodbyes to employees at the end of the year and immediately head about as far away as you can get from Evanston Hospital — a vacation to New Zealand.

While he says he’s leaving the 354-bed hospital in good hands, those hands will be kept busy meeting both challenges and opportunities facing health care. NorthShore — EdwardElmhurst Health has not yet named his successor.

Silverstein came to Evanston Hospital as a vice president in 1992, was named president at Glenbrook Hospital in 1998 and moved to the president’s role at Evanston Hospital in 2012.

Silverstein says the biggest challenge the hospital continues to meet is staffing.

“The availability of staffing, the whole staffing area, has been a bit of a conundrum since the pandemic,” Silverstein said.

e combination of the “great resignation” and increased demand for services that were put o during the height of COVID-19 “put us in a crush, with signicant wait times for primary care. And a signi cant amount of business growth, with the overall organization gaining scale in adding Swedish Hospital, Northwest Community Healthcare and Edward-Elmhurst Health.”

DAUNTING TASK

Silverstein says the nursing shortage and the task of bringing in new nurses to the hospital is an especially daunting task going forward.

“It can’t be about just finding people; we’ve got to look at how we retain people, how we communicate and compensate them,” he said.

One sta ng accomplishment

Silverstein said he’s particularly proud of is the Aspire program, which is reaching out to Evanston-area high schoolers and the larger 18-to-30-year-old population with internships and other programs to showcase all the careers at the hospital, “from nance to health care IT, to lab technician to inpatient units,” he said. e program o ers scholarships and shadowing opportunities for Evanston Township High School students.

Another challenge Silverstein says the hospital and health system are in a good position to meet is in growth of information systems.

EARLY ADOPTER

Silverstein likes to point to being an early tech adopter, especially in the first half of his career. In 2003, Glenbrook Hospital became one of the very first hospitals to institute an electronic health record from a nascent software company out of Wisconsin — Epic. Epic Systems is now one of the industry’s leading EHR companies.

“We were all scared to death when it went live,” he said. “We heard about physicians revolting. We were going to require doctors to have 16 hours of training, but would they stick around for that?”

The EHR, however, turned into a great evolution in medicine, physicians came to embrace it and it put NorthShore in the position of getting in on the ground floor, helping Epic design and redesign EHRs with a patient focus, Silverstein said.

Now, a new kind of technology rests in Silverstein’s successors’ hands.

“Genomics — personalized genomics — is a space that’s really going to explode, through new ways to diagnose and provide preventative care,” Silverstein said.

Using genetic sequencing

and pharmacogenomics, you can determine that a common antidepressant therapy, for example, will or won’t work on a certain patient, he said.

“That’s huge,” Silverstein said. “Think about the trial-and-

“It will take a little bit of physician education to get them comfortable to use it, and patient education, through a team of genomic ambassadors.”

The genomic institute is working on building genomic

THE COMBINATION OF THE “GREAT RESIGNATION” AND INCREASED DEMAND FOR SERVICES THAT WERE PUT OFF DURING THE HEIGHT OF COVID-19 “PUT US IN A CRUSH, WITH SIGNIFICANT WAIT TIMES FOR PRIMARY CARE.”

Doug Silverstein

error nature of how we currently prescribe some drugs.”

The use of genomics for preventive care and screenings is also ramping up at NorthShore through its Genomic Health Initiative, Silverstein said.

medicine to scale, and it will be years in the making, he said.

“But we’re the ones pushing it forward,” Silverstein said.

As he begins to offload more duties to other Evanston Hospital leaders and starts to move

into a more advisory role, Silverstein says he will miss getting to know the staff personally. He said that through the years he’s always made it a priority to walk the halls and talk and listen to everyone from clinical leaders in their hospital units to the food service team members, who used to take him out to monthly lunches to connect more closely.

This Christmas season, he said, will likely be the last time in 25 years that he and one of his nurse leaders will hand out cookies, It’s been a tradition with them for around 25 years, Silverstein said, from back when the nurse’s three sons would join them on their cookie rounds.

He’s hoping the three boys, well into adulthood by now, will join them this year.

Crypto regulatory blessing gives Cboe a leg up as SEC comes down on rivals

take a business model or market structure that exists in an unregulated environment and port it over to the regulated environment,” CFTC Commissioner Christy Goldsmith Romero wrote as the agency approved Cboe’s margined futures. “The CFTC does not have a window into the risks associated with models or structures in an unregulated environment.

Cboe has not done that, instead operating within the parame -

ters of the traditional futures market structure and regulatory framework.”

The green light from regulators also gives Cboe a potential competitive advantage, allowing it to move forward with crypto trading while rivals operate under a regulatory cloud. Cboe offers fully collateralized bitcoin and Ether futures. Now, investors will be allowed to purchase the futures on margin, meaning they have to front cash for just a portion of the value of the investments. Additionally,

investors can make spot trades of five different digital coins on Cboe’s platform.

OPTIONS

Cboe next will turn its attention to crypto options as it determines what to seek regulatory approval for, a spokeswoman said. Options, she emailed, are “still aspirational at this stage. Our focus now is still on launching the margined futures for which the application just got approved, and getting customers onboard, and building

liquidity in these products.”

Options make up most of the trading on Cboe, particularly its VIX volatility index option and its Standard & Poor’s 500 index option.

Trading activity at Cboe Digital has increased tenfold since Cboe acquired ErisX in May 2022, she said. Volume has averaged $50 million to $70 million a day this year. In February, volumes got to as high as $350 million on some days, she said.

“We can read the headlines (with crypto and regulatory

battles), but that was really not the business that we were chasing anyway,” Tilly said June 8 at an investor conference. “It is, I think, what we’re all looking for in the U.S. . . . some clarity out of the SEC and CFTC. “We know that our partners in Cboe Digital don’t want to break the rules, but they want to know what the rules are. So any opportunity for clarity, we think, is (an) opportunity in general to grow the space and to grow it in a very regulated and trusted way.”

Doug Silverstein joined Evanst on Hospital as a vice president in 1992, was named president at Glenbrook Hospital in 1998 and moved to the president’s role at Evanst on Hospital in 2012.

EVANSTON HOSPITAL

Pitch tips: Hook with a story and clearly explain complex topics

The stakes are high for startups whose business models are based on high-tech innovation in engineering or significant scienti c advances. Funding is tight amid looming economic uncertainty, persistent in ation and global instability, rising interest rates, a systemic collapse of banking institutions, slowing venture investment trends and tight tech job markets.

If there were ever a time for someone to hone their ability to pitch ideas, now is the time.  inking back through my experiences listening to and delivering pitches in various settings over the years, I can’t help but wonder why so many people struggle to communicate their ideas.

Most of us are misguidedly taught that a great pitch is about following a set of procedures, when in reality it’s about capturing and keeping attention. Typically when pitching, and especially when discussing innovation in deep tech, we don’t take into account how the brain receives new ideas and the limits of people’s attention spans. So our most important messages have a surprisingly low chance of success-

fully breaking through. You can do everything well — have extensive knowledge about your topic, clearly convey your most important points, be super-organized — and still not be convincing enough to persuade others and close deals.

e best pitches tell a persuasive story and enable the audience to quickly connect the dots. To help increase your chances of hooking your audience and closing deals in any setting, here are a few quick tips: Tell a compelling story that intrigues, emotionally captures and delights people in unexpected ways. You don’t need to be a superhero to tell a great story. ink about an experience that excited you, made you come alive, or a situation when you overcame a seemingly impossible obstacle or con ict. Connect that experience to the idea you are pitching. Put the audience in that moment, paint a vivid picture and describe the people involved. Don’t hide your excitement, enthusiasm or emotion when telling the story. is approach will cause your audience to genuinely care and empathize with the people in your story. People forget facts, but they never forget a good story.

Ezunial “Eze” Burts is director of Duality, a pioneering quantum startup accelerator at the Polsky Center for Entrepreneurship & Innovation at Chicago Booth. Burts is also a startup founder in the quantum technology industry and has worked to advance Fortune 500 science and technology programs and strategies from concept to university lab to marketplace.

Clearly explain complex topics. Complexity is everywhere. is shouldn’t cause us to shy away from explaining complex topics

to audiences who don’t share our levels of expertise, or worse, intimidate people with technical jargon. Take the rapidly expanding quantum technology eld, for example. Many are betting on quantum to transform our lives, society and the economy more profoundly than any technology we’ve ever discovered. Countries, research institutions, companies and investors have dedicated signi cant resources in the race to achieve quantum supremacy, a 21stcentury gold rush of sorts. Simply put, quantum computers perform certain types of calculations much faster than the traditional computers we use today.

A key indicator of success is

how e ectively these companies communicate their technologies and business models in ways that make quantum real and accessible for non-technologists — ultimately to attract investment. During our Duality business training sessions, we instruct companies to use clear, enjoyable, memorable, easy-to-understand metaphors to explain their topics. We encourage the founders to ask themselves, “How would you explain this topic to a 10-year-old or your grandparents?” While simplifying a concept you’ve worked long and hard to perfect might seem counterintuitive, doing so, and telling the story of this work, will help you close the deal.

Advice for small businesses and entrepreneurs in partnership with the University of Chicago Booth School of Business.

Send this minimum-wage idea back to the kitchen

Atop-notch waiter or waitress knows timing is everything. ere’s a proper time to approach the table to take the customer’s order, a proper time to clear away plates between courses and, perhaps most important, a proper time to deliver the check.

Being a great server is hard. So is running a restaurant. A new ordinance soon to be slipped under the heat lamp in Chicago City Council chambers will likely make it more di cult to do both — at the worst possible time for the city’s dining economy, a scene that has long been one of Chicago’s most enviable features and made the Windy City a magnet for “gastro-tourists” the world over.

As Crain’s Justin Laurence reports, Mayor Brandon Johnson and his City Council allies are whipping up an ordinance that would gradually eliminate what’s known as the sub-minimum wage for tipped workers and lift their hourly pay to the same level as the standard minimum wage. It’s a potential win for the progressive activists who helped vault Johnson to o ce — and it also portends to be a ashpoint of con ict with restaurant operators still reeling from the aftere ects of COVID-era lockdowns.

One Fair Wage, a national advocacy group that has partnered with the in uential Service Employees International Union to push for the elimination of the tipped wage, held an initial brie ng at City Hall with some aldermen since Johnson’s election, sources tell Crain’s. e tipped wage is expected to be phased out over time if any such ordinance goes through, but the length of that phaseout will be central to negotiations between the coalition pushing for the legislation and industry groups, including the Illinois Restaurant Association.

A measure approved in 2019 under former Mayor Lori Lightfoot gradually in-

creased the minimum wage to $15 in 2021 with annual cost-of-living increases, but Lightfoot resisted calls for the elimination of the tipped wage.

Instead, the city increased the tipped wage to equal 60% of the city’s minimum wage, set to rise on July 1 to $9.48 an hour for employers with more than 21 workers and $9 for employers with four to 21 workers.

Employers must make up the di erence between the tipped wage and minimum wage if the tips during a shift don’t bridge that gap.

But with a new mayor and a more progressive City Council, the political dynamics have changed. Unfortunately for many restaurant owners, however, the economic dynamics have not.

Interest groups on all sides of the issue are armed with economic impact studies

that claim to answer whether or not standard minimum wages kill jobs or create jobs for workers who have traditionally relied on tips for the bulk of their livelihoods. One of the most comprehensive, conducted by an economist at the U.S. Census Bureau in 2016, found surprisingly enough that increasing the tipped minimum wage has the e ect of increasing that portion of wages paid by employers, but decreases servers’ tip income by a similar percentage — so, from a take-home pay perspective, sort of a wash. For the restaurant owner, however, decidedly not. What most of these studies have in common, however, is that they were conducted before the pandemic struck — and that’s where the emphasis on timing comes in.

A stroll through any neighborhood in

Chicago — but particularly downtown — will reveal everything most readers need to know about the state of the restaurant industry now. Old standbys shuttered during the pandemic and have yet to return. Even the former Loop locations of many fastcasual joints like Panera and Pret a Manger — whose employees didn’t rely on tips — stand vacant.

And many of the restaurants that remained open through it all are struggling to nd skilled workers — and are willing to pay better to attract and keep them. As recently as March, Crain’s reported that for every two job openings in food service nationwide, there was only one unemployed person to potentially ll the gap.

Meanwhile, with Loop o ce workers spending roughly $2,000 less per year on entertainment near their workplace now compared with 2019, according to one recent study, restaurants are feeling the pinch.

It’s not all doom and gloom. Crain’s latest gures show the number of workers returning to their o ces has slowly ticked upward this year, leveling o recently in the 50% range of pre-pandemic levels, a surge that’s helped fuel a nascent rebound in restaurant and retail activity — at least at midweek. And Crain’s has chronicled the stories of restaurant operators who have braved the recent headwinds, opening to acclaim.

But this rebound in the making is just that — a recovery that’s fragile at best. With so much riding on Chicago’s reputation as a foodie capital of the world — and with so many people here whose livelihoods depend on restaurant jobs — now is a terrible time to roll out a wage hike that will hit restaurant operators hardest while potentially doing very little to help the workers Johnson and his allies have in mind.

How ‘buying back the block’ can transform neighborhoods

It began with an audacious idea between ve Black developers on Chicago’s South Side.

Purchase 12 vacant lots in West Woodlawn to “Buy Back the Block” of 6300 South Langley Avenue.

Just two years later, the idea became reality this March, with ve new apartment buildings now standing where once there was nothing but grass, debris, and not much else.

e project helped the developers grow their businesses, created dozens of jobs and produced much-needed a ordable housing.

More important, the builders hope the endeavor will create a ripple e ect for the neighborhood to attract more investment. is is the story that community devel-

oper DaJuan Robinson shared with Illinois legislators this spring that helped persuade them to overwhelmingly pass a bill to create thousands more opportunities to “buy back the block” by reforming the property tax sale system to incentivize investing in local communities instead of profiting investors.

With Gov. J.B. Pritzker’s signature, this measure promises to unleash investment in Black and Latinx neighborhoods with the highest rates of vacant or abandoned land. Cook County alone contains 50,000 vacant properties, mostly concentrated on the south and west sides of Chicago, and in the south suburbs.

e Chicago Community Trust was proud to convene the coalition that

helped to spotlight pioneers like DaJuan and unite forces like Cook County Treasurer Maria Pappas, Commissioner Bridget Gainer, the University of Chicago and a coalition of tax experts, municipalities across Illinois, a ordable housing advocates, and community developers to bring this bill to the point of enactment.

For decades, private tax sales have perpetuated the blight and disinvestment in communities that could least a ord it. Here’s how it has worked:

Each year, state law mandates the county conduct a tax sale to collect on delinquent payers. Private buyers — typically institutional investors like hedge funds — gulp up vacant properties and either hold them until their values mature or return their investment to the local county via a little-known loophole known as a “sale in error.”

is loophole has allowed tax buyers to

recoup a full refund on their investment plus interest paid by local governments (aka taxpayers), simply by claiming there was an error in their original purchase (for example, the home was constructed of stucco instead of brick, per the listing, or there was a $100 mowing lien prior to purchase).

Meanwhile, the abandoned properties recirculate through the tax sale system for years, sitting vacant and deteriorating to the detriment of neighboring residents and the community at large.

By signing this bill into law, the governor will fuel the transformative change needed to break this cycle, and the Trust will continue to support its many local, state and private partners who are doing the hard work of reclaiming abandoned properties, reversing blight and reinvesting in historically overlooked neighborhoods.

Andrea Sáenz is president and CEO of the Chicago Community Trust.

DANIEL BRADLEY/UNSPLASH

A Chicago-centric angel investor’s message to the new mayor

Dear Mayor Brandon Johnson: Congratulations on your recent election. Although I did not vote for you, you have my support as someone who loves our city and is actively investing in its future.

I am a “ rst-check” angel investor in Chicago-based startups, providing several million dollars of my own capital to companies at their earliest stages. ree-quarters of the 83 companies I have backed are led by underrepresented founders. I choose to focus on our local entrepreneurs because I understand the economic impact of concentrating my capital here, rather than in Silicon Valley or elsewhere.

My goal is to help our founders build successful businesses, while adding thousands

of jobs to the local economy.  Many of these homegrown entrepreneurs will become successful enough to create meaningful nancial outcomes for their families and employees, who may then reinvest their capital into new local startups, creating a local economic ywheel.

e pandemic has caused us all to ask ourselves big questions about where and how we work: “Why am I at this job?” “Do I enjoy what I do?” But there is one pervasive question I am hearing again and again from founders that is critical to Chicago’s future: “If I can work from anywhere now, why am I living here?”

is question is actively being asked by other business leaders, too, whether they already live here, such as CME Group CEO Terry

Du y, who just publicly shared his concerns, or those who might consider moving here.

More people will be asking themselves that question in response to proposals like those contained in “First We Get the Money,” or calls to defund public safety and ignore the scal peril facing our city.

Our entrepreneurs do not have to be here.

ey choose Chicago because it is an amazing city with award-winning restaurants, vibrant neighborhoods, world-class universities, robust infrastructure, gritty workers and a reasonable cost of living.

But we are at the precipice of a mass exodus of our best and brightest entrepreneurs and their employees. ese vital individuals increasingly are looking to set down roots

President/CEO KC Crain

Group publisher/executive editor Jim Kirk

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engagement Aly Brumback

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and social media Robert Garcia

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Mrs. G.D. Crain Jr. Chairman (1911-1996)

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elsewhere as they seek safer streets, lower taxes and better-functioning local government. Unless we become more competitive, our city is going to lose the very entrepreneurs we desperately need here.

If we lose them and the jobs they represent, while scaring o the CME Groups and prospective corporate entrants before they even sign leases, will our city be viable ve, 10, 20 years from now? Or will we succumb to the same rapid decline and deindustrialization Detroit experienced? We cannot let that happen.

CHRISTOPHER DEUTSCH

Founder of Lofty Ventures in Chicago and Lofty Angels, which helps people learn angel investing

Our is here to

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support yours.

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We know the roadblocks you’re up against. We help you break through them, with solid, practical, cost-efficient legal and business advice. From developing value-based care models to executing transactions to handling myriad compliance and certification matters. Giving you the confidence of having committed, experienced, healthcare-focused counsel on your side.

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PEOPLE ON THE MOVE

ACCOUNTING

BDO USA, LLP, Chicago

BDO USA, LLP has named Matthew Panzica Market Managing Partner of the rm’s Tax practice for the Upper Midwest market.  Panzica will be responsible for the leadership of the market including people, client service and operational performance. Panzica has spent his entire career with BDO, most recently serving as the leader of the Chicago tax practice and continues to serve a wide array of multi-national corporate clients.

BUSINESS SERVICES

Circana, Chicago

Circana, the world’s leading advisor on the complexity of consumer behavior, announced the appointment of Anne Bramman as chief nancial and growth of cer. As a member of Circana’s executive leadership team, she will lead both the nance and strategy teams, identifying new ways for the company to continue achieving sustainable growth. She is a seasoned executive with more than 30 years of experience in senior nancial roles at consumer branded companies, including Boston Consulting Group.

CONSTRUCTION

Northern Builders, Inc., Schiller Park Northern Builders, Inc. is pleased announce the promotion of Joshua R. Hudson to Director of Finance. In his new role, Josh will be responsible for the administration and implementation of various nancial initiatives including investment analyses, banking compliance, internal reporting, and cash management. Josh will also work closely with Northern’s development team in assessing and nancing new opportunities. Josh’s strong technical and communication skills are a valuable asset to Northern.

Thompson Coburn LLP, Chicago

Carlos A. Ortiz joined Thompson Coburn as a partner. He provides sophisticated counsel to employers in employment and immigration matters. His employment work involves I-9 compliance, plus handling claims of harassment, discrimination and wrongful termination, as well as matters under the ADA, ERISA, FLSA and OSHA. He also has extensive experience in consumer and class action nancial services litigation. Fluent in Spanish and active in the community, Carlos was born and raised in Chicago.

NON-PROFIT

Lee & Associates of Illinois, Rosemont

Industrial real estate veteran Frank Grif n has joined Lee & Associates of Illinois as Principal, specializing in supply chain and logistics. Grif n represents tenants, developers, owners and investors in the acquisition, disposition and leasing of property and land. He brings more than 30 years of commercial real estate brokerage experience in the Chicago area to Lee & Associates, one of largest national commercial real estate providers in North America.

ACCOUNTING

BDO USA, LLP, Chicago

BDO USA, LLP has named Dale Jordan the Tax Market Leader of the rm’s Chicago Upper Midwest practice where he now oversees all client development and go-to-market strategies throughout the market. In addition, he leads BDO’s National Manufacturing Tax Practice. With over 20 years of experience identifying and executing tax saving strategies, Jordan has served a variety of clients, including partnerships, privately held and publicly traded companies.

CONSULTING

STS - Strategic Talent Solutions, Chicago

Ronald McDonald House Charities® of Chicagoland & Northwest Indiana (RMHC-CNI), Chicago

REAL ESTATE

Lee & Associates of Illinois, Rosemont

ACCOUNTING

BDO USA, LLP, Chicago

BDO USA, LLP has named Darin Kempke Assurance Market Leader of the rm’s Chicago of ce. Kempke will oversee client development and goto-market strategies throughout Chicago and the region, aligning with the rm’s strategic business objectives. With over 32 years of experience, Kempke has deep SEC and private company experience, including hundreds of IPO and public nancing transactions involving the issuance of public equity and debt securities, SEC lings and multinational M&A deals.

CONSTRUCTION

J.C. Anderson, Chicago

J.C. Anderson, a leading Chicagoland General Contractor specializing in interiors, is pleased to announce that the company has promoted Joe Maguire to Chief Executive Of cer and John Angelovich to President. Angelovich brings 25 years and Maguire brings 21 years of experience to the company. Together they will lead JCA’s collaborative project management teams, ensuring client satisfaction and exceeding expectations throughout the construction process. Combining JCA’s 144 years of experience with youthful talent, they will continue the company’s pursuit of exciting projects and focus on company growth, innovation, diversi cation and talent development.

Maguire Angelovich

Strategic Talent Solutions (STS) is pleased to welcome Brian Wellman to our team. Previously with YSC Consulting, Brian joins STS as a Partner and brings nearly 25 years of experience working with CEOs and other senior executives across a diverse set of corporate and private equity companies. He draws on his expertise in leadership assessment, coaching, top team dynamics, and succession planning to promote the growth and high performance of executives and the organizations they lead.

Ronald McDonald House Charities® of Chicagoland & Northwest Indiana (RMHC-CNI) has welcomed Tim Kennedy as the new Chief Development Of cer. Kennedy will be responsible for development efforts and growing the organization’s revenue streams through strategic donor relationships, event fundraising, corporate partnerships and foundation grants. Most recently, Kennedy served as the Chief Advancement Of cer at the Daniel Murphy Scholarship Fund and prior to this spent 15 years with RMHC Global.

REAL ESTATE

Advocate Commercial Real Estate Advisors, Chicago

EDUCATION

TCS Education System, Chicago

ARCHITECTURE / CONSTRUCTION

Valerio Dewalt Train, Chicago

Valerio Dewalt Train (VDT) has named Heather Salisbury, AIA, CSI, LEED AP BD+C, Director of Operations. As Director of Operations, Salisbury will improve and monitor quality and production standards for the rm’s projects. Her projects include Art on THE MART in Chicago, IL; Northwestern Mutual Headquarters in Milwaukee, WI; and multiple eBay of ces around the country, among others. She is currently overseeing the 696-unit Graduate Student Housing for Vanderbilt University in Nashville, TN.

CONSTRUCTION

Mid-America Carpenters Regional Council, Chicago

Gary Perinar, Executive Secretary-Treasurer of the Mid-America Carpenters Regional Council, was awarded Labor Leader of the Year by the Chicago and Western Lakes Port Council of the AFL-CIO Maritime Trades Department. Perinar, who oversees 52,000 union carpenters and millwrights in Illinois, Missouri, Kansas and eastern Iowa as head of the Mid-America Carpenters Union, was recognized for his work to help secure funding for port and waterways infrastructure and create thousands of union jobs.

TCS Education System, an integrated nonpro t system of six colleges and universities, has appointed Brian Powell Chief Human Resources Of cer. Powell brings over 20 years of experience leading HR at nonpro ts and higher education institutions. At TCS, he will guide policy decisions, support DEI initiatives, and advise on employee development. He holds a B.A. in American History and Psychology and a law degree with a concentration in Labor and Employment Law from Northern Kentucky University.

FINANCIAL SERVICES

LGIM America, Chicago

LGIM America (LGIMA) is pleased to announce that Helen Garrahy has joined the rm as the Director of Asset Management within the US Real Estate Equity team. In this role, she is responsible for providing oversight to speci c real estate assets including, but not limited to, the rm’s long lease, multifamily, industrial and build to rent strategies. Helen brings nearly 30 years of real estate investment management experience to LGIM America.

Joel Hoffman joined Advocate as Chief Operating Of cer and will be based in their Chicago of ce.  With over twenty years of experience in the industry, Joel will oversee the corporate and brokerage infrastructure, strategic planning, and direct ongoing company expansion. Prior to joining Advocate, Joel spent approximately 20 years with Cushman & Wake eld where he most recently served as the Global Head of Operations for the Research division.

REAL ESTATE

Molto Properties, Oakbrook Terrace

Molto Properties promotes Anthony Cincinelli to Executive Vice President of Construction and Development. In this new role, Cincinelli will assume broader responsibility, including managing a team that oversees all development projects across the country. With his extensive knowledge and experience in construction and development, the Molto Executive Team is con dent that Cincinelli will excel in his new position and make signi cant contributions to the growth and success of the company.

Lee & Associates of Illinois has welcomed the industrial real estate brokerage team of Jeff Provenza as Principal and Sam Lepore as Senior Associate. The duo brings 16 years of experience representing a diverse group of clients in their brokerage and real estate advisory needs. Provenza’s specializations include the disposition, acquisition, and leasing of industrial property, tenant representation for national and Chicagobased companies, as well as special assets advisory. Lepore specializes in industrial real estate brokerage in Chicago’s O’Hare submarket. He offers a full range of brokerage services including tenant representation, buyer representation, owner representation and sale/leasebacks.

REAL ESTATE

Lee & Associates of Illinois, Rosemont

Todd Hendricks has joined Lee & Associates of Illinois as Senior Vice President. Hendricks specializes in sophisticated location analysis and last mile supply chain solutions for the trucking, distribution and manufacturing sectors. Hendricks has a 20-year career in transportation, 3PL brokerage and industrial real estate. He provides occupiers, investors and developers with nationwide brokerage services for the acquisition, disposition, and leasing of properties and land sites.

To order frames or plaques of profiles contact Lauren Melesio at lmelesio@crain.com or 212-210-0707

Provenza Lepore

Entrepreneur Shital Daftari was selling shoes and clothing online when COVID-19 rst began to spread through China. Instantly seeing a need, by January 2020 Daftari had pivoted to selling the next big accessory: face masks. roughout the pandemic, she went on to sell hard-to-source personal protective equipment as well as 50 million COVID testing kits. is decision catapulted her business, SNT Biotech, to a growth rate of 1,188.5% since 2017.

Daftari’s is just one of the companies making Crain’s Chicago Business’ Fast 50 2023 — and it’s an impressive list. is year’s winners saw ve-year median revenue growth of a staggering 793%, up from 593% in last year’s edition, and an average revenue increase of 5,752%, driven by the enormous growers topping our list.

With 23 companies not featured in last year’s ranking, Crain’s 2023 Fast 50 is a testament to the continued strength of Chicago’s small and midsize businesses.

Many of these companies were impacted by COVID and its aftermath. Several were radically changed — for the better. Concert promoter Cardenas Marketing Network (No. 47, with over 350% ve-year growth) saw a surge in revenue thanks to pent-up demand for live music after pandemic restrictions were lifted.

e 57-employee company made $390 million in revenue last year.

In general, logistics, tech and nancial service companies tend to top the list. ere are 11 logistics companies among this year’s Fast 50, of which four — Unilogic, Setna iO, OSM Worldwide and OTR Transportation — weren’t on last year’s list.

And like last year, Chicago’s leading cannabis players all made the top 10, thanks in part to expansion into new states.

Read on for our full ranking of Chicago’s fastest-growing companies and exclusive pro les on all 50.

Missed your chance to apply for Crain’s 2023 Fast 50? To ensure your company submits on time next year, contact Crain’s data and research analyst Sophie Rodgers (sophie.rodgers@crain.com).

METHODOLOGY:

Working with accounting firm Plante Moran, we had the following ground rules for choosing the finalists in our latest ranking of the area’s fastest-growing companies:

w We only considered companies

1. M1

5-year growth: 70,978.1%

Company description: Digital private finance service

Location: Chicago

Year founded: 2015

2022 revenue: $32.9 million

Local employees: 172

Total employees: 269

Profitable? No

M1 aims to make it easier to build

headquartered in the seven-county Chicago area, founded on or before Dec. 31, 2016.

w We excluded franchisees, regulated banks, utilities, real estate developers, real estate investment

wealth, even for customers with a modest nest egg. e private digital bank makes high-yield investing and wealth management accessible and appealing to everyday individuals, particularly those who expect an intuitive mobile experience. eirs is a lofty endeavor. Centuryold nancial titans dominate the industry — which, at this moment, is rife with volatility. But M1 views

trusts and some holding companies (such as those that primarily buy or sell other companies/large assets).

w Small companies (those reporting less than $15 million in 2022 revenue) were likewise not considered.

its newbie status as a positive. In fact, its lack of entrenched processes has made it easier to build products that o er “hyperpersonalization, hyper-automation, interactivity and thoughtful design to create a nancial adviser in your phone,” says M1 founder and CEO Brian Barnes.

Also crucial to M1’s rapid growth: a 5% annual percentage

w Lastly, we disqualified companies that had more than one drop in revenue from 2017 to 2022.

Plante Moran examined financial documents provided by the applicants for years 2017 to 2022.

yield savings account for paid members. “ is bucks the trend of the last decade or so of banks giving their customers near-zero interest on their deposits,” says Barnes. e industry-leading return is possible thanks to a partnership between M1 and B2 Bank, a Minnesota-based institution Barnes purchased in 2021.

— Julia Edelstein

Chicago’s fastest-growing companies: With 22 new rms in the ranking, Crain’s latest Fast 50 is a testament to the continued strength of Chicago’s small and midsize businesses.

BY SOPHIE RODGERS

Brian Barnes is founder and CEO of M1.

JOHN R. BOEHM

Research: Plante Moran and Sophie Rodgers. Editors: Rock Top Media, Jan Parr and Ann R. Weiler. Design and web development: Karen Freese Zane. Copy editor: Danielle Narcissé.

2. Tegus

5-year growth: 42,566.0%

Company description: Financial investment research

Location: Chicago

Year founded: 2015

2022 revenue: $67.2 million

Local employees: 286

Total employees: 595

Profitable? No

Establishing a company as a resource for nancial advice is challenging in any climate. But in today’s in- ux nancial world, when investors’ priorities may change day to day or even hour to hour, it’s Herculean. Yet over the past two years, Tegus, a research platform for investors, has expanded well beyond its initial customer base — American investors with a tech bent — to reach hundreds of investment banks and private-equity and venture-capital rms. With two new products — BAMSEC, for fundamental research, and Tegus Models, for nancial data — Tegus has honed a “maniacal focus” on delivering for customers, explains Chief Financial O cer Bob Casey.

“Co-CEOs Michael and omas Elnick prioritize engaging with our customers every week to gain feedback and understand their pain points. . . . ey then openly share this feedback with leaders and employees,” says Casey, who calls this practice a “deep level of accountability” designed “to ensure our customers succeed.” Tegus more than doubled its headcount in the last ve years, and clients include Redpoint Ventures, rive Capital and Spark Capital. —

Julia Edelstein

3. Songfinch

5-year growth: 36,908.2%

Company description: Personalized music creation

Location: Chicago

Year founded: 2016

2022 revenue: $35.2 million

Local employees: 55

Total employees: 75

Profitable? No

How do you create a new and pro table music product in an era when listeners can play any song at any time? For the four co-founders of Song nch, the secret was turning customers into creators. Post-pandemic, says CEO and co-founder John Williamson, they noticed a “growing shift in consumer desire to become active participants, rather than just passive fans.” Songnch enables anyone to create a custom song for themselves or a loved one through its vast artist network and platform.

Along the way, it’s generated a new, viable income source for thousands of independent artists. Backed by high-pro le private investors including Quincy Jones, Abel “ e Weeknd” Tesfaye and Amala “Doja Cat” Dlamini, Songnch may be on track to dominate

7. Verano

5-year growth: 7,678.7%

Company description: Cannabis

company

Location: Chicago

Year founded: 2014

2022 revenue: $879.4 million

Local employees: 424

Total employees: 3,730  Profitable? Yes

Cannabis company Verano made its debut on the Fast 50 list last year with acquisitions at the forefront of its growth. is year, the company makes the list due to its expansion from medical marijuana to recreational use in New Jersey and Connecticut. “We’ve successfully gone through changeovers from medical to adult-use programs over the course of the last year,” says Verano President Darren Weiss, “which has been really exciting.”

ees.” Staying competitive in the unpredictable world of logistics can be stressful, but Lopatkina takes pleasure in the high-volume industry. As a native Ukrainian, she says her other full-time job is advocating for her home country; Nortia Logistics has introduced numerous Ukrainian manufacturers and companies to the U.S. market. — Corli Jay

6. CoinFlip

5-year growth: 15,514.3%

In the increasingly bustling business of cannabis, Verano welcomes competition. In fact, company leadership sees a healthy marketplace as integral to company growth — an incentive “to get better, be creative and stay innovative.”

Weiss says Verano continues to thrive even as it shifts focus to community impact. In addition to providing a wide range of cannabis products, Verano commits to social justice initiatives by partnering with Mission Green, an organization that seeks to provide nancial help to those serving sentences for cannabis-related crimes. — Corli Jay

the custom music category the way Cameo has owned celebrity shoutouts. Williamson likens Song nch to Iron Man’s suit, calling it technology that can give rise to “an incredibly powerful superhero that is able to achieve something that has eluded the majority of artists: a career in music.” —

Julia Edelstein

4. Meitheal Pharmaceuticals

5-year growth: 36,567.6%

Company description: Generic pharmaceuticals and fertility distribution

Location: Chicago

Year founded: 2016

2022 revenue: $174.9 million

Local employees: 62

Total employees: 71

Profitable? Yes

e steady climb of Meitheal Pharmaceuticals is due in part to its parent company, China-based manufacturer NKF, says Victoria Wohlfeil, the pharma rm’s general counsel and corporate secretary. “ e fact that we have our own manufacturing in China is very bene cial,” she says, “because it lets us reduce the cost as much as possible.” Launched in 2017, Meitheal got the attention of NKF two years later and has witnessed enormous growth since combining forces. e company focuses on distributing generic injectables to its wholesalers to provide a ordable options to

patients, and reliable manufacturing has been integral in its ability to acquire new contracts. Meitheal says its growth has also been driven by its ability to get new products approved and to market quickly and by expanding its product base. For 2023, Meitheal is projecting $270 million in revenue and a net margin of $67.5 million, and expects to launch 24 new products this year.

—

Corli Jay

5. Nortia Logistics

5-year growth: 21,139.8%

Company description: Logistics

Location: Franklin Park

Year founded: 2012

2022 revenue: $52.6 million

Local employees: 80

Total employees: 105  Profitable? Yes

An alum of Crain’s 2022 Fast 50 list, Nortia Logistics has seen new growth due to an increase in its eet, customer acquisition and a recent rebrand. “We are in the process of repositioning ourselves more with our direct customers,” says President Ellen Lopatkina. In doing so, Lopatkina says she hopes to make clients feel condent in the company’s ability to carry out even the most challenging contracts. Juggling an extraordinarily di cult few years for logistics, Lopatkina has witnessed many companies collapse. Nortia Logistics sees the fallo s as “an opportunity to scoop up inexpensive assets and quality employ-

Company description: Cryptocurrency tech

Location: Chicago

Year founded: 2014  2022 revenue: $131.3 million

Local employees: 205

Total employees: 265  Profitable? Yes

CoinFlip has become a recurring name on our Fast 50, topping the list two years in a row, and seems likely to continue expanding its global presence. e cryptocurrency ATM operator now has more than 4,000 kiosks across the U.S., 1,000 more abroad and a new Crypto Experience Center in Tampa, Fla. What is a Crypto Experience Center? CoinFlip CEO Ben Weiss likens it to the Genius Bar at an Apple Store, where experts are on call to explain the complex world of crypto to laypeople. Focused on consumer education, it o ers free resources about the crypto market and is a concept CoinFlip is considering replicating around the world.

Expanding its presence in Florida has created a centralized hub for the business, while opening o ces in Australia has helped drive revenue. Weiss predicts that in 2023, CoinFlip’s earnings will reach $200 million, and he credits the company’s success to its knowledgeable and rapidly growing sta . “ is period taught me the importance of building winning teams,” he says. “It’s not so much about what you can do, but it’s about what your team can do.” —

Corli Jay

8. Cresco Labs

5-year growth: 7,573.3%

Company description: Cannabis operator

Location: Chicago

Year founded: 2013

2022 revenue: $842.7 million

Local employees: 722

Total employees: 3,014

Profitable? No

e cannabis industry continues to surge — a fact that Cresco Labs has witnessed rsthand. Initially launched in 2013 as a purveyor of medical marijuana, the company has shrewdly ridden the cultural wave toward recreational use and pivoted to providing cannabis products via 64 dispensaries nationwide. “Our continued growth can be attributed, in large part, to medical markets transitioning to adult-use markets,” says CEO and co-founder Charlie Bachtell.

Last year, Cresco Labs notched record sales of $843 million due to a “relentless focus on wholesale brands and distribution,” Bachtell says. e company not only has a hearty retail presence in its Sunnyside stores, but also a strong wholesale presence that allows it to put its branded products in dispensaries owned by others. All of which has led Cresco Labs “to being the No. 1-selling portfolio of branded cannabis products in the entire industry for the second year in a row,” Bachtell says. —

Katie Arnold-Ratli

Cresco Labs, launched in 2013 as a purveyor of medical marijuana, has ridden the cultural wave toward recreational use.

Meitheal Pharmaceuticals focuses on distributing generic injectable medications.

JOHN R. BOEHM

MEITHEAL PHARMACEUTICALS

9. Green Thumb Industries

5-year growth: 6,055.1%

Company description: Cannabis consumer-packaged goods and retailer

Location: Chicago

Year founded: 2014

2022 revenue: $1 billion

Local employees: 1,454

Total employees: 4,000

Profitable? Yes

A player in the cannabis industry since 2014, Green umb Industries chalks up its success up to diversi cation. Home to a family of brands that specialize in everything from cannabis pastilles to pre-rolls meant to be enjoyed while walking the dog, Green umb Industries knows the importance of innovative products. “ rough research and development, we have successfully introduced new and innovative o erings that resonate with our customers and build loyalty across our family of brands,” says CEO, Chairman and founder Ben Kovler.

With dispensaries across the U.S., Green umb Industries’ footprint continues to grow. e company’s Rise Dispensaries now total nearly 80 locations in 14 U.S. markets. And while Green umb Industries is best known for its colorfully named cannabis products, it’s also focused on “cash generation and maintaining a strong balance sheet” since day one to weather any industry challenges, Kovler says. — Katie Arnold-Ratli

10. Bloq

5-year growth: 5,002.2%

Company description: Blockchain technology

Location: Chicago

Year founded: 2015

2022 revenue: $30.4 million

Local employees: 12

Total employees: 38 Profitable? No

Amid the rise of unprecedented tech innovations — cryptocurrency, NFTs, the metaverse — few companies have had the foresight to identify key technology needs and trends and deploy solutions to address them. But that’s precisely the purview of Bloq, a solutions company that delivers pioneering platforms in the blockchain, decentralized nance and cryptocurrency space.

Bloq Chairman and co-founder Matthew Roszak believes this penchant for forward thinking is the secret to the eight-year-old company’s success. “We anticipated the need for a well-audited DeFi yield aggregator, and so we launched Vesper,” he says. “We saw that the computing power for Bitcoin mining should be easily tradeable, so we launched Lumerin.”

It tracks that Bloq would be well-positioned to re ne emerging innovations, considering that

company leaders like to keep their ngers in numerous tech-related pies. “It’s very rare to nd any other company that is working on all of the most compelling aspects of Web3,” Roszak says, “and, more generally, the infrastructure and applications that make it a compelling space.” — Katie

Arnold-Ratli

11. Uturn Data Solutions

5-year growth: 3,315.3%

Company description: Cloud and data consultancy

Location: Chicago

Year founded: 2014

2022 revenue: $16.8 million

Local employees: 15

Total employees: 22

Profitable? Yes

For this cloud and data consulting rm, success boils down to expertise and experience, according to founder and Managing Partner Adam Dillman. e seasoned team’s strategic decision to focus on cloud adoption and modernization has been a boon for business, leading to seven new hires in 2022. Up next, Uturn Data Solutions will continue to expand its roster of talented engineers and cloud architects, who Dillman says have been instrumental to the company’s growth. —

Abigail Covington

12.

Inspire11

5-year growth: 2,791.3%

Company description: Full-service consulting firm

Location: Chicago

Year founded: 2016

2022 revenue: $62.6 million

Local employees: 205

Total employees: 257

Profitable? Yes

As a full-service global consulting rm, Inspire11 knows a thing or two about running a great business — and it shows. e compa-

15. ShipBob

5-year growth: 2,173.5%

Company description: Omnichannel fulfillment platform

Location: Chicago

Year founded: 2014

2022 revenue: $355.4 million

Local employees: 223

Total employees: 900

Profitable? No

ny has been certi ed by the Great Place to Work Institute two years in a row and was recently included on Built In’s “Best Places to Work” list — as well as making Crain’s own recent list. Little wonder, then, that founder and CEO Alban Mehmeti cites the rm’s investment in its people as one of the main drivers of its success — with delivering excellent results for clients ranking as a close second. — Abigail

Covington

13. Mugsy

5-year growth: 2,558.3%

Company description: Men’s clothing brand

Location: Chicago

Year founded: 2016

2022 revenue: $18 million

Local employees: 7

Total employees: 12

Profitable? Yes

Sometimes a great product is all it takes. Such is the case for men’s clothing brand Mugsy, which founder and CEO Leo Tropeano launched in 2015 after struggling to nd a pair of stylish yet comfortable jeans. Mugsy’s signature super-stretch denim fabric has since attracted more than 200,000 customers, allowing the brand to expand into other areas of apparel and open multiple retail locations.

e secret to Mugsy’s success is simple, says Chief Operating O cer Scott Dulany, who calls it “plain old customer and sales growth.”— Abigail Covington

14. Highdive

5-year growth: 2,483.1%

Company description: Full-service ad agency

Location: Chicago

Year founded: 2016

2022 revenue: $25.6 million

Local employees: 82

Total employees: 90

Profitable? Yes

e last year could not have gone better for this independently owned ad agency, which netted nine new clients, including Jeep and Lay’s; became the NHL’s agency of record; and made Ad Age’s list of agency standouts and topped USA Today’s Super Bowl Ad Meter for the third year in a row. Managing Partner Megan Lally attributes the agency’s success to client relationships built on trust and a shared goal of creating powerful work, like the agency’s Super Bowl spot for Rocket Mortgage, which starred Anna Kendrick as a savvy real estate pro helping Barbie nd her new dream home.— Abigail Covington

E-commerce was not the ubiquitous industry it is today back when Divey Gulati and Dhruv Saxena started ShipBob in 2014. But the intervening years have given the co-founders time to perfect the complicated logistics of running an omnichannel ful llment platform — which they mastered just in time for the e-commerce boom. Fast-forward to today, and ShipBob now serves 5,000 customers through its network of 26 ful llment centers across ve countries. — Abigail Covington

16. Unilogic

5-year growth: 1,994.7%

Company description: Supply chain solutions

Location: Franklin Park

Year founded: 2016

2022 revenue: $17.3 million

Local employees: 62

Total employees: 62

Profitable? Yes

As a logistics solutions company, Unilogic prides itself on the multitude of services it provides its clients — which they refer to as partners. A one-stop shop that manages shipping, cross-docking, storage and more, Unilogic streamlines the supply chain process from locations in Franklin Park, Woodridge, Bedford Park and near Midway Airport. Company brass credits Unilogic’s growth to an increase in warehouse space this year, from 74,000 square feet to more than 1 million square feet across its ve facilities. — Corli Jay

Mugsy has expanded into new areas of apparel and opened multiple retail locations.

ShipBob serves 5,000 customers through its network of 26 ful llment centers.

SHIPBOB

MUGSY

2211 N. Elston Ave., Suite 302, Chicago, IL 60614

773-902-5296

acceldevgroup.com

Public Projects Power Growth at Accel Construction

The depths of a steep recession may not seem like the most opportune time to launch a construction company, but that’s exactly what Henry Lopez did in 2008 when he founded Accel Construction. “It was time,” Lopez says.

He had already worked at big real estate and construction rms in Chicago but dreamed of one day having his own company. “I’ve always had an entrepreneurial drive,” he says.

at drive has propelled Accel Construction to become one of Chicago’s fastest growing companies. Accel is a general contracting company that focuses on public sector work, handling projects from $2 million to $35 million. Revenues are projected to hit $50 million in 2023, a 40% jump from last year. e company has grown from its original team of three to 35 employees.

“I was born and raised in Chicago,” Lopez says. “I love this town. Putting our name on projects that will remain a xture here for a long time is amazing.”

As a minority-owned rm, Accel participated in the SBA 8(a) business development program that has helped to fuel its federal contracting work. e company leveraged that experience to break into aviation construction, including recent projects at O’Hare and other airports.

Accel is growing its private sector work too. e company will be breaking ground on a vestory building at 1319 S. Ashland Ave. in Chicago, a mixed-use project intended for nonpro t tenants. e entire development, design and construction team is comprised of Hispanic-owned rms. “We’re very proud of that,” Lopez says.

Pivot to pro t

Accel is a nimble player, adjusting to market realities along the way. e company initially started as a real estate development services rm, representing the owners of major construction projects for a fee.

As private sector development work dried up during the Great Recession, Accel pivoted to o er general contracting services in the public sector where there were more opportunities. “We were able to weather the storm during that period and come out strong,” Lopez says.

e company’s big break came in 2011. Accel partnered with another small business experienced in federal contracting to manage a $13 million project for the U.S. Army Corps of Engineers. e project involved the renovation and expansion of the Army Reserve Center in Homewood, Illinois. “It opened the door to more federal projects,” Lopez says.

Knowing how to manage government projects has been key to the company’s success. While other contractors might shy away from public work because of the complexity, Accel has leveraged its expertise to grow that part of its business.

Professionalism and teamwork

Lopez started his career out of college working at big design and construction companies. He characterizes Accel as a rm that o ers the professionalism of a big company with the personal attention of a small rm.

Collins Whit eld echoes that sentiment. With a background in private sector construction, Whit eld is vice president at Accel and runs operations. “We treat our public sector project clients like we would private sector clients,” he says.

Teamwork is a priority at Accel. Five or six employees are typically assigned to a project. Collins likes building morale and keeping the team excited about projects, which can last a year or more. “We have a team atmosphere,” he says. “No one is alone.” Collins gures he spends about half his time mentoring team members. “It’s my favorite thing,” he says.

Lopez prioritizes mentoring too, which extends to other minority-owned rms. “Mentoring is part of my management style,” Lopez says. “One person cannot do it all.”

He re ects on the time when he worked for e John Buck Company, a prominent Chicagobased real estate rm. Owner John Buck said not to be afraid or intimidated to hire people you may feel are smarter than you. “It’s wise advice,” Lopez says. “It’s a great thrill to see the people we hire succeed.”

Looking ahead, Lopez doesn’t have a target revenue goal in mind, but rather expects solid, stable growth in the years to come. “We have carefully managed our growth so as not to overextend ourselves,” he says.

He admits it’s a challenging time. e construction market is still su ering the e ects of supply chain issues, and in ation eats into pro ts. But he’s optimistic. “We’ve had tremendous growth over the last 4-5 years,” he says. “I want to build on that. We have a great group of people and even more room to grow.”

One of Accel Construction’s airport projects included infrastructure changes to accommodate temporary passenger boarding bridges necessary for the expansion of O’Hare’s International Terminal.

Accel also led the complete renovation and expansion of the main TSA checkpoint at O’Hare’s International Terminal, expanding the area from 8,500 to 18,000 square feet.

Henry Lopez, Founder, Accel Construction

17. RHM Staffing Solutions

5-year growth: 1,625.7%

Company description: Staffing services

Location: Oak Brook

Year founded: 2015

2022 revenue: $88.6 million

Local employees: 140

Total employees: 200

Profitable? Yes

anks to a booming interest in contract work since the pandemic, RHM Sta ng Solutions has continued to see growth. e company provides workers for Midwest manufacturing and engineering companies, placing employees in contract, contract-to-hire and permanent positions. Given the benets that contract work provides — increased exibility, an opportunity for networking and competitive wages — RHM Sta ng Solutions is likely to remain a top contender in this thriving market. —

Corli Jay

18. Double Good

5-year growth: 1,406.0%

Company description: Virtual

fundraising

Location: Burr Ridge

Year founded: 1998

2022 revenue: $178 million

Local employees: 215

Total employees: 231

Profitable? Yes

Pivoting to a virtual model has boosted business for Double Good, which focuses on online popcorn fundraising. e company, founded in 1998, has replaced the traditional paper-and-cash fundraising model with an app to simplify the experience for both sellers and buyers. When the pandemic brought in-person fundraising to a halt, Double Good became a digital trailblazer, pivoting to a fully online platform well ahead of the competition. — Corli

Jay

19. Redmond Construction

5-year growth: 1,232.4%

Company description: Commercial general contractor

Location: Chicago

Year founded: 2013

2022 revenue: $61.7 million

Local employees: 41

HACIA ADVANCES DIVERSITY

Total employees: 42 Profitable? Yes

In just the rst quarter of 2023, Redmond Construction had already completed big projects for construction engineering company TYLin International Group and built a new o ce in Downers Grove for UGN Automotive. Last year, the company won its largest tenant interior buildout project for logistics company MoLo Solu-

OVER 350 HACIA Members

67%

tions. Redmond Construction’s rapid growth is partly attributed to its development in the vibrant Fulton Market District, as well as an increase in o ce leasing. is marks Redmond Construction’s third time landing on Crain’s Fast 50 list. — Corli Jay

20. XSell Technologies

5-year growth: 1,227.1%

Company description: Customer experience software

Location: Chicago

Year founded: 2014

2022 revenue: $22.6 million

Local employees: 74

Total employees: 125

Profitable? No

60%

XSell Technologies, which uses AI to help companies answer questions and improve agent performance, has been riding the AI wave since 2014. Having recently signed new contracts, as well as contract expansions, with Fortune 100, Fortune 50 and Fortune 25 companies, XSell continues to expand its reach. Its in-house numbers tell a compelling story of lifts in conversion rates for customers as well as reduction in average handle time. XSell Technologies became a partner with customer experience platform provider NICE in March — a major move, considering NICE is an industry leader in customer experience software. — Corli

Jay

21. SNT Biotech

5-year growth: 1,188.5%

Company description: Medical supply distributor

Location: Naperville

Year founded: 2011

2022 revenue: $16 million

Local employees: 13

Total employees: 20

Profitable? Yes

is Naperville-based medical supply distributor is living proof that it’s never too late to change your business model. ough SNT Biotech was founded in 2014 as an apparel and fashion business,

it pivoted to selling COVID testing kits, PPE and medical supplies during the pandemic. e company continued to see growth in 2022 as it positioned itself as a large distributor to labs and hospitals, o ering more products and increasing its customer base.

— Corli Jay

22. Simplify Healthcare

5-year growth: 1,026.9%

Company description: Health plan technology solutions for payers

Location: Aurora

Year founded: 2008

2022 revenue: $46 million

Local employees: 143

Total employees: 740

Profitable? Yes

e market conditions were right for Simplify Healthcare’s stunning 1,027% organic growth of the past ve years. A provider of health care solutions to health insurance plans, the rm bene ted from insurance companies’ need to automate administrative tasks long performed manually in order to keep pace with regulatory requirements and to initiate claims reviews. —

Katie Arnold-Ratli

23. Setna iO

5-year growth: 1,022.4%

Company description: Aircraft parts supplier

Location: Chicago

Year founded: 2016

2022 revenue: $141.6 million

Local employees: 40

Total employees: 85

Profitable? Yes

Supplying commercial, regional and business aircraft with spare parts both new and used, Setna iO maintains o ces around the world with facilities placed strategically close to Chicago- and London-area airports. CEO David Chaimovitz credits the company’s pro table strategy, its “nose to tail” servicing capabilities and a hardworking team for its recent organic growth of more than 1,000%. — Katie

Arnold-Ratli

Since our formation in 1979, HACIA has created sustainable change among Illinois’ diverse construction leaders with equitable opportunities,creating generational wealth and transformingcommunities.

Redmond Construction is an interior general contractor specializing in commercial tenant improvement and landlord redevelopment projects.

REDMOND CONSTRUCTION

24. Hyde Park Hospitality

5-year growth: 929.8%

Company description: Airport concessions services and foodservice management

Location: Chicago

Year founded: 2012

2022 revenue: $19.8 million

Local employees: 225

Total employees: 550

Profitable? Yes

Hyde Park Hospitality’s diverse services range from provider of airport concessions and lounge operations to food and facilities management services. In addition to making travelers’ days easier and more comfortable, the 11-year-old company brings dining services to schools and corporate cafeterias, including the Chicago Public Schools system. Recently, it added a marquee name to its roster of food-service clients: Meta (formerly known as Facebook). is feather in the company cap has boosted its pro le and pro ts alike. — Katie Arnold-Ratli

25. First Stop Health

5-year growth: 828.2%

Company description: Virtual health care provider

Location: Chicago

Year founded: 2013

2022 revenue: $19.7 million

Local employees: 30

Total employees: 75

Profitable? No

Few industries have seen such a meteoric rise in ubiquity in recent years than telehealth, and First Stop has embraced the new normal to excellent e ect. O ering various takes on the telehealth experience, including virtual urgent care, the company unveiled new products: virtual mental health in 2020 and virtual primary care in 2022. According to CEO Teira Gunlock, it’s exactly this variety of o erings that has led to growth with both existing and new clients in the last few years. —

Katie Arnold-Ratli

26. Supernova Technology

5-year growth: 757.3%

Company description: Financial technology platform

Location: Chicago

Year founded: 2014

2022 revenue: $26.1 million

Local employees: 77

Total employees: 86

Profitable? Yes

Bringing wealth management and investment advising to the digital space since 2014, Supernova Technology is a full-service securities-based lending platform suitable for the nancial industry, from brokers to banks. e company’s mission is to democratize securities-based lending

by making it more accessible to a wider range of investors through its customizable, end-to-end software. Supernova Technology saw a record year of growth last year, due in part to launching the fth iteration of its software. —

Katie Arnold-Ratli

27. The Mather Group

5-year growth: 650.4%

Company description: Registered investment adviser

Location: Chicago

Year founded: 2011

2022 revenue: $52.6 million

Local employees: 68

Total employees: 151

Profitable? Yes

Focused on helping high-networth individuals invest to reach their retirement goals, e Mather Group is also keeping a close eye on potential growth opportunities. Last year, the company spearheaded seven new acquisitions — bringing its tally to 17 acquisitions since 2019, with more M&A possibilities still in its sights. Company leadership also attributes the rm’s success to a “robust lead generation engine that supports organic growth,” expanding its client base and assets rapidly within the last ve years. —

Katie Arnold-Ratli

Marc Brooks, center, president and CEO of Hyde Park Hospitality, and the management team. HYDE PARK HOSPITALITY

28. Ballyhoo Hospitality

5-year growth: 582.7%

Company description: Hospitality restaurant group

Location: Chicago

Year founded: 2009

2022 revenue: $46 million

Local employees: 95

Total employees: 95

Profitable? Yes

With its nine highly versatile restaurant properties in the Chicago area, Ballyhoo Hospitality has made its mark on the neighborhood dining experience. e organization’s deeply considered concepts and strong brand identities have resulted in healthy yearover-year pro ts at its locations. In 2022, the group added two new restaurants, Buck Russell’s in Wilmette and Sophia Steak in Lake Forest. e result? A more than $3 million jump in revenue. — Katie

Arnold-Ratli

29. OTR Transportation

5-year growth: 553.4%

Company description: Freight brokerage services

Location: Chicago

Year founded: 2015

2022 revenue: $131.6 million

Local employees: 57

Total employees: 61

Profitable? Yes

With expertise in nding freight hauling for a wide array of industries — including automotive, aerospace, food, packaging and industrial — it’s safe to say OTR Transportation can arrange for just about anything to be moved from point A to point B. Using proprietary management software, the rm orchestrates a vast network of freight carriers to execute customer needs. Last year brought a private-equity investment in the company, strengthening its position considerably. — Katie

Arnold-Ratli

30. Wavicle Data Solutions

5-year growth: 553.2%

Company description: Data solutions and analytics consulting

Location: Oak Brook

Year founded: 2013

2022 revenue: $42.9 million

Local employees: 103

Total employees: 482

Profitable? Yes

O ering consultation services to businesses in need of quick but

detailed data analysis, Wavicle Data Solutions specializes in turning an unruly rehose of information into tidy visualizations and actionable insights that help organizations move data-oriented projects along at greater speed. In recent years, the company supercharged pro ts by making key new leadership hires and tasking them with ramping up client acquisition. In 2022, the company saw a 50% leap in year-over-year team growth and a 41% jump in revenue

growth, fueled by a demand for cloud migration and engineering.

— Katie Arnold-Ratli

31. Alera Group

5-year growth: 551.4%

Company description: Insurance brokerage

Location: Deerfield

Year founded: 2016

2022 revenue: $1 billion

Local employees: 309

Total employees: 4,102 Profitable? Yes

National insurance and nancial services rm Alera Group — formed in 2017 as a merger of 24 independent companies — largely owes its meteoric growth to an ambitious acquisition strategy that has resulted in the group now encompassing more than 180 organizations.—

Katie Arnold-Ratli

Ballyhoo Hospitality’s restaurants include Sophia Steak in Lake Forest.

BALLYHOO HOSPITALITY

32. OppFi

5-year growth: 548.3%

Company description: Financial technology platform

Location: Chicago

Year founded: 2012

2022 revenue: $452.9 million

Local employees: 121

Total employees: 467

Profitable? Yes

Digital nancial platform OppFi’s has found success in catering to a large — 60 million people and counting — yet underserved population of Americans who are shut out from accessing traditional nancing. OppFi’s prioritization

of inclusion and social impact has allowed thousands to borrow funds during times of crisis. —

Katie Arnold-Ratli

33. Accel Construction Services Group

5-year growth: 510.3%

Company description: Construction management

Location: Chicago

Year founded: 2008

2022 revenue: $32 million

Local employees: 29

Total employees: 29

Profitable? Yes

A cozy warming house at the Prairie Crossing Metra station. A 150-apartment luxury development. Sleek new facilities for the Army Reserve. e result of these ambitious ventures? Accel Construction Services Group says its recent growth can be attributed almost entirely to its expansion into new markets and the increased scope of its projects.—

Katie Arnold-Ratli

34. Transportation One

5-year growth: 502.5%

Company description: Third-party logistics broker

Location: Chicago

Year founded: 2010

2022 revenue: $189.7 million

Local employees: 107

Total employees: 115

Profitable? Yes

By overhauling its focus on internal operations and accelerating its talent acquisition, Transportation One — a decade-old industry leader among carriers and shippers, with particular expertise in retail, food and beverages, consumer goods and original manufacturing — has grown by leaps and bounds.

— Katie Arnold-Ratli

35. DeSpir Logistics

5-year growth: 502.3%

Company description: Logistics services

Location: Lisle

Year founded: 2014

2022 revenue: $46.2 million

Local employees: 60

Total employees: 60

Profitable? Yes

In the high-wire world of shipping and carrying the most sensitive cargo — including medical supplies, hazardous materials and even fine art — DeSpir Logistics cites its stellar reputation and risk-reducing, time-tested processes for its quickly growing word-of-mouth customer base. —

Katie ArnoldRatli

36. Mariani Enterprises

5-year growth: 492.4%

Company description: Landscape design, construction and maintenance contractor

Location: Lake Bluff

Year founded: 1958

2022 revenue: $286.6 million

Local employees: 391

Total employees: 1,611

Profitable? Yes

Specializing in innovative, high-end landscape design that blends seamlessly with the structures it surrounds, including commercial projects and landscape maintenance, 65-yearold Mariani Enterprises credits its extensive growth in recent years to the quality of its customer service, high client-retention rates and a recent keen focus on acquisition.

— Katie ArnoldRatli

37. Topstep

5-year growth: 472.6%

Company description: Financial technology

Location: Chicago

Year founded: 2012

2022 revenue: $32.5 million

Local employees: 36

Total employees: 63

Profitable? Yes

Topstep, a proving ground for futures traders looking to perfect their craft in a low-risk environment, owes its recent growth in part to an expanded suite of features and offerings that has hit the sweet spot with its customers. That includes the addition of a trade desk, additional account options and faster payouts.

— Katie Arnold-Ratli

Mariani Enterprises has seen extensive growth in recent years.

MARIANI ENTERPRISES

38. Sprout Social

5-year growth: 466.4%

Company description: Social media management and analytics software

Location: Chicago

Year founded: 2010

2022 revenue: $253.8 million

Local employees: 530

Total employees: 1,147

Profitable? No

With the help of its partners, Sprout Social launched 120 products in 2022 alone, the same year the company cemented a major global partnership with Salesforce. Sprout Social has also doubled down on arti cial intelligence, machine learning and automation to help fuel client-favorite social media management features such as analytics and listening tools. —

Katie Arnold-Ratli

39. Right at School

5-year growth: 450.9%

Company description: Child care and enrichment programs

Location: Evanston

Year founded: 2010

2022 revenue: $78.3 million

Local employees: 240

Total employees: 3,000

Profitable? Yes

Providing highly sought-after before- and after-school care at sites nationwide, Right at School has seen tremendous organic growth:

Last year it added programs at 170 new schools. In addition, the easing of the pandemic’s impact helped return more kids to school, boosting enrollment. —

Katie Arnold-Ratli

40. OSM Worldwide

5-year growth: 433.9%

Company description: Parcel shipping carrier

Location: Glendale Heights

Year founded: 2003

2022 revenue: $520.4 million

Local employees: 101

Total employees: 336

Profitable? Yes

e 20-year-old parcel shipping carrier — which specializes in subscription box, publication, apparel, and health and beauty shipping, as well as shipping fulllment — added new customers and strengthened its o erings by expanding its stable of distribution centers. —

Katie Arnold-Ratli

41. AIT Worldwide Logistics

5-year growth: 413.7%

Company description: Global freight forwarder and logistics provider

Location: Itasca

Year founded: 1979

2022 revenue: $2.6 billion

Local employees: 437

Total employees: 2,508

Profitable? Yes

Operating via air, sea and ground, AIT Worldwide Logistics is a versatile shipper that handles supply chain concerns, from customs clearance to high-speed shipping needs. And the company has particularly hit its stride by executing its strategic growth plan at a time of high demand for high-quality, end-to-end supply chain solutions. — Katie

Arnold-Ratli

42. Neighborhood Loans

5-year growth: 404.5%

Company description: Residential mortgage lender

Location: Downers Grove

Year founded: 2009

2022 revenue: $84.9 million

Local employees: 221

Total employees: 455

Profitable? Yes

With an approachable, guidance-oriented vibe, Neighborhood Loans — founded in 2009, just after the mortgage crisis — aims to make homeownership a reality for all who desire it. e company’s nationwide expansion in the past ve years has resulted in new o ces, new loan o cers and a fast-growing customer base.

— Katie Arnold-Ratli

43. Edge Logistics

5-year growth: 397.0%

Company description: Freight broker

Location: Chicago

Year founded: 2014

2022 revenue: $149.4 million

Local employees: 80

Total employees: 208

Profitable? Yes

Hauling freight under unique

circumstances — carrying liquid or temperature-sensitive cargo, crossing borders, and transporting automobiles — is a di cult endeavor, but Edge Logistics has been making it happen since 2014. Last year the company doubled its headcount and added both a new o ce and a new app that pairs customers with carriers using cutting-edge optimization technology.

— Katie Arnold-Ratli

44. Endurance Warranty Services

5-year growth: 394.1%

Company description: Vehicle service contracts

Location: Northbrook

Year founded: 2006

2022 revenue: $1.2 billion

Local employees: 320

Total employees: 700

A Right at School student teaches her peers how to sign “I am grateful” as part of the Junior Educator leadership program for students in upper elementary grades.

Parts Town Unlimited credits a range of factors for its recent growth.

Profitable? Yes

Last year was a urry of activity for Endurance Warranty Services, which supplements auto insurance to cover high out-of-pocket consumer costs. In 2022, the company added an e-commerce experience; changed up its approach to its brand, creative, analytics and marketing; and kept a sharp eye out for strong acquisition targets. —

Katie Arnold-Ratli

45. Millennium Trust

5-year growth: 369.6%

Company description: Consumer benefits services

Location: Oak Brook

Year founded: 2000

2022 revenue: $408.2 million

Local employees: 425

Total employees: 1,126

Profitable? Yes

On top of its steady organic growth — customer accounts leapt by 3 million last year — Millennium Trust also completed its acquisition of PayFlex, deepening its slate of o erings, which now include retirement investing and nancial services for individuals and bene ts design and solutions for employers.— Katie Arnold-Ratli

46. Parts Town Unlimited

5-year growth: 367.5%

Company description: Food-service parts manufacturing and distribution

Location: Addison

Year founded: 1987

2022 revenue: $1.8 billion

Local employees: 927

Total employees: 4,885

Profitable? Yes

Distributing everything from replacement water lter cartridges to refrigerator door gaskets, Parts Town Unlimited ascribes its recent revenue growth to a year of continuous innovation, new acquisitions and partnerships, new investors, international expansion and new master distribution programs with industry-leading manufacturers. — Katie

ArnoldRatli

47. Cardenas Marketing Network

5-year growth: 367.2%

Company description: Experiential brand marketing agency

Location: Chicago

Year founded: 2002

2022 revenue: $390 million

Local employees: 39

Total employees: 57

Profitable? Yes

Specializing in promoting Latin American musical acts such as Bad Bunny and Marc Anthony, as well as a slate of soccer matches, Cardenas Marketing Network says

its business boom is partly due to pent-up post-pandemic demand for public performances and a growing roster of performers.

— Katie Arnold-Ratli

48. Dynamic Utility Solutions

5-year growth: 357.1%

Company description: Electric utility contractor

Location: Carol Stream

Year founded: 2016

2022 revenue: $36 million

Local employees: 109

Total employees: 109

Profitable? No

Citing an increasing demand for safe, experienced and knowledgeable utilities construction services as the reason for its continued growth, Dynamic Utility Solutions serves as contractor and subcontractor for above- and below-ground electrical projects, providing directional boring services, storm and emergency power restoration and commercial electrical construction needs.

— Katie Arnold-Ratli

49. Redwood Logistics

5-year growth: 353.8%

Company description: Logistics platform

Location: Chicago

Year founded: 2001

2022 revenue: $1.3 billion

Local employees: 414

Total employees: 931

Profitable? Yes

Whether overseeing supply chain logistics with its own eet of carriers or serving as broker to get the job done, Redwood Logistics moves and manages every aspect of the freight journey. A strong word-of-mouth reputation and innovative use of data analysis and ful llment technology have contributed to its recent growth.

— Katie Arnold-Ratli

50. CapGrow Partners

5-year growth: 350.5%

Company description: Community housing services

Location: Chicago

Year founded: 2006

2022 revenue: $30 million

Local employees: 9

Total employees: 9

Profitable? Yes

Since 2006, CapGrow has been helping to provide safe communal housing for individuals with behavioral health needs, substance abuse issues, brain injuries or mental illness. In 2022, the organization switched from tax-basis accounting to generally accepted accounting principles, helping boost its revenue.— Katie Arnold-Ratli

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CAREER OPPORTUNITY

Aktion Associates is looking for an Account Manager/Sales Representative for one of our top markets -- Chicago, IL along with the full Central US territory. The successful candidate will have a proven track record in developing customer relationships and delivering customer value by providing ERP software/technology guidance to midmarket companies in the Architectural Engineering and Construction (AEC) industries. Aktion Associates delivers industry-specific and market leader application solutions to the Architecture & Engineering, Construction, Wholesale Distribution and Manufacturing industries. We couple these application solutions with proven business process transformation skills that deliver the best Net Promoter Scores in the ERP industry for small and medium-size businesses. More information at Jobs.Chicagobusiness.com

To place your listing, contact Suzanne Janik at (313) 446-0455 or email sjanik@crain.com .www.chicagobusiness.com/classi eds CAREER

CAREER OPPORTUNITY

Panel offers options to settle Exelon lawsuits

best interest of the company at that time.”

e settlement terms haven’t yet been led.

e seven-week trial, and months of preparation for it, presumably have run up a substantial legal tab for Pramaggiore and Hooker so far. at will only grow as they pursue appeals.

Lassar told reporters the day Pramaggiore was convicted that she would appeal. Hooker’s attorneys haven’t spoken of their plans for appeal.

Lassar declined to comment for this story. Monico and Jacobson didn’t respond to emails requesting comment.

“As the ling explains, the board will determine after the appeals are exhausted whether it is in the best interest of the company to pursue claims against Ms. Pramaggiore or Mr. Hooker,” an Exelon spokeswoman said.

speaker, awaits trial on federal racketeering charges, which include the ComEd issues.

From 2011 to 2019, Pramaggiore received $5.2 million in cash incentive payments, according to proxy lings. She received millions more in performance-based stock awards.

Exelon’s policy regarding recoupment of incentive pay as of 2018 stated that the board could pursue clawback of past compensation if an executive “engaged or participated in misconduct or intentional or reckless acts or omissions or serious neglect of responsibilities that caused or contributed to a signi cant nancial loss or serious reputational harm to Exelon or its subsidiaries regardless of whether a nancial statement restatement or correction of incentive plan results was required; and recoupment is not precluded by applicable law or employment agreements.”

ComEd’s bribery admissions in July 2020 under a deferred-prosecution agreement with the U.S. Attorney’s o ce in Chicago.

e two directors — W. Paul Bowers and Marjorie Rodgers Cheshire — on May 19 recommended the board approve the settlement. e full board did so on May 22, according to the ling.

e most recent of the shareholder lawsuits was led in federal court in Chicago on May 1, just a day before the “ComEd Four” were found guilty.

e plainti , the City of Coral Springs Police O cers Pension Plan, emphasized that Exelon and ComEd continue to feel the negative impacts of the bribery scheme, nearly three years after ComEd admitted to it.

REPUTATION DAMAGED

CAREER OPPORTUNITY

Exelon is obliged to cover Pramaggiore and Hooker’s legal costs under corporate bylaws. But those are subject to potential recovery if the two are found guilty and the verdicts are upheld. ComEd told WBEZ in a story last month that ratepayers aren’t shouldering any of the legal fees.

As to incentive compensation for Pramaggiore, that was substantial during the period the trial covered — 2011 through 2019. She served as ComEd CEO from 2012 to 2018 and then was promoted to CEO of all Exelon utilities in 2019. She left the company under a legal cloud in 2020, after ComEd had admitted to a nearly decade-long bribery scheme to curry favor with then-House Speaker Michael Madigan in pursuit of passage of lucrative state legislation.

Hooker’s at-risk incentive pay would cover only 2011 and 2012 because he retired from Exelon in the rst half of 2012. He wasn’t paid enough to be included among those whose compensation was disclosed.

Exelon’s special litigation committee, comprised of unnamed “disinterested and independent parties,” in the ling said it probed the claims in the shareholder suits over nearly two years, reviewing 450,000 documents and interviewing more than 20 witnesses.

Exelon’s board agreed to submit the issues to a mediator — former U.S. District Judge Layn Phillips — in April 2022. e parties, as well as Exelon’s insurers which likely are shouldering most if not all the legal costs for Pramaggiore and Hooker, reached a settlement in late April 2023, according to the ling.

Also involved beginning in July 2022 was an independent review committee, made up of two Exelon directors who joined after

Apart from hundreds of millions in nes, refunds and legal costs, “ e bribery scandal has led to a huge reputational hit for the company and for Exelon as a whole and for its leadership,” the complaint stated.

“Furthermore, ComEd’s longterm business interests are now impaired because o cials will bend over backwards to not look like they are favoring the company,” the complaint went on. “ is will mean that ComEd’s legitimate legislative concerns will go unaddressed for years to come, leading to the long-term impairment of the business due to how heavily regulated ComEd is as a utility business.”

Indeed, look no further than the recently concluded spring session of the General Assembly. Downstate electric utility Ameren Illinois won passage of legislation giving it a monopoly over the construction and operation of all future high-voltage power lines. ComEd wasn’t given the same favor. at never would have occurred prior to the scandal.

MADIGAN AWAITING TRIAL Madigan, who retired in 2021 after decades as Illinois House

EXELON from Page 3

Exelon is obliged to cover Anne Pramaggiore and John Hooker’s legal costs under corporate bylaws. But those are subject to potential recovery if the two are found guilty and the verdicts are upheld.

ALAMY

CRAIN’S DINING AND ENTERTAINMENT GUIDE

From private dining to specialty steakhouses, here are options for your next business meal.

BANDOL

100 West Monroe Street, Chicago, IL 60603 312-877-5713 • bandolrestaurant.com

Brasserie & Raw Bar. A Southern French coastal inspired urban oasis, Bandol’s menu intertwines French and Mediterranean classics with modern seafood, raw bar and a sophisticated-casual touch. Using the freshest ingredients and local seafood, Bandol creates delicious steak tartare, prime rib sandwiches, burgers, salads, and more! Our raw bar features the best selections with oysters, salmon, and nancial district’s best shrimp cocktails.

FILLMORE

120 West Monroe Street, Chicago, IL 60603 312-312-2142 • llmorerestaurant.com

West Coast American-Asian-Sushi. Inventive in spirit and modern in approach, The Fillmore updates the traditional bistro, seamlessly blending contemporary West Coast cuisine with Asian-fusion in uences. Menu signatures include premium steaks and seafood, hearth-roasted sh and chicken, Wagyu burgers, healthy salads and more. Creative, hand-rolled sushi, sashimi and nigiri play the menu’s center stage along with bourbons, Japanese whiskeys and sakes.

REMINGTON’S AMERICAN GRILL

20 North Michigan Avenue, Chicago, IL 60602

312-782-6000 • remingtonschicago.com

Located across the street from downtown Chicago’s cherished Millennium Park is Remington’s – a classic American grill and steakhouse serving up warm hospitality, unparalleled service, and satisfying cuisine. Remington’s menu features classic American fare and Chicago Steakhouse classics.

The luxurious and rich interiors create an appealing ambiance for travelers and locals alike with the perfect setting for social gatherings and private parties.

BERNARD’S

11 East Walton, Chicago, IL 60611 312-646-1402 • bernardschicago.com

Bernard’s is a landmark cocktail lounge built upon precise cocktails that pay tribute to the past through moments grounded in the present. Returning after an extended hiatus, the resurrection of Bernard’s takes root in the heart of Chicago’s Gold Coast, offering unforgettable experiences guided by knowledgeable staff, re ned cocktails that each have a story, and exceptional plates of nosh.

GRILL ON 21

208 South LaSalle Street, Chicago, IL 60604 312-634-0000 ext. 3 • grillon21.com

A Cut Above Classic. Located on the 21st oor of the Lasalle Hotel, Grill on 21 is a modern approach to a classic steakhouse, blending timeless dishes with a contemporary ambiance. Centrally located in the heart of Chicago’s Financial District, an ideal destination for professionals, fancy date nights, and locals alike. The menu features a diverse array of grilled steaks, chops, hearth-roasted sh, poultry, and plantbased items.

ROSEBUD ROSETTA ITALIAN

1 South Dearborn Street, Chicago, IL 60603 312-384-1900 • rosebudrestaurants.com/ locations/rosetta-italian/

Located amidst Chicago’s nest entertainment venues and steps away from the heart of the Loop, Rosebud Rosetta Italian features a stunning indoor dining space, bar and outdoor piazza! With Rosebud’s impeccable reputation for serving only the highest-quality steaks, seafood and Italian recipes, you’re sure to leave the restaurant satis ed. Rosebud Restaurants have been serving Chicago and the surrounding suburbs since 1976.

BLVD STEAKHOUSE

817 West Lake Street, Chicago, IL 60607 312-526-3116 • blvdchicago.com

Located in the Fulton Market District, BLVD Steakhouse is a classic American steakhouse inspired by Hollywood’s Sunset Blvd. Helmed by Celebrity Chef/Partner Joe Flamm, the restaurant embodies the glamour and luxury that de ned Old Hollywood offering sophisticated yet approachable service along with prime cuts and fresh seafood, innovative twists on 1950s cocktails, and an award-winning list of wines.

THE M ROOM

450 N Clark St, Chicago, IL 60654 312-224-1650 • mroomchicago.com

Explore the perfect harmony of Dish and Dram at The M Room. The culinary team behind Roka Akor has created a one-of-kind chef tasting menu, highlighting the ingredients and avors used in The Macallan whisky making process. Indulge in the Macallan craft cocktails, Signature The Macallan pours, or opt for our sommelier wine pairing.

ROSE MARY

932 West Fulton Market, Chicago, IL 60607 872-260-3921 • rosemarychicago.com

Located in the Fulton Market District, Rose Mary is inspired by Celebrity Chef/Partner Joe Flamm’s Italian heritage and the bold, bright avors of Croatian cuisine. The award-winning restaurant offers a seasonal menu featuring house-made pasta and risottos, fresh seafood, and grilled meats, along with craft cocktails and a diverse list of Eastern European wines.

Crain’s Dining and Entertainment Guide showcases a variety of Chicagoland restaurants, bars, private spaces and entertainment venues. This special advertising guide will highlight new menus, spotlight chefs and promote any upcoming special events. To reserve your spot in the guide, please contact Menia Pappas at menia.pappas@crain.com.

Johnson allies push to eliminate sub-minimum wage for city’s tipped workers

leader, told Crain’s the mayor campaigned on the issue and Ramirez-Rosa is working to build support in the City Council.

One Fair Wage, a national advocacy group that has partnered with in uential union SEIU to push for the elimination of the tipped wage, held an initial brie ng at City Hall with some aldermen since Johnson’s election, Ramirez-Rosa said. e tipped wage is expected to be phased out over time, but the length of that phaseout will be central to negotiations between the coalition pushing for the legislation and industry groups, including the Illinois Restaurant Association.

“I know that, obviously, the Illinois Restaurant Association has some concerns, so I’m committed to working collaboratively,” Ramirez-Rosa said. “I think that there’s growing support, but it’s going to take a conversation and it’s going to take collaboration to gure out what those next steps look like.”

Sam Toia, head of the Illinois Restaurant Association, was central to negotiating the compromise in 2019 that saw a one-time boost in the tipped wage without doing away with it altogether.

At the time, Toia and other

restaurant groups mobilized to argue that eliminating the tipped wage would strain the bottom line of independent restaurants already operating on thin margins.

“I look forward to being at the table with the powers that be when an ordinance is ready to be discussed,” Toia told Crain’s. “Businesses like to see a plan so they can work it into their business plan, which is usually a veyear plan.”

Ramirez-Rosa did not say when an ordinance would be introduced, but another council member familiar with the conversations said it is likely to move forward during the city’s annual budget process this fall, similar to how Lightfoot increased the city’s minimum wage in 2019.

Doing so would allow the administration and advocates more time to push for the issue while staving o a potentially prickly ght with restaurant owners while the Johnson team crafts its early legislative agenda.

CULTURE SHIFT

Beyond Johnson’s election and a new crop of progressive alderpersons, Saru Jayaraman, president of One Fair Wage, said there’s been a shift around the issue because so many restaurant workers left the industry during the pandemic.

One Fair Wage has linked the National Restaurant Association to a push in statehouses across the country to weaken child labor laws to allow teenagers to work longer hours and later into the evening in an e ort to hire new sta . Washington, D.C., voters approved a ballot measure in November that creates a four-year phaseout of the tipped wage in the nation’s capital.

“With the pandemic, about 1.2 million workers have just walked o the job,” Jayaraman said. “Chicago would really be just part of the momentum that’s sweeping the country to get these restaurant workers back to work.”

Pointing to the history of the sub-minimum wage taking root in the post-Civil War era, Jayaraman says tipped workers are “actually still overwhelmingly women and people of color.”

“Single mothers, mostly working in very casual restaurants in Chicago, struggling with three times the poverty rate, and the absolute highest rates of sexual harassment of any industry, because they put up with so much to get to get those tips,” she said.

One Fair Wage is also pushing its agenda in state capitals across the country, including in Illinois, where Johnson’s new deputy chief of sta , state Sen. Cristina Pacione-Zayas, was the

lead sponsor of a bill that failed to move in the spring session calling for a statewide elimination of the tipped wage by Jan. 1, 2026.

NEXT STEPS

While 75% of tipped workers are restaurant and bar employees, other workers include employees at nail and hair salons and car washes and parking attendants. e city already eliminated the sub-minimum wage for wheelchair attendants at O’Hare and Midway airports.

One Fair Wage will soon release a report in support of the legislation and hold a City Hall press conference this week with union allies as well as some restaurant owners who have already adopted paying the city’s minimum wage, Jayaraman said.

e advocates have another important ally in SEIU Healthcare, a union that heavily backed Johnson during his mayoral campaign and endorsed 31 of the 50 members of the City Council, including nine freshmen.

e union celebrated the minimum wage increase in 2019 while lamenting that the compromise “leaves in place a awed sub-minimum wage pay system.”

“We always promised to come back to it,” Anthony Driver, executive director of the SEIU Illinois State Council, said June 12.

At these Chicago firms, artificial intelligence isn’t the future — it’s now

questions coming in: Is it a friend or a foe?” says James Rhodes, chief technology o cer at nancial data provider Morningstar. “We believe this technology has the potential to signi cantly improve our clients’ experiences in the work they do today in a safe, reliable way.”

ChatGPT, released to the public six months ago by San Francisco-based startup OpenAI, revealed huge advances in the ability of machines to understand and generate speech in ways that are surprisingly wide-ranging, less robotic, and essentially indistinguishable from human writing and conversation.

ChatGPT reached 100 million users in just a couple of months, the fastest adoption ever for a technology, researchers say. S&P Global Market Intelligence forecasts AI revenue to grow tenfold in five years to $36 billion.

Automating communication holds the promise of unleashing a new wave of productivity gains like the one that came from digitization. Goldman Sachs estimates generative AI could increase labor productivity growth by 1.5 percentage points annually. It could boost global GDP by 7% a year.

The technology is powerful but not well understood. Warnings abound over generative AI’s potential to produce accidental misinformation and intentional disinformation, while enabling intellectual-property theft and fraud.

‘BRIGHTEST, SHINIEST OBJECT’

Political and industry leaders already have called for regulation to deal with the dangers, including societal and economic costs. Goldman predicts generative AI could be substituted for up to 25% of human work, putting 300 million jobs worldwide at risk of automation.

Technologists have been training machines to understand human language for a long time. What’s different about ChatGPT is the sheer volume of conversation it has ingested, combined with an easyto-use interface that makes it instantly accessible to people without specialized training. Users can ask it to write a business proposal, a song or software code with the ease of writing a text or email.

“This has got to be the brightest, shiniest object anyone has ever seen,” says Kristian Hammond, a Northwestern University professor and co-founder of Narrative Science, an artificial-intelligence startup that was acquired last year by Salesforce. “You can’t not pay attention to ChatGPT because of the massive uptake and the func-

tionality you get with it.”

Morningstar quickly incorporated a variant of ChatGPT into a handful of existing products for financial advisers as well as individuals, dubbing the new chatbot “Mo.” Introduced in late April, it allows users to easily probe the company’s decades of information to get answers about everything from investing basics to sophisticated portfolio strategy.

Aware of potential risks, Morningstar put guardrails in place. “We made certain tradeoffs,” Rhodes says. “Mo has no memory: The reason was so we weren’t capturing (personal information). The downside is that you can’t drill into questions. The tech here is super-complicated. It’s not easy to wrap your head around.”

At JPMorgan, Beer says early uses likely will be more utilitarian than gee-whiz, such as virtual assistants for internal use, but not for customer interactions.

“We have to understand where do we see the potential and how do we put the right validation in place that the response is an appropriate response,” she says.

Urbanbelly restaurant in Wicker Park is using artificial intelligence to scour the restaurant’s sales data to help kitchen workers figure out how much food to prepare on, say, a Saturday when it’s 70 degrees outside. The restaurant started using the technology a little more than a month ago, and Chef Bill Kim figures it could save him 2% to 3% in food costs.

“Most restaurants, if you make 6% (profit), you’re actually doing OK,” says Kim, who is Urbanbelly’s founder and chef-partner at Cornerstone Restaurant group. “If you’re . . . saving 2% to 3%, that’s massive. If you do it over 10 concepts, 15 concepts, that’s real money.”

The legal industry has long been rife with opportunity to automate expensive grunt work done by highly paid young lawyers.

“At this point, every law firm, every legal department, has to have a plan for how they’re going to use AI and start incorporating it,” said Sean Monahan, a senior director at HBR Consulting, which advises law firms across the country. “Otherwise, they’re getting left behind.”

SHIFTING R&D MONEY

Relativity, which makes software used by law firms for document review, has multiple products in development using GPT technology. Chief Product Officer Chris Brown says Chicago-based Relativity is shifting more of its $140 million research and development budget to AI.

“There’s heavy interest from certain clients,” Brown says. “We intend to be shipping something with GPT capability this year.”

Still, Relativity outlined the risks in a March blog post calling attention to concerns about protecting confidential client information and the accuracy of material generated by the technology. Not long afterward, a judge in New York discovered

Accenture has 1,600 workers focused on generative AI, and Chakraborty says the Chicago ofce is one of the rm’s hubs for it. “ ere’s no question leading Chicago-based companies are keeping pace with their peers throughout the world,” he says.

‘IT HELPS PATIENT CARE’

In the health care sector, Northwestern Medicine has been using artificial intelligence over the past five years to communicate with patients online and help physicians complete patient paperwork faster. It’s also using the technology underlying ChatGPT to read reports from MRI, X-ray and ultrasound procedures and help doctors quickly identify patients who need follow-up care.

Northwestern Medicine Chief Information Officer Doug King says the technology has been used to read more than 1.3 million reports and identified 65,000 issues that required follow up in 45,000 patients.

“It’s quite impactful,” King says. “It helps patient care, and it also takes a lot of the manual work off the physicians.”

Eric Lefkofsky’s health care data startup Tempus already was using artificial intelligence to help doctors make better use of gene-sequencing tests to treat patients and match them with clinical research trials. The company recently launched a virtual assistant that uses generative AI to provide doctors with patient data and treatment options more quickly.

that a brief written by a lawyer using ChatGPT was filled with made-up legal cases and bogus quotes.

“What a lot of people are finding is you still have to have that lawyer in the middle of everything,” says Monahan, the legal consultant. “You can’t just sort of put a question in and get a good answer.”

The rollout of ChatGPT is a potential boon for consulting firms such as Accenture.

“In the last six months, ChatGPT and generative AI has completely dominated the conversation at the board level and the C-suite level,” says Arnab Chakraborty, a Chicago-based senior managing director who leads Accenture’s data and AI practice in North America. “Every day, I’m having three or four conversations about it. This an iPhone moment.”

Consultants must quickly develop expertise in the field to meet the demand, which strains hiring and training. The company already has launched a generative AI academy to train all of its 738,000 employees.

United Airlines relies on AI for everything from customer service to predictive maintenance. In recent years, it has incorporated kiosks and mobile apps to make travel more of a DIY experience for passengers. Chatbots handle more than 20% of customer-service contact at the airline.

Chief Information O cer Jason Birnbaum says United has identi ed a half-dozen potential uses for ChatGPT technology but declines to discuss speci cs.

“We’re actively prototyping right now,” he says. “Because it’s so new, we’re going through due diligence in terms of privacy and security. We’re not swinging the barn doors wide open.”

When United is ready to “pull the trigger” on ChatGPT, Birnbaum predicts the technology will “become more of a line item in our budgets.”

Companies such as United can’t afford to ignore ChatGPT. But they’re bringing skepticism, born of hard lessons from past technology hype cycles that were overblown and came with pitfalls that went unnoticed until it was too late.

Crain’s Ally Marotti, Brandon Dupré, Katherine Davis and Jon Asplund contributed.

James Rhodes, chief technology o cer at nancial data provider Morningstar.

Chris Brown, chief product o cer at Relativity.

COURTESY OF MORNINGSTAR

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