Crain's Chicago Business, December 18, 2023 by crainschicago

CHICAGOBUSINESS.COM I DECEMBER 18, 2023

Pritzker family office launches venture fund

Tom Bowen is a Chicago political strategist.

At $190 million, 53 Stations is one of the largest venture-capital funds in Chicago, alongside S2G Ventures, Jump Capital and Lightbank By John Pletz

Another part of the Pritzker family is getting into the venturecapital business. The Pritzker Organization, the family office of Hyatt Chairman Tom Pritzker, launched a $190 million venture-capital fund called 53 Stations. It’s led by Jason Pritzker, Tom’s son and vice chairman of The Pritzker Organization, and Kevin King, a former partner at venture-capital fund General Catalyst, based in Cambridge, Mass. They’re joined by Kelly Goldstein, a venture investor formerly with HQ and Harlem Capital. At $190 million, 53 Stations is one of the largest venture funds in Chicago, alongside S2G Ventures, Jump Capital and Lightbank. It joins several other Pritzkerfamily venture funds. J.B. and Tony Pritzker, who are cousins of

Tom, launched Pritzker Group Venture Capital more than two decades ago. Their sister, Penny Pritzker, makes venture investments through a firm called PSP Growth. Jason Pritzker, 44, founded two startups, including Yapmo, now called Konverse, and Visible Vote. He also was an early investor in Chicago-based e-commerce company Raise Marketplace. The Pritzker Organization has traditionally focused on private equity, or buying controlling interests in mature companies, and later-stage, growth-equity investing. Among its growthstage investments are Blue Voyant, Dataminr, Nimble Robotics, Palantir, SpaceX and Uber. The idea to launch a venture fund came up at a corporate strategic retreat a few years ago, See PRITZKER on Page 34

FORUM

ELECTION SYSTEM

EQUITY Clarence Shaffer is working as a security contractor while being the primary caretaker for his 88-year-old mother.

GEOFFREY BLACK

Voting reform initiatives in Illinois and elsewhere aim to give voters more say in the outcomes I PAGE 15

GEOFFREY BLACK

MAKEOVER

A popular salvo against poverty Sixty years after the ‘war on poverty’ in the U.S., Chicago and Cook County are trying guaranteed income programs to provide some measure of economic security I PAGE 25

GREG HINZ It’s time to size up Gov. Pritzker’s presidential ambitions.

MADELEINE DOUBEK Here’s a gift that Illinois politicians would be wise to give voters.

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GREG HINZ ON POLITICS

Time to size up Pritzker’s presidential ambitions

s Joe Biden continues to sink in polls — and as J.B. Pritzker continues to show a bit more presidential leg just about every week — it’s time to ask: Does Illinois’ two-term Democratic governor have his eyes set on a possible White House bid and, if so, does he really stand a chance? The answer to both questions is yes. But not exactly in the way you might think. After talking to Team Pritzker a bunch of Greg Hinz and other pros whose judgment I trust, I’m pretty much convinced Pritzker’s activity is aimed at down the road, as in the 2028 election, and maybe other ambitions that could be given a push with an expanded national profile. No, he’s not running against

Biden. And if Biden does abruptly drop out — driven by a health scare, a GOP surprise or a Democratic Party in revolt? Unlikely. But in this utterly unpredictable, no-rules political environment, it’s not impossible. As even casual political observers know, Pritzker has been going out of his way for months to do the kind of things presidential wannabees do. Like leading the charge in Springfield to enact abortion protections, limits on gun sales and other items that are popular in the Democratic base. Or giving speeches in New Hampshire and Florida, and making frequent appearances on cable TV. Or setting up and funding a national abortion-rights group led by his highly capable former campaign manager, Mike Ollen, and dropping $1 million into a key Wisconsin Supreme Court race. Even his appearance at a Crain’s

luncheon recently seemed to fall into that mold as Pritzker avidly described how the state’s economic prospects have turned around on his watch. Creating lots of jobs is good politics. Given that — and Pritzker’s ability to self-fund a race — he’s naturally put into an A-list of post-Biden potential nominees, along with California Gov. Gavin Newsom and Vice President Kamala Harris, says David Yepsen, former director of the Paul Simon Public Policy Institute at Southern Illinois University and an experienced presidential campaign watcher by virtue of his earlier long tenure as political editor of the Des Moines Register. If Pritzker ever got to voters in a Biden-less primary, “I think he could do well,” says Yepsen. But it might never get to voters. In March 1968, when Lyndon Baines Johnson hung it up in mid-cycle, there were still plenty of delegates yet to be claimed in

late primaries in places such as California and New York. This year, the cycle has been intentionally tightened, with candidates for president required to declare their candidacy in most states by now and virtually all by the end of the January, notes Democratic strategist Pete Giangreco. That means any Pritzker 2024 shot would depend on Biden dropping out after most or all delegates are selected. In other words, maneuvering through a brokered convention, one in which Pritzker’s advantage of being able to spend a lot in a hurry would be minimized as other potential candidates such as, say, U.S. Transportation Secretary Pete Buttigieg get a chance to strut their stuff in party backrooms. As Giangreco puts it, “The window where Pritzker’s millions make a difference is rapidly closing.” Team Pritzker has insisted from

the beginning that he’s for Biden and that building support for abortion rights, et al., actually will help the incumbent win a general election against Donald Trump. Also, a higher profile could help Pritzker better sell the state to business, or lead to a cabinet job. From the opposite direction, the Illinois Republican Party raises some notes on some issues, such as crime, that could hurt a Pritzker bid. “If Democrats want high taxes, unserious handling of crime, and even more lax border policies, then J.B. Pritzker is their man,” says state GOP Party Chairman Don Tracy in a written statement. Still, with the nation seemingly unhappy with the notion of a repeat battle between two octogenarians — and the Democratic National Convention right here in Chicago — I’m not making any final predictions. People wrote off Barack Obama, too, a year out.

MADELEINE DOUBEK ON GOVERNMENT

Here’s a gift Illinois pols would be wise to give voters

ssst! Hey you, lawmakers and wannabe elected officials. Have I got a winner of an idea for you! Not sure if you’ve had time to scroll through social media lately, but I came across an exchange that went something like this: “Got the property tax bill today. Spouse’s reaction? Guess we’ll be having cat food for Christmas dinner.” This was followed by several comments from people chiming in who similarly felt the tax-bill pain, and a few even said Madeleine who they’d had to sell Doubek their homes and find someplace cheaper to live because the tax lift just got too heavy. So, the winning idea? Work hard, get elected and turn yourself and your colleagues into champions of government streamlining and efficiency. Seriously, I don’t know why more of our bright public servants haven’t seized on this one yet and pushed harder to get it done. Perhaps it’s because, as they come up through the ranks in government and politics, they start locally and become friends with the many other local government officials who fear losing their jobs or having to tell government workers they might lose theirs. Whatever the reason, this remains a cause that is ripe for someone or several someones to dig into and own. My own property tax bill arrived a few weeks ago. I did the math and it went up from 2021 to 2022 by 6.9%. Sure, it could have been much worse, but it’s never, ever gone down. My bill had charges for 15 different units of government or 2 | CRAIN’S CHICAGO BUSINESS | DECEMBER 18, 2023

tax funds. There wasn’t just township government; there’s the township road and bridge fund and the township general assistance fund. There’s mosquito abatement and water reclamation and park districts. There isn’t just one consolidated school district in my community. We’ve got a community college, a high school district and an elementary district. They all have administrators and managers and pensions we’re supporting. And, if that’s not enough, there’s four different line items for various components of Cook County government. Among the 15 lines listed on the bill, not one charged less money or held the line, of course. They all charged more, and they always do. But the reality, of course, for all of us supporting all of these governments — either through homeownership or our rental rates — is that we’re not always getting raises every year or ones big enough to keep up with these bills and the other inflationary increases. Illinois isn’t as big as California or Texas or Florida, but Illinois does win the prize for having the most units of government of any state. That shouldn’t be a point of pride for any of us. Almost three years ago, the fine researchers at the Civic Federation conducted a study, did the counting and found we have 8,923 local government units. The Civic Federation found that figure was 30% higher than the U.S. Census of Governments numbers frequently cited by media. Over the years, some state lawmakers have tried to introduce laws to encourage streamlining, efficiency and consolidation. There have been task forces that take testimony about the bloat, but inertia always seems to win the day and not enough of these efforts

have been enacted as law. When the efforts have succeeded, the government officials who are targeted by an effort to streamline typically get organized and fight back, making the case to their supporters that their government unit couldn’t possibly go away or share services with another. Those efforts have tended to win because most of us average residents are busy with our own lives and jobs and running the kids around to after-school activities. But the jolt of those rising tax bills does hit and stops us in our tracks now and then. I have seen and read enough

stories from communities downstate to know that some people find their township governments much more necessary than some of us do in the metro region, where we have municipal and county governments that easily could cover the services townships provide. So, one-size-fits-all solutions won’t necessarily work, but surely there ought to be more that can be done to economize, consolidate and cut back on some of these government units. As the late, wonderful former Civic Federation President Laurence Msall said back in 2021,

“Streamlining redundant services makes financial sense and would put Illinois governments in line with best practices.” Doing so in 2024 not only would be a tremendous way to honor Msall, but I’m betting the elected officials who turn themselves into successful efficiency champions would reap the rewards of a grateful voting and taxpaying public. Madeleine Doubek is executive director of Change Illinois, a nonpartisan nonprofit that advocates for ethical and efficient government.

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Co-working giant plans big expansion in suburbs workspace strategies and indiIWG aims to open vidual users looking for low-risk offices they can lease with little 17 locations in the commitment and across a broad Chicago area next year network of locations. By Danny Ecker

The Hampton Social in Orlando I PHOTO COURTESY OF PARKER HOSPITALITY

Chicago restaurants expanding to the South Tantalized by warm weather and growing populations, restaurant groups see it as a way to diversify and grow revenue streams, albeit a risky one I By Ally Marotti

antalized by warm weather and growing populations, Chicago-based restaurant groups are flocking to the South. And for many groups, the migration has just begun. Restaurants headquartered in Chicago opened 224 locations in 2021 throughout Florida, Texas and other Southern and Sun Belt states, according to data from market research firm Datassential. Those openings included chains such as McDonald’s and sitdown spots like The Hampton Social. Openings ticked up further in 2022 to 240, according to the data. Compare that to 42 in 2019, before the COVID-19 pandemic. Expanding outside of Chicago is a way to diversify and grow See RESTAURANTS on Page 34

“If it wasn’t for our Southern stores, we would’ve lost our entire company.” — Brad Parker, founder and CEO of Parker Hospitality

Co-working provider IWG plans to open more than a dozen new locations in the Chicago area next year, adding to a massive bet it is making on demand for shared office space in the wake of the COVID-19 pandemic. The company announced on Nov. 28 that it will debut 17 new flexible office locations over the next year in buildings throughout the Chicago area — primarily in the suburbs — as well as two more Illinois locations, in Peoria and Moline. Zug, Switzerlandbased IWG, which operates the Regus, Spaces, HQ and Signature co-working brands, will add the new offices to its collection of 64 locations already operating across the state. It’s part of a larger wager IWG is making that office space leased on short-term, flexible deals has a bright future as the remote work movement weakens demand for traditional workspace. While big office landlords are getting pummeled by companies shrinking their office footprints, demand for co-working spaces has been resilient thanks to companies incorporating such shared offices into their broader

Even embattled co-working giant WeWork, which filed for Chapter 11 bankruptcy protection earlier this month, has many locations that are performing well and stand to continue operating as the company reorganizes. Over the past year, IWG has

“Our expansion in Illinois comes at a time when more companies are discovering that hybrid working boosts employee happiness and satisfaction.” — Mark Dixon, IWG CEO and founder, said in a statement added 600 locations globally and 300 across the U.S., according to the company. Its total footprint now includes about 4,000 locations in more than 120 countries. The company earlier this year announced plans for four new locations in Chicago, all of which See IWG on Page 34

Draper & Kramer takes loss in $59M apartment sale By Rachel Herzog

Longtime Chicago developer Draper & Kramer has taken a loss on a South Loop apartment tower, selling the Aspire Residences to a New Jersey landlord for less than the construction loan it used to build them. A venture led by Antheus Capital, a major South Side multifamily owner, last month paid $59 million for Aspire Residences, a 24-story, 275-unit high-rise at 2111 S. Wabash Ave. that opened in 2020, according to Cook County property records. Draper & Kramer took out a $69 million construction loan to build the apartment

complex, Crain’s reported in 2019. The deal is evidence that strong rental demand in downtown Chicago may not be enough to offset the negative impact of high interest rates on pricing. Nationally, multifamily sales were down by 64% year over year as of October, according to data from research firm MSCI Real Assets. Through a spokesman, Draper & Kramer confirmed the sale but declined to comment further. Antheus Capital could not be reached for comment, and the company’s founder, Eli Ungar, did not immediately respond to an email Wednesday. CBRE’s John Jaeger and Justin

Puppi represented Draper & Kramer in the sale. Peter Marino, a vice chairman in the Chicago office of CBRE Capital Markets, arranged a nearly $33 million Freddie Mac loan for the acquisition. The sale expands Antheus’ South Side apartment portfolio, which now totals about 7,000 units, and is the investor’s second purchase from Draper & Kramer in recent months. Antheus Capital bought the 1,869unit Lake Meadows apartment complex in Bronzeville for $161 million in June. Draper & Kramer also sold the 1,675-unit Prairie Shores to a joint venture of Golub and Far-

COSTAR GROUP

New Jersey-based Antheus Capital bought the 24-story tower in the South Loop for less than the Chicago landlord paid to build it

2111 S. Wabash Ave.

point Development in 2019. The firm listed another large South Loop apartment tower, the 656-unit high-rise at 1130 S. Michigan Ave., at the same time it listed Aspire. That listing has been taken

off the market, Pete Evans of Berkadia, a commercial real estate services firm, confirmed. A Draper & Kramer spokesman did not respond to a question about the firm’s plans for that building. DECEMBER 18, 2023 | CRAIN’S CHICAGO BUSINESS | 3

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Comedy theaters in Chicago are still trying to rebuild from the pandemic Institutions like Second City and The Annoyance say comedy class enrollment and ticket sales remain down from 2019 Chicago’s comedy scene was once a late-night affair. On Saturday nights at Second City, the last show didn’t start until 1 a.m. At iO Theater on Clybourn Avenue, the comedians and employees would stick around until 3 a.m. The Annoyance Theater & Bar in Lakeview always scheduled its hottest show for the 10 p.m. slot, and another act started two hours later. Now, midnight feels late at the theaters, with emptying bars and thin crowds. The pandemic has changed the way Chicago’s comedy theaters do business, and operators say the new normal has yet to emerge. Show attendance and comedy class enrollment remain below 2019 levels at some theaters. That data stings in an industry that splits its revenue between the box office, enrollment and sales from the bar. Theaters are trying what they can to push those numbers higher. They’ve moved showtimes earlier, changed the format of their shows and deployed marketing techniques to recruit students. Ultimately, operators say they are fighting harder to get people into their theaters but have fewer marketing dollars to do so. “We’re constantly dealing with trying to figure out what’s making people come or not come, and it’s very hard to nail down,” said Jennifer Estlin, executive producer at The Annoyance. “The one thing I would say we have figured out is people go out earlier than they used to.” The Annoyance now sometimes pushes its 8 p.m. show up an hour. Ticket and bar sales still lag 2019 numbers. The theater closed its kitchen because it wasn’t profitable, and it’s toying around with streaming shows in a way that doesn’t hurt in-person

WTTW NEWS

By Ally Marotti

attendance. It also changed its model, running more shows at a time for a shorter duration, offering audiences more variety.

Making concessions The situation is not dire enough to force The Annoyance toward the brink of closure, but concessions must be made. Some actors are paid based on ticket sales. Business was so slow earlier this year, Estlin said she delayed a planned bonus for employees until she was awarded a grant. “That’s not a great way to have to do business, just to hope and pray on grants,” she said. Theaters of all types have struggled to recover from the pandemic, as patrons have been slow to return to in-person performances. The theory is that people prefer to stay home, stream Netflix and go to bed early. Chicago’s theaters have not bounced back as fast as music and dance venues, perhaps due to the complexity and expense needed to produce plays. Additionally, donations have not

kept pace with inflation and subscription rates have declined, Crain’s reported last month. Comedy outfits can be nimbler than theaters that plan far in advance and stage long runs of plays. Sketch and improv shows don’t run as long, so a comedy theater can cut it short if tickets aren’t selling well. They also are not as dependent on season ticket sales, which patrons have become more reluctant to purchase post-pandemic. People still hesitate to make long-term plans. Comedy theaters also have a revenue stream that other theaters don’t: sketch and improv classes. While the shows draw tourists to the city, those classes lure aspiring comedians to move to Chicago. Stars such as Amy Poehler and Stephen Colbert trace their comedic roots to the city. Many students work their way through the classes at several theaters, going to the shows there, learning and performing themselves. Operators say class enrollment has not recovered from the pan-

demic, either. The Annoyance reports enrollment is down 17% from 2019. Steve Plock, general manager at iO Theater, estimated its enrollment is only about 50% of 2019 levels. Plock said the theater is advertising to potential students. It is also working to bring back other revenue streams, like hosting corporate groups in the theater’s event space. “We have a big building and a big space, and we want to fill it,” he said. “We just want to get back to where we were pre-COVID.”

A new chapter The iO Theater reopened about a year ago under new ownership. Its co-founder closed it permanently in June 2020 and put the theater up for sale. About a week prior, Second City had put itself up for sale, too. The announcements marked a new chapter for Chicago comedy. IO’s co-founder had run the theater for four decades. The former Second City owner had also been involved for decades. At the same time, Chica-

go’s comedy performers called for major efforts to improve diversity and equity at both theaters. Ultimately, Chicagoans Scott Gendell and Larry Weiner bought the iO Theater building and brand in 2021. They did some renovations and reopened the theater in November 2022. Second City’s new owner is New York-based private-equity firm ZMC. It is focusing on geographical expansion for the nearly 65-year-old comedy institution: Second City is set to open a Brooklyn location early next year. Some industry members say the new ownership of the city’s comedy giants was a chance to bring change and growth that was needed in the community. Though there is still discourse. The union representing teachers, facilitators and music directors at Second City said late last month said that it might go on strike if an agreement isn’t reached soon. The union — the Association of International Comedy Educators — was formed in 2021 and is still negotiating its first contract, according to a news release from the union. While big theaters were shuttered or changing hands, smaller outfits — such as Logan Square Improv and Clash on Clark — were gaining prominence and creating other opportunities for people to perform. Chicago’s comedy scene has shifted to smaller stages. Julia Morales founded Stepping Stone Theater in late summer 2020 to try to create more opportunities for diverse comedians. The nonprofit theater doesn’t have a physical space; it runs training programs out of other theaters. Morales said she’d like to see more inclusivity instilled at Chicago’s comedy institutions as they build back from the pandemic. “There’s still a lot of work to be done,” she said.

City again asking for offers on historic Stock Yards Bank building Completed in 1925, it needs an extensive rehab but should be put back into use, says new Chicago Planning Commissioner Ciere Boatright By Dennis Rodkin

City officials are reigniting their effort to get someone to revitalize the old Stock Yards Bank building, an oversized replica of Philadelphia’s Independence Hall that towers over Halsted Street south of Bridgeport. “This is the right time, with the mayor’s commitment to holistic development across all neighborhoods,” said Ciere Boatright, whom Mayor Brandon Johnson tapped in October as the new commissioner for the Chicago Department of Planning & Development, or DPD. 4 | CRAIN’S CHICAGO BUSINESS | DECEMBER 18, 2023

“We want to put this vacant building — it’s been vacant for 50 years — back to use,” Boatright said. “It’s an awesome opportunity to bring economic development” to the area around the old Union stockyards just south of Bridgeport. The 35,000-square-foot Stock Yards Bank building was completed in 1925 at 4150 S. Halsted St. The asking price is $1.9 million. Development proposals are due Jan. 12. Boatright said city officials have no specific preference for a use type, such as housing or office space. “We’ll see what the proposals are,” she said.

Also available is an empty lot across the street, a little under an acre where the Stock Yard Inn stood from 1913 until it was demolished in 1971. Boatright said potential developers can apply to buy the bank building with or without the empty lot, but cannot buy the lot separate from the bank.

Spur for redevelopment In 2000, the city acquired the already-vacant bank for $200,000 through eminent domain to prevent demolition. Since then, several efforts to get the building, which the city designated as a landmark in 2008, back into use

have failed to launch. Notable among them were City Hall’s 2006 pitch to get it reused as a banquet hall and steakhouse, and a 2017 concept from architect Helmut Jahn’s firm to make it into an “energy bank” generating renewable energy for nearby businesses. One likely obstacle to redevelopment is that the building is essentially a shell, its handsome red brick exterior and tall spire concealing an interior that has been stripped nearly bare. That’s seen in the interior photos in this 2020 story on the building by WBEZ. A spur for redeveloping the site could be the recent news that another long-empty 1920s building on Halsted, the Ramova Theatre

not even a block north, is undergoing a thorough rehab by an investor group that includes Jennifer Hudson, Chance the Rapper and Quincy Jones. Almost a century ago, the Stock Yards Bank, founded in 1868 and also known in the past as the Live Stock National Bank, spent $500,000 — the equivalent of nearly $9 million in today’s dollars — to build its new fireproof bank building near the entrance to the vast Union stockyards. With the Tudorstyle hotel, it presented a sophisticated gateway to the 375-acre stockyards packed with over 100,000 animals at a time. The bank was designed by architect Abraham Epstein. It closed in 1965 and the stockyards closed in 1971.

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THE TAKEAWAY

A Chicagoan to know: Hermilo Hinojosa After two decades at the Boys & Girls Club of Chicago, Hinojosa, 52, was named founding Executive Director of GreenLight Fund Chicago earlier this year, overseeing a $6 million budget. The Boston-based GreenLight Fund is a national nonprofit that each year identifies community needs and works to address them. Hinojosa and his wife live in the home where he grew up, in the Tri-Taylor neighborhood on the Near West Side. They have two children, ages 21 and 18. I By Laura Bianchi How do you identify Chicago’s needs?

said, “If we don’t do this, who will?” I stayed for 20 years.

The real magic is having hundreds of conversations with people across neighborhoods and leaders across sectors, as well as examining public reports. There are so many barriers affecting families here. Gun violence. Disparities in education. We narrow them down and bring the best nonprofit programs to the city to address them.

A rewarding experience?

Tell us about growing up in Tri-Taylor. We had our fair share of gangs, drugs and violence. Once, when I was 6 years old, I stepped out of my house to go to school and saw yellow police tape three doors down. A neighbor had been shot and killed on his own front steps. How did you avoid trouble? I think the gangs realized that I wasn’t cut out for that life. I was known as a good student, not a tough guy. When did you become an activist? At the University of Illinois, I participated in some protests, sit-ins and administration meetings to address the lack of students from Chicago’s inner-city neighborhoods. Your first job? Selling Christmas cards door to door at age 5. My mother was able to bring home discards from the printing press where she worked, and I tried to sell them for $1. If someone hesitated, I knocked it down to a quarter. An experience you’ll never forget? Five days into my job at the Boys & Girls Club, at age 25, we were getting ready for Friday night activities when we heard a barrage of bullets outside. My colleague and I ran to a window and saw a young boy crumpled on the ground, shot in the stomach. What happened? My co-worker told me that we had to go outside and get him. I was stunned, but we pulled him in and called 911. As my adrenaline began to wear off, I told my co-worker, “I’m not sure I can do this job.” And he 6 | CRAIN’S CLEVELAND BUSINESS | DECEMBER 18, 2023

Years ago, we had a teen mom and high school dropout who finished school with us at Latino Youth High School. She then got married and eventually started a business. This past fall, her daughter entered Loyola University on a full-ride scholarship. Breaking generational cycles of poverty like that is what I hope for, and it’s what drew me to GreenLight.

CHICAGO BOOTH INSIGHTS

For startup founders, this is the classic dilemma

The story The story should frame the narrative of the unmet need, the

ing on time and on budget while adding value, so investors will be enthused about the next round. It is not wise to raise more money than necessary for each stage.

Dr. Steven Gould is consulting director for Polsky Science Ventures at Chicago Booth and is responsible for leading the formation and launch of new science-based ventures from University of Chicago faculty research.

The next round

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recently met with a researcher who has identified multiple novel drug targets that may allow the development of new therapies to improve the outcomes of several diseases with no good current treatments. It was an exciting conversation that quickly led to a discussion around forming a biotech startup and raising $50 million as the initial round of financing. And then reality struck: Was that a realistic plan? Does a biotech startup need that much at this stage? Will it result in majority ownership by the investors and dilute the founder(s)? This is the classic dilemma faced by every founder, no matter the sector: How much to raise and when to raise it? I am surprised how few founders think strategically about the right amount of capital for initial financing. The critical task is to craft the story around the startup, identify the milestones that must be accomplished to raise the next round at a higher valuation, and determine the timelines and the right amount of money to achieve those milestones — all while factoring in the existing funding environment.

unique solution, the existing evidence that validates the proposed solution and the business opportunity that comes with successfully developing this scientific discovery. Think of the mRNA research that enabled the extraordinary clinical and commercial success of COVID vaccines within one year of the onset of the pandemic. The story needs to be sufficiently compelling to attract investors.

The milestones For biotech companies, the milestones to get from the bench to the bedside are crucial. Getting into

clinical trials is the most important step to discover whether the product will be safe and effective. The early biotech pre-clinical and clinical milestones for FDA approval are well known to biotech investors and should guide the plan.

The amount of money and the timeline Rather than beginning with a plan to raise $50 million, the story should precisely define the amount of money and time needed for each of the critical milestones. Each milestone achieved should demonstrate capability of execut-

You will always need the next round. But the other key element often overlooked by founders is factoring in the time to complete the next raise. It takes up to six months to complete any venture financing. If you spend the last dollar completing the final milestone without proper positioning for the next stage, things will come to a crushing halt. This is the art of raising capital at this early stage.

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

The funding environment Most of the steps above are in the founder’s hands. The wild card is the broader funding environment. We are in a very challenging time for venture funding. According to PitchBook, third-quarter 2023 deal value fell to the lowest figure since second-quarter 2018, and first-quarter pre-seed and seed activity slumped to a 12-quarter low. Yet as challenging as this may seem, founders should not be discouraged, as there is a huge amount of dry powder sitting on the sidelines with VCs waiting

for the right opportunities. I remain an eternal optimist: Great ideas that solve great problems will always attract thoughtful investors. But the same intellectual rigor, discipline, planning and execution that leads to cuttingedge scientific discoveries must be applied to the business of raising capital to deliver those discoveries to the world.

NOTABLE LEADERS IN SUSTAINABILITY Nominate a leader who leads sustainability initiatives at an organization and makes an environmental impact.

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DECEMBER 18, 2023 | CRAIN’S CHICAGO BUSINESS | 7

By Danny Ecker

Six months after it warned investors about its ability to stay in business and said it was paying to get out of its massive headquarters lease, Groupon has signed a deal for a new — and much smaller — main office in the Loop. The online-deal company confirmed it is subleasing about 25,000 square feet in the office tower at 35 W. Wacker Drive, where it will move in January from its nearly 300,000-square-foot headquarters at 600 W. Chicago Ave. Groupon is subleasing the Wacker Drive building’s 25th floor from media conglomerate Publicis Groupe, which has been trying to offload more than half of its massive office in the 50-story tower. The short-term sublease deal — Groupon has signed on for just 22 months, according to a spokesman — comes as the company nears the end of its lease at 600 W. Chicago. Groupon disclosed in May that it paid a $9.6 million fee to termi-

nate its deal at the end of January 2024, two years before it was due to expire. Groupon also disclosed at the time that there was substantial doubt that the company could remain a “going concern,” raising questions about whether it would need office space at all.

Small consolation For downtown office landlords, the sublease helps take a small chunk of available office space off the market, but it’s only a small consolation as they grapple with record-high vacancy. The decimation of Groupon’s office footprint is one of the most stark examples of big companies cutting back on workspace over the past few years. Fueled mostly by the remote work movement, office supply and demand have been pushed so far out of balance that a historic number of big office properties downtown are in distress, collectively threatening the vibrancy of Chicago’s urban core. In a statement to Crain’s, Grou-

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pon interim CEO and board member Dusan Senkypl said the company “has always had a thriving office culture, and this move to a space that is better aligned to our new hybrid working ethos is a great step to kick off 2024 for our Chicago team.” With its core business of discounts for brick-and-mortar merchants struggling during the COVID-19 pandemic, Groupon moved to reduce its costs with two waves of layoffs over the past 15 months that cut a total of about 1,000 jobs. It’s unclear how many employees the company has in Chicago today. The company’s stock price has recovered somewhat since its warning to investors sent shares below $3 apiece in mid-May. Shares closed yesterday at $10.92. Groupon reported a net loss of $81.4 million during the first nine months of this year, a big improvement from a $180.1 million loss during the same period in 2022 but still far from the $90 million in net income it reported during the first nine months of 2021, according to regulatory filings. Publicis Groupe earlier this year put 350,000 square feet of its

block of available office space on the secondary market. A Publicis Groupe spokeswoman declined to comment. Jones Lang LaSalle broker Andy Strand negotiated the new sublease for Groupon. Cushman & Wakefield’s Steve Schneider is marketing the 35 W. Wacker space for Publicis Groupe.

Wacker Drive office up for sublease, more than half of the 685,000 square feet it leases in the building on a deal that runs through the end of 2030, according to marketing materials. At the time, that offering surpassed Groupon’s 291,000-square-foot sublease listing for its 600 W. Chicago offices as the city’s largest

After strikes, Dick Wolf’s Chicago franchise reawakens ‘Chicago Fire’ and its sister shows resumed shooting last month By Brandon Dupré

Wolf Entertainment’s One Chicago television shows are ramping back up as the city’s film industry lands its first major productions following the Hollywood writer and actor strikes that halted the industry for months. “Chicago P.D.,” “Chicago Med” and “Chicago Fire” all resumed shooting at the end of November, eyeing a season premiere on Jan. 17, providing unions and industry workers in Illinois a shot in the arm before the holidays and the promise of a busy new year. “We needed to get back to work, it’s the medicine the entire industry needed,” said Anthony Barracca, secretary treasurer of the IATSE Studio Mechanics Local 476, which represents industry workers who supply the sets, lighting and makeup for the state’s film and television productions.

Economic fallout Over the summer, two of Hollywood’s largest unions representing industry writers and actors went on strike over contract negotiations with major studios, bringing the entire entertainment industry to a stop. On Nov. 8, the second of the two unions reached a tentative agreement, putting to end what was, at nearly four months, the

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The company is moving in January from its massive longtime home at 600 W. Chicago Ave.

35 W. Wacker Drive

WIKIPEDIA

Groupon signs deal for new Wacker Drive HQ

longest strike ever for film and television actors. The Writers Guild of America, or WGA, ratified their new contract in October. A Crain’s analysis estimated the economic fallout from the Hollywood strikes has the potential to cost Illinois as much as $500 million in lost expenditures from the film and television industry as it remained on hold during the busiest production months of the year. On top of that, many union workers have been without jobs. The strike sidelined some 2,000 full-time and part-time members of the Local 476 and around 5,500 actors and writers in the Midwest, according to union leaders. But with the strike now over, Chicago is getting back to work and is ramping up faster than just about anywhere else in the country, Barracca said, adding that about 50% of the Local 476 are now back to work. While production before the holidays is welcomed, industry

observers expect the real bulk of television and film production to come following the new year, when productions won’t be interrupted by the holiday break. In a statement, the Illinois Film Office said that it is “confident” the state’s film industry will “continue building and come back strong in 2024.” Barracca said that he expects there to be up to 10 shows filming in the first quarter of 2024, up from seven shows during that same period last year. “The Chi” is currently in preparation and set to begin filming in December, according to Barracca, with the “The Bear” and the comedy “Deli Boys” both slated to begin shooting in January.

Studio operations The resumption of production is also welcome news for Chicago’s newest film and television production facility, The Fields Studios, a $250 million project set to open in the spring on a 21-acre campus at Diversey Avenue and Pulaski Road. A prolonged strike could have affected the studio’s ability to book productions in advance, a spokesman for The Fields Studios told Crain’s. Chicago’s largest studio, Cinespace, is also back to work with the One Chicago collection resuming filming there.

Historic Little Village theater’s owners seek landmark status They want the Apollo’s 2000 recognized for its ornate architecture and as a sort of monument to the U.S. as a land of possibilities The longtime owners of a grand old movie palace in Little Village want to get it declared a Chicago landmark, both for its ornate architecture and as a sort of monument to the U.S. as a land of possibilities. “This is the epitome of the American Dream,” said Evelyn Stell, whose Mexican immigrant parents have operated the Apollo’s 2000, formerly the Marshall Square Theatre, since 1988. “Two young immigrants walked into a world of possibilities and built their business,” Stell said. “You hear about these stories, but my parents have lived it.” Lidia and Javier Galindo were immigrants from Durango, Mexico, in their 20s when Javier renovated the crumbling old movie theater, a candidate for demolition, into a nightclub in 1988. Later that year, they bought it. In the ensuing 35 years, they’ve hosted wrestling matches, quinceañeras, former presidential candidate Al Gore, architecture fans and, in their early days, the Mexican rock stars Maná. They’ve also raised three daughters, one now an attorney, another a pharmacist and the third finishing up her college education. “This is exactly what this country is built on,” says Stell, the attorney daughter. The family recently presented their building to the Commission on Chicago Landmarks for preliminary landmark recommendation, the first step toward an official designation. There’s likely to be little opposition, as the building owners clearly support the designation. If it comes, landmarking has not only a symbolic but a practical side, Stell said. Maintaining the monumental brick and terra cotta facade is “a financial hardship” for the family, she said. But with landmark status, they’d be able to seek funding through the city’s AdoptA-Landmark Fund and other grants. Scaffolding now lines the sidewalk on Cermak Road in front of the building as workers repair some of the terra cotta on the upper facade. Keeping the building in good shape, though costly, is part of “being an anchor for this business district,” Stell says. Further restoration, Lidia Galindo says, would help the family “open out more to the city.”

Neighborhood draw Fully restored, the building could become “not only an anchor but a catalyst,” Stell said, by hosting events that draw people from across the city who would spend money in the neighborhood’s other businesses. Designed by architect Alexan-

DENNIS RODKIN

By Dennis Rodkin

der Levy and built in 1917 for both vaudeville and movies, the 1,350seat Marshall Square Theatre was an anchor for the community that was then called South Lawndale. Mike Royko worked there as an usher when he was young and wrote about it at least twice when he was the city’s best-known newspaper columnist, in 1986 and again in 1997, a few months before he died.

easily, Javier Galindo said. “We love this building. It speaks to me.” Though they haven’t shown movies, the Galindos have preserved the trio of historical projectors in the projection room, hefty metal machines with exhaust hoses running to the ceiling. Out front

stands the old ticket booth wrapped in metal scrollwork. They’re all part of the history enshrined during the Galindos’ 35 years in the building. Stell demonstrates that she inherited her parents’ love of the old theater’s historical details

when she points out that the tall blade sign on the front of the building, added in the 1930s, is supported by a beam that tunnels into one of the huge plaster medallions on the front. “We inherited that,” Stell says. “My family didn’t do that.”

Family history The Galindo family’s history with the theater stretches back to early 1967, when Javier Galindo arrived in Chicago with his parents on a train from El Paso shortly after the historic January blizzard. They arrived on a Thursday and on Sunday went to the neighborhood theater, the Marshall Square, to watch “black and white Mexican cowboy movies,” he recalls. Twenty-one years later, married to Lidia, who came up from Mexico with her parents at age 16, Javier Galindo was a musician managing a dance club when the Marshall Square’s owner asked if he could turn the shuttered, rundown theater into a dance club, too. “I went home and told Lidia I found what I really wanted to do,” he recalls, “and she said to do it.” They’ve held on since, despite, according to Stell, a failed 1990s business plan that focused on Hispanic dances and concerts. By the end of the decade, she says, “we reinvented our business plan and began to host private events,” such as weddings and quinceañeras. The primary change the Galindos made to the building came early: ripping out the theater seats and replacing the sloped main floor with level floors for dancing, seating and a bar. Otherwise, they were careful to protect the building’s vintage details. In particular, they mounted all screens, speakers and other technical equipment on the plaster walls, never on the ornate gold piping and other trim that runs through the building. “You can patch the plaster, but you can’t replace the gold trim” as

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From

EDITORIAL

Chicago’s selective-enrollment schools are a civic asset worth saving

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t’s no secret: When he campaigned for his current job, Mayor Brandon Johnson emphasized a view — shared by his Chicago Teachers Union backers — that Chicago Public Schools’ neighborhood schools need to be reinvigorated. On the campaign trail, Johnson likened the city’s school choice system to a “Hunger Games scenario” that forces competition for resources and ultimately harms schools and students alike. As any parent with kids in the CPS system can attest, the process of applying for high school in this city can be nearly as stressful as applying for college. It’s an unfortunate byproduct of Chicago’s selective-enrollment schools, a system that has its roots in the second Daley administration. But along with that sometimes nervewracking process has come the creation of 11 high schools scattered throughout the city, spanning from Northside College Prep in the Hollywood Park neighborhood to Whitney M. Young on the Near West Side to Gwendolyn Brooks in Pullman, all delivering world-class, college-level education to a wide swath of public school students, tuition-free. It’s a system that, despite its flaws, has undoubtedly helped to create academic opportunities for a range of young people, launching them into college and careers. And, almost as important, it’s given middle-class families a reason to come to and remain in Chicago rather than de-

camp for the suburbs in search of better resourced schools when their kids get to high school age. And that, in turn, has helped to stabilize many neighborhoods and revitalize many more — though of course the positive effects have not always extended to every corner of the city. Against this backdrop comes news that the Chicago Board of Education intends to explore a move away from selective-enrollment schools — though officials are quick to stress that their Dec. 14 vote is meant to kick off a community-level discussion. District leaders want to ensure “fully resourced neighborhood schools, prioritizing

schools and communities most harmed by structural racism, past inequitable policies and disinvestment,” in the district’s words. The school board aims to pursue that policy goal as part of its five-year strategic plan, which will be finalized this summer. As Chalkbeat Chicago reports, CPS CEO Pedro Martinez, board President Jianan Shi and board Vice President Elizabeth ToddBreland declined in an interview to specify changes or say how much they want to move away from the choice system, saying they want to collect community feedback on how far the district should go. That said, it’s possible to read between the

lines of the just-adopted resolution: The CTU and like-minded supporters aren’t fans of selective-enrollment schools in particular or school choice in general. Unfortunately, abolishing such schools would deny parents the ability to choose which one meets the needs of their children, creating a significant barrier to the equity and fairness the union and its supporters say they’re striving for. It’s hard to argue with the stated premise of the board’s resolution. Yes, neighborhood schools need fixing, and all CPS students deserve a fair shot at a highquality education, no matter where they live, what resources they have, or what impediments stand in their way. But undoing the legacy of outstanding high schools such as Walter Payton, Jones, Lindblom or Lane Tech — which, like others in the selective-enrollment system, consistently rank among the best high schools in the entire state and sometimes the nation — would be a wrongheaded move that would have dire consequences well beyond the classroom. These schools have enhanced the quality of life in Chicago for countless students and families and have become a hub of community in neighborhoods across the city. They have also helped make Chicago Public Schools an attractive option for parents who might otherwise seek greener pastures beyond the city limits. The Board of Education should think carefully before dismantling these prime civic assets.

PERSONAL VIEW

This is a powerful solution for climate change

“C

sult is incredibly healthy, carbonommon Ground,” a new rich soil and food loaded with nudocumentary about retrients, minerals and vitality. generative agriculture, The system is also highly profitis selling out showings across the able. According to Spins, the country with this primary mesChicago-based company that is sage: Growing food using regenerthe leading source of data in the ative methods is a powerful solunatural products industry, regention for climate change. erative products have been growThe world is suffering yet aning at more than 20% for the past other drastic weather year with Jim Slama is year. They align perfectly with the massive heat waves, droughts, managing desires of the values-oriented floods and wildfires. It can feel as director of consumer seeking products that though there is little hope in sight Naturally are better for themselves and the to solve climate change. Chicago, the planet. Yet “Common Ground” offers a association of Simple Mills, one of our resimple message: Let’s grow nutri- the natural ent-dense food in a manner that products indus- gion’s standouts in producing packaged goods with regenerasequesters vast amounts of car- try in the tively grown ingredients, embodbon in our soil. According to the region. ies this movement. Simple Mills Rodale Institute, if we converted all global croplands and pastures to regen- has become the market leader in nutrierative and organic, we could sequester ent-dense crackers, baking mixes and more than 100% of current annual CO2 cookies that are gluten free and often oremissions. Farmers using these practices ganic. Founder and CEO Katlin Smith has grow organically, using crop rotations, cov- built an amazing team of experts who emer crops and, in many cases, rotational bed sustainability into all aspects of prodgrazing of livestock and/or poultry. The re- uct design.

Said Christina Skonberg, Simple Mills’ head of sustainability and mission, “We design all our new products with an eye toward diversifying consumer diets and agricultural ecosystems by utilizing a wide variety of ingredients beyond the most dominant crops in our food system.” They work directly with farmers who prioritize regenerative principles and incentivize positive ecosystem outcomes. Priority crops include almonds, cocoa, coconut sugar, sunflower and even squash, buckwheat and flax. Chomps is another Chicago-based company and utilizes regeneratively raised beef in its meat snack products. “All of our beef is sourced from cattle that are certified humane, grass-fed and grass-finished and follow rotational grazing methods,” says Rashid Ali, co-founder and co-CEO. “Because of our rapid growth, we are adding farms that are regenerative organic certified and/or land to market certified. These are considered to be the gold standards of third-party certification for ranchers.” Ali adds: “Grass-fed cows produce much higher levels of omega-3 fatty acids, which

Write us: Crain’s welcomes responses from readers. Letters should be as brief as possible and may be edited. Send letters to Crain’s Chicago Business, 130 E. Randolph St., Suite 3200, Chicago, IL 60601, or email us at letters@chicagobusiness.com. Please include your full name, the city from which you’re writing and a phone number for fact-checking purposes.

are critical for heart and brain health. Grassfed beef is also leaner than conventional beef and has higher levels of antioxidants.” Fulton Market-based Vital Proteins became the market leader in the collagen category in part by stressing that their cows are grass-fed and raised on pasture. Rotational grazing on pasture is an essential tool to restore degraded grasslands. According to the USDA, this practice improves soil structure and limits erosion, makes land drought resistant, reduces costs and increases profit, produces healthier animals and sequesters large amounts of carbon in the soil. Chef Rick Bayless, a fan of regenerative farming, is a longtime customer of Indiana rancher Greg Gunthorp, who produces pastured pork, lamb and turkeys. Gunthorp recently contracted with BP to pasture his sheep on a 900-acre solar site. The sheep will be rotated daily to control vegetation without a lawnmower in sight. It’s truly a regenerative win-win, with some of the best-tasting meat around. See CLIMATE on Page 11

Sound off: Send a column for the Opinion page to editor@chicagobusiness.com. Please include a phone number for verification purposes, and limit submissions to 425 words or fewer.

10 | CRAIN’S CHICAGO BUSINESS | DECEMBER 18, 2023

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Small to medium-sized farms have taken the lead in adopting regenerative practices, but Big Food companies are embracing regenerative at scale. General Mills has a goal to advance regenerative agriculture on 1 million acres of land by 2030. Cargill is “committed to support farmerled regenerative agriculture practices and systems across 10 million acres of agricultural land in North America by 2030.” Danone has already transitioned most of its milk sourced in France to regenerative production and is working across its global supply chain, including in the U.S., to transition farmers to regenerative practices. Regenerative agriculture is also driving one of our region’s biggest food trends: the increased production of grain, including delicious and highly nutritious artisanal and heirloom varieties, that is grown organically. Harold Wilken, owner of Janie’s Farm and Janie’s Mill in downstate Danforth, was ahead of his time in 2005 when he abandoned conventional agriculture and started growing and milling organic grain. Today, his products are used in leading bakeries and food processors in Chicago and beyond — Publican Quality Bread and Jenny’s Tofu are just two of his customers — and he has played a pioneering role in persuading a growing number of farmers to follow his model. The Chicago area is home to two leading pasta companies utilizing regeneratively produced ingredients. In Northbrook, Barilla’s legume pasta line uses lentils and chickpeas, great rotational crops that add diversity and natural nitrogen to the soil. Bartlett-based Rana Meal Solutions sources organic wheat for its line of fresh pastas in their club, retail and foodservice channels. Chicago-based Yishi Foods uses organic and sustainably grown oats for its innovative line of oat cereals and spreads. Quaker and parent company PepsiCo are moving toward regenerative oat production in partnership with Walmart and Archer-Daniels-Midland, creating a major global initiative to encourage farmers to adopt regenerative practices. According to Bill Weiland, CEO of South Barrington-based Presence Marketing and a leading prognosticator of food trends: “Oats are a leading regenerative grain. They are an excellent cover crop that also are a great cash crop for farmers in a rotation. Companies like Oatly have grown quickly and are now focusing on moving their supply chain to source regeneratively grown oats. This will have a dramatic impact on nutrient density while sequestering vast amounts of carbon in the soil.” “Common Ground” is a master class on how regeneratively grown food uses ancient techniques to build soil. With narration by Hollywood stars including Jason Momoa, Laura Dern, Rosario Dawson and Woody Harrelson, filmmakers

Josh and Rebecca Tickell demonstrate ways farmers can build healthy soil, sequester carbon and make more money doing so. Farmer Rick Clark is featured in the film, which describes how he transitioned his 7,000-acre farm to regenerative organic. He’s the fifth generation of Clarks to farm the land, 100 miles south of Chicago and straddling the Indiana-Illinois border. Clark transitioned to organic production after experiencing massive amounts of erosion on his then-conventionally farmed land two decades ago. He now grows a diverse array of corn, soybeans, rye, wheat, oats, sorghum and peas, while also rotationally graz-

ing cattle and sheep. “While my yields are lower, I’m producing much healthier food without exposing my family to the toxic chemicals in conventional agriculture,” he says. “We are also sequestering vast amounts of carbon in the soil and have an incredible amount of resilience in the event of drought or massive storms.” As a result of this system, he hasn’t used any chemical inputs in years; in the film, he states that he saves more than $400 an acre doing so. And with more than $2 million a year in savings, it goes without saying that it is much easier for Clark’s farm to be profitable. “Now we just need to get my neighbors to convert.”

Regenerative agriculture is also driving one of our region’s biggest food trends: the increased production of grain, including delicious and highly nutritious artisanal and heirloom varieties, that is grown organically. BLOOMBERG

e s r , s e t n

PERSONAL VIEW

DECEMBER 18, 2023 | CRAIN’S CHICAGO BUSINESS | 11

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Condo where Mike Royko lived in the early 1980s is rehabbed, up for sale T

he condo where legendary newspaper columnist Mike Royko lived in the early 1980s, describing himself as “Condo Man” before reverting to his traditional “Bungalow Man” persona, is on the market after an extensive rehab. Cherie Berzon is asking $1.4 million for the four-bedroom condo in a mid-1920s Italian Renaissance-derived tower on Lake Shore Drive. Berzon bought it in 2020 from the woman who bought it from Royko in 1985. Listed with Lynn Kummerer of Luxury Living Real Estate, it came on the market Nov. 24. Kummerer’s listing nods to Royko’s time in the space with a photo in the listings of the 2018 book “The Best of Royko,” a collection of columns from his years at the Chicago Tribune, edited by his son David Royko. The cover shows a dapper Royko in a suit, tie and top hat leaning on an umbrella, an apt choice for what the Pulitzer Prize-winning columnist called his “Condo Man” years on Lake Shore Drive. The famously working-class Royko bought the sixth-floor condo in 1981, shortly after the death of his first wife, Carol. Royko wrote of his time there as an “anthropological study of those relatively new urban creatures, Condo Man, High-Rise Man, Lakefront Man, Health Club Man, Singles Bar Man and all the others.” He couldn’t do the study from afar, Royko wrote, but had to immerse himself in the culture, like an anthropologist exploring an unfamiliar people. He bought a fancy bike for riding along the lakefront, but wrote that he turned out to be too fat for it and joined the “New Vo Reesh Health Club.”

“From my living room window I had a splendid view of the sun coming up over the lake. . . .And over the Dopemobile, a camper that arrived in the park each morning to sell strange herbs and spices while a nearby policeman slipped tickets under windshield wipers,” Royko later wrote. It was while living there that Royko moved from the Chicago Sun-Times to the Chicago Tribune following press baron Rupert Murdoch’s purchase of the Sun-Times. Royko sold the condo in 1985. Cook County records show neither what he paid for it in 1981 nor how much he sold it for in 1985. “About a week ago the moving truck came, and I have reverted to my natural state of Bungalow Man,” Royko wrote in October 1985. The next year, he married his second wife, Judy, and, in 1992, they moved to Winnetka. Mike Royko died in 1997, and Judy Royko sold the Old Green Bay Road property in 2004. In a twist that the columnist, a devoted fan of the Chicago Cubs, might have turned into comedy, the Winnetka home where he lived out his days was later demolished and the site is now part of Cubs President Jed Hoyer’s $5.7 million, 1.4-acre estate. Three years ago, Berzon bought Royko’s former condo for $900,000, according to the Cook County Clerk’s Office. Her renovations included updating the electrical from antique cloth-wrapped wiring, replacing all 28 windows with modern insulated models and adding electric blinds to most of them, re-plastering walls and restoring a decorative plaster ceiling in the library. Kummerer declined to discuss the seller’s reason for moving.

12 | CRAIN’S CHICAGO BUSINESS | DECEMBER 18, 2023

VHT PHOTOS

The Pulitzer Prize-winning newspaper columnist lived in the four-bedroom on Lake Shore Drive, observing characters he called ‘Health Club Man’ and ‘Singles Bar Man’ before reverting to his preferred role as ‘Bungalow Man’ I By Dennis Rodkin

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ENTERPRISE | Over $1 billion annual revenue

MIKE CARR VP IT Clune Construction Company

ANDREW COLLYER CIO Fitch

GARRET FITZGERALD CDO Enru Logistics and Postal Optimization

MANOJ POONIA CTO Somatus, Inc.

TIM WALTER CIO Edward Don & Company

LARGE CORPORATE | Over $300 million annual revenue

MARK DAHLBERG VP IT Sysmex

PAUL HAISMAN CIO Rotary International

RAJ SAMPOORNAM SVP & CIO Byline Bank

PAUL SCHORR CIO Optimas Solutions

LACHLAN TIDMARSH SVP & CIO Blue Cross Blue Shield Association

CORPORATE | Up to $300 million annual revenue

JON BEYER CIO - Executive for IT & Digital Solutions Evangelical Lutheran Church in America

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ANIL CHOUDARY CTO Alliant Credit Union

NEIL GOODRICH Chief Innovation Officer Envista Forensics

AKSHAY PATEL VP & CIO College of American Pathologists

KHAN TRAN CTO Avante Health Solutions

12/5/23 2:07 PM

PEOPLE ON THE MOVE

Advertising Section To place your listing, visit www.chicagobusiness.com/peoplemoves or, for more information, contact Debora Stein at 917.226.5470 / dstein@crain.com

ACCOUNTING

BANKING

HEALTH CARE

LEGAL

ORBA, Chicago

Cornerstone National Bank & Trust Company, Chicago

Medical Home Network, Chicago

Benesch, Chicago

Medical Home Network (MHN), a nationally recognized non-profit dedicated to transforming care in the safety net, welcomes Henish Bhansali, MD as Chief Medical Officer. Dr. Bhansali brings deep experience in both value-based care and community healthcare to his role at MHN with more than 12 years of experience in healthcare management, medical education, and healthcare consulting. He will lead the efforts of MHN’s clinical team to empower health centers to provide whole person care for patients.

M. Reas Bowman has joined Benesch as a Partner in the firm’s Litigation Practice Group. Reas practices commercial litigation, primarily representing Bowman clients in disputes involving real estate and financial services. He represents national lenders, loan servicers, and debt buyers in disputes to enforce commercial loan agreements and defend lender liability actions. Collins Fiona Collins has joined Benesch as an Associate in the firm’s Litigation Practice Group. Fiona (Fi) has done extensive work in large-scale toxic tort litigation. His experience includes trial strategy, civil matters in state and federal courts, and active participation in the discovery process.

William E. Walsh has joined Benesch as a Partner in the firm’s Litigation Practice Group. Bill represents clients in the financial sector in litigation and regulatory Walsh matters. He has deep experience in complex commercial litigation and class actions, including matters related to securities fraud, market manipulation, auditor liability, and highfrequency trading. Cole Hardy has joined Hardy Benesch as Of Counsel in the firm’s Intellectual Property Practice Group. Cole is a seasoned technology transaction attorney with a passion for innovation and a keen understanding of the ever-evolving legal landscape in the technology industry.

ORBA, one of Chicago’s largest public accounting firms, welcomes Kaleb Spreitzer and Stephanie Becker to the firm. Kaleb joins ORBA’s Tax Group as a Tax Associate. He will Spreitzer be preparing state and federal individual income tax returns for clients. Stephanie Becker joins the firm’s Marketing Department as a Manager of Marketing and Business Development. Stephanie will be working with Becker practice and industry groups to respond to proposals and assists with the planning, development and implementation of a variety of marketing and business development projects and programs.

Cornerstone is excited to welcome Robert Conrardy, CFA, as Executive VP. Bob will oversee Wealth Management and Fiduciary Services. With over 35 years of experience, he has held several leadership and advisory roles at BMO, Bank of America, Savant, and Cargill and is active in Chicago’s start-up community. Bob earned an MBA from the Univ. of Chicago – Booth and a BBA from the Univ. of Wis.– Madison. Bob is a Governing Member at the Brookfield Zoo and active with WGA Evans Scholars Foundation.

LAW FIRM

BANKING First Bank Chicago, Skokie

ACCOUNTING / CONSULTING CLA (CliftonLarsonAllen LLP), Chicago Jim Milliken has advanced to principal at CLA. With over 10 years of leadership experience in private real estate development firms and property management companies, he works extensively with lenders throughout local and global institutions. Jim is also a leader in the real estate division of CLA’s outsourcing practice (BizOps) where his team of accounting professionals serve clients in various capacities from daily transactional recordkeeping to CFO-level tasks. Explore CLA at CLAconnect.com.

First Bank Chicago, one of Chicago’s top 5 privately owned banks, congratulates Simon Yohanan on his appointment as co-chair for the D’Vine Affair event hosted by Catholic Charities in February 2024. Yohanan, SVP/ Managing Director, Middle Market Banking, is one of many employees giving time, talent and resources to our community and neighbors as part of our bank-wide culture of caring. We applaud Simon’s efforts to assist Catholic Charities in meeting their mission of serving those in need.

CONSTRUCTION Clayco, Chicago

ARCHITECTURE Gensler, Chicago Bringing nearly three decades of experience in the design industry, Erik Lucken has returned to Gensler as Strategy Director. With a focus on workplace strategy, he partners with clients to explore opportunities to align the physical environment with work process, culture, and business performance goals. Specializing in applied research, Erik has extensively studied workforce demographics and the design imperative to support both how and why people work today.

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

P014_CCB_20231218_v3.indd 1

Clayco welcomes Marilynn Rubio, Executive Director of Civic and Social Impact. In her new role, Rubio will lead community engagement and philanthropy for both the company and the Clayco Foundation, dedicated to enhancing local communities. With 16 years of experience in community engagement and leadership roles, Marilynn aims to align giving, social justice, and community efforts with Clayco’s values, contributing to positive and lasting change.

Croke Fairchild Duarte & Beres LLC, Chicago Croke Fairchild Duarte & Beres welcomes Nancy Zhao to the firm as an associate, focusing her practice on mergers & acquisitions, asset purchases, venture capital financings, and securities offerings. She represents a range of clients from startups to public companies in both domestic and cross-border transactions. Nancy received her J.D. from Washington University in St. Louis School of Law, and also serves as a first violinist with the Chicago Bar Association Symphony Orchestra.

Ardmore Roderick, Chicago Ardmore Roderick, Illinois’ leading minorityowned infrastructure engineering firm is pleased to announce David Castañeda as Vice President of Aviation. With more than 22 years of global aviation experience, David has led major programs including landside and airside facilities and infrastructure projects. David will play an integral role in driving Ardmore Roderick’s nationwide aviation expansion.

Benesch, Chicago Ryan J. Levitt has joined Benesch as Of Counsel in the firm’s Litigation Practice Group. Ryan is an individual for whom criminal defense was always a calling. Whether it is defending the wrongfully accused, challenging government overreach, helping a client through one of if not the most difficult circumstances of their lives, or anything in between-he finds a passion and purpose in every case.

LAW FIRM

LEGAL

Hahn Loeser & Parks, Chicago

Benesch, Chicago

Hahn Loeser & Parks welcomed Ryan T. Johnson as a partner in its Litigation and Construction Practices. Johnson has over 15 years of experience representing clients in construction matters, professional liability, and complex commercial litigation in Illinois and nationally, including jury and bench trials in state and federal courts and arbitration proceedings. He earned his J.D. from Drake University Law School and received a B.A. in English from the University of Iowa.

Jane Moye-Rowley has joined Benesch as an Associate in the Firm’s Litigation Practice Group. Jane focuses their practice on complex commercial litigation in federal and state courts across the country. They have experience conducting critical legal research, drafting memorandums and motions, and appearing in administrative hearings.

Kabat Chapman & Ozmer LLP, Chicago

LEGAL Benesch, Chicago

LAW FIRM ENGINEERING / CONSTRUCTION

LEGAL

Michael Best & Friedrich LLP, Chicago Michael Best is pleased to announce the addition of Partner Andrew Shelby, further strengthening the firm’s deep Labor & Employment bench. With more than 15 years of experience, Andrew is a seasoned commercial litigator and trial lawyer who counsels clients on disputes involving employment issues, class actions and business torts, real estate and merger transactions, professional negligence, and breach of contract. Andrew joins Michael Best as the firm celebrates 175 years of legal excellence.

SaDella Duval D’Adrian has joined Benesch as an Associate in the Firm’s Litigation Practice Group. SaDella focuses on civil litigation and has experience drafting a wide variety of briefs, D’Adrian pleadings, motions, and written discovery. She previously worked at a legal center that provided services and support for refugees, asylum seekers, unaccompanied minors, and victims of violence. Meghan Golden has Golden joined Benesch as an Associate in the Firm’s Litigation Practice Group. With a concentration on civil litigation, Meghan brings considerable experience in drafting a diverse array of briefs, motions, and written discovery documents. She also conducts legal research to further facilitate the efficient resolution of legal disputes.

Rob Schnitz has broad experience and deep knowledge in the areas of hospitality law, labor and employment law, internal investigations and commercial law. Prior to joining KCO, he spent 22 years at Hyatt Hotels Corporation. Rob’s experience also includes negotiating complex commercial contracts, privacy, corporate governance, litigation, public relations, crisis communications, enterprise risk management, mergers and acquisitions, franchise matters, government affairs and business torts.

REAL ESTATE @properties Christie’s International Real Estate, Chicago @properties Christie’s International Real Estate is pleased to announce that Rachel Scheid has been promoted to Vice President of Brokerage Services from Vice President of Education. In her new role, Scheid will co-manage the brokerage’s Gold Coast, East Lincoln Park and Bronzeville offices, helping agents grow their business through @properties Christie’s International Real Estate’s innovative technology, marketing and coaching programs. She will also play a key role in agent recruitment.

12/13/23 10:17 AM

CRAIN’S VOTING AND DEMOCRACY

ELECTION SYSTEM MAKEOVER Voting reform initiatives in Illinois and elsewhere aim to give voters more say in the outcomes I By Judith Crown

oters in Evanston will see a new type of ballot in the city’s next local election that will allow them to rank candidates from highest to lowest preference. The method, called ranked choice voting, is designed to ensure that a candidate wins with a majority of voters. It also attempts to solve the conflict posed by third-party spoiler candidates. Evanston is the first Illinois municipality to adopt ranked choice voting, which is being used around the country for local and statewide elections as well as primaries. It was employed in the 2021 New York City mayoral election won by former police officer Eric Adams. And it generated national publicity when former Alaska governor and

vice presidential candidate Sarah Palin was defeated in her bid for a U.S. House seat. Under traditional systems, a candidate wins with a plurality — unless there’s a runoff — which means a majority of voters didn’t prefer him or her, says Andrew Szilva, executive director of the nonprofit FairVote Illinois, part of a national initiative advocating for electoral reform. In a ranked choice election, the last place candidate is eliminated, and his votes are redistributed to the voter’s second choice. It can require several rounds, but, ultimately, “the winner is supported by the majority,” Szilva says. For example, a supporter of Elizabeth

GEOFFREY BLACK

Tom Bowen is a Chicago political strategist.

What is ranked choice voting? The method is designed to ensure that a candidate wins with a majority of voters. It also solves the conflict posed by third-party spoiler candidates. Ranked choice ballot 1st choice

2nd choice

3rd choice

4th choice

Candidate A Candidate B Candidate C Candidate D

See VOTING on Page 20 SPONSORS

DECEMBER 18, 2023 | CRAIN’S CHICAGO BUSINESS | 15

CRAIN’S

VOTING AND DEMOCRACY I COMMENTARY

N T

vote, you benefit by gaining the recently had dinner with a loyalty of a passionate minority group of Illinois mayors, and who stick with you no matter conversation strayed to the what, while viciously attacking topic that often dominates when other credible candidates to municipal leaders get together: knock their performance down the divisive and toxic nature of tobelow yours (sound familiar?) day’s politics, and the frustration That is, our electoral system is we feel when that style gets in the designed to amp up negativity way of making the progress our Daniel Biss is and division. Fortunately, there’s residents expect. mayor of an alternative. In a democracy, the tone of po- Evanston. With ranked choice voting, votlitical discourse has two sources: the broader culture and the specific rules ers can rank the candidates. If one candiof our electoral and governing systems. date gets an absolute majority of firstUnfortunately, the cultural problem — place votes, they’re elected. But if not, the mostly resulting from digital technology votes of those who supported the lastand especially social media — is largely place candidate are reallocated to their beyond the authority of local government. second choices. This process repeats until The good news is that we can improve the someone gets over 50% and is named the winner. rules. Most American elections use the “first past the post” system, meaning that whoev- Disincentivize polarization er gets the most votes wins. That works well This system disincentives polarization in a two-candidate election, but it can result and rewards collaboration. Yes, candidates in strange outcomes with larger fields, like want to defeat their opponents. But they the seven-candidate 2010 Illinois Republi- also want to be the second choice of their can gubernatorial primary, which Bill Brady opponents’ voters, which discourages won with under 21% of the vote. trashing the other candidates. An election This system rewards polarizing behav- system that rewards candidates who behave ior. If you can win with a small share of the collaboratively will select public officials

ALAMY

Evanston adopts ranked choice voting. Illinois should, too. I

who conduct themselves in that way. That’s why I was delighted in 2022 when Evanston voters overwhelmingly passed a referendum establishing ranked choice voting for our municipal elections. Starting in 2025, we’ll elect our mayor and city council using ranked choice voting, and I expect that over time we’ll get a more collaborative, and therefore more productive, city government. By the way, acting collaboratively doesn’t put the thumb on the scale for any particular ideology. Evanston is an avowedly progressive community, and I’m an avowedly progressive mayor. I don’t demand consensus before taking action, and I’m not particularly enthusi-

astic about pushing people toward the center. The problem with the polarization gripping our politics is not that it blocks some hypothetical moderate consensus, but rather that it causes huge fights that paralyze our governments. To make progress, we need government bodies that are able to engage productively across difference. Whatever your preferred policy outcome, a government (or any organization made up of multiple human beings) will be most productive when it deals with disagreement honestly, respectfully and collaboratively. That’s what ranked choice voting encourages, and that’s why I hope it is adopted across Illinois.

elections.

once using a ranked ballot. We need healthy competition to lead our country — including regular intraparty competition between different flavors of Democrats and Republicans in November elections. With FFV for congressional and state elections, voters would choose from up to five credible candidates in each November race. Imagine a general election for the Senate with two Democrats, two Republicans and an independent. For presidential elections, instant runoff voting (minus the top-five primary) can deliver similar benefits. These are the hiring systems we need to deliver the best of the best to Washington, D.C., and state capitals and to hold them accountable for results.

able at the time: Britain’s countryn less than a year, it appears side district elections, which used likely that Americans will be plurality voting (i.e., the most choosing between two presivotes wins). That seems logical, dential candidates whom the mabut it’s a really bad idea. Why? In jority already don’t want. And plurality elections, a candidate many Americans are already far can win with far less than a majortoo familiar with feeling less than ity. For example, in any three-way happy with their ballot choices. race, one person can win with only How can this be? Katherine M. 34% of the vote. As a result, a vote If your company’s hiring prac- Gehl, former for a candidate unlikely to win, tices regularly delivered only two CEO of Gehl such as a Libertarian or a Green, finalists who were so undesir- Foods, is risks being “wasted” or, worse still, able as to create a “lesser-of-two- co-author of “spoiling” the election in favor of a evils” choice for your most im- “The Politics most-disliked candidate. That’s portant positions, what would Industry” and you do? Likely declare that your founder of The why third-party and independent candidates rarely get traction. company’s success depended on Institute for That’s why the two major parties winning the war for talent, create Political do everything they can to keep poa top-flight committee to urgent- Innovation. tential “spoilers” out of the race. ly delve into root causes, and Plurality voting is an almost insurthen design a new hiring system to ensure your firm competes for the best of the mountable structural barrier to entry for new competition, and when combined best. We’re losing the war for talent to run with our system of low-turnout party our country because our system of hiring primaries that often advance candidates and firing — our elections — is funda- with less appeal to the general electorate, mentally flawed as a result of a little- November voters will reliably be disapknown historical mistake. When our pointed. That is, until we use the power founders created the details of our elec- given each state, in Article 1 of the tions, they copied the only example avail- Constitution, to change the rules of our

16 | CRAIN’S CHICAGO BUSINESS | DECEMBER 18, 2023

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Here’s how to return healthy competition to our elections I

‘Laboratories of democracy’ The solution is a new election design called Final Five Voting (FFV), an earlier version of which is already in effect in one of our federal system’s valuable “laboratories of democracy” — the state of Alaska. FFV is the combination of two simple changes to our election system: open, topfive primaries that advance five candidates to the November election regardless of party, and instant runoff general elections, which guarantee majority winners. Instant runoffs are exactly like a series of physical runoffs except that instead of needing to repeatedly return to the polls for each round, voters cast all their votes at

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COMMENTARY I VOTING AND DEMOCRACY

ers may not know a new voting system was put in place and struggle to navigate a new ballot without any prior education or information. Lastly, since ranked choice voting would only apply to Oak Park board elections and not any other local elected boards, there was concern this would further complicate the ballot and voters would be dissuaded from voting altogether. Ultimately, the board paused further dis-

cussion while a state task force assesses ranked choice voting as a viable option in Illinois. While the future of ranked choice voting in Oak Park is unclear, the board firmly holds the right to vote as a cornerstone of democracy. The possibility that ranked choice voting might silence the voices of an electorate weighed heavily for a majority of village board trustees and can be expected to inform the board’s final decision.

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also clear the details still needed he village of Oak Park is a Chito be discussed with the county cago suburb that proudly touts clerk. Additionally, questions were a reputation of having a highly raised regarding the impact to earengaged electorate. With over 20 citily voting. As a community that sees zen commissions and six governing a fair number of early voters across boards, Oak Park’s style of governing 54 countywide sites, Oak Park votcan be described as collaborative ers would need special ballots and with many opportunities for residents to influence the political land- Lucia Robinson voting booths to process their ranked votes. With the uncertainscape. Recently, ranked choice vot- is an attorney ties surrounding new software and ing was proposed to Oak Park’s main and village of specialized equipment, ranked governing board as an alternative to Oak Park choice voting could present signifits current election process. This pro- trustee. icant operational barriers for Oak vided an opportunity to evaluate the importance of voter participation and access Park voters. The board discussion also highlighted in local elections. Ranked choice voting is an election pro- substantive issues starting with the referencess where voters rank candidates from most dum whereby voters would choose this new to least preferred. A candidate who secures a voting system. The timing of such a referenmajority of votes, wins a seat. However, if no dum, the 2024 spring primary elections or first choice candidate receives a majority, the the fall presidential election, was an importcandidate with the fewest first-choice votes ant discussion point. Board members voiced is eliminated and the ballots of the eliminat- strong support for the latter given higher voted candidate have their second-choice can- er turnout for presidential elections. didate counted. This process is repeated until all seats are filled. For Oak Park, it would Confusion and unease be a significant change from the current votIn addition, the draft referendum we were ing system, which elects board members presented raised concerns. It contained a based on a plurality of votes. nine-point explanation to describe the mulIn considering this proposal, the Oak tiple rounds of vote counting and candidate Park board noted several procedural chal- elimination. This was concerning for several lenges. While there was general agreement board members who noted the referendum that a software upgrade to the local county’s was long and potentially confusing. Furtherelection system would be required, it was more, there was general uneasiness that vot-

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ALAMY

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CRAIN’S

Working to advance racial equity and economic mobility for the next generation in the Great Lakes region.

+PZDF'EO PSH DECEMBER 18, 2023 | CRAIN’S CHICAGO BUSINESS | 17

CRAIN’S

VOTING AND DEMOCRACY

Voting and election reforms proposed as a remedy to unwieldy politics Amid hyperpartisanship, gridlock and polarization, momentum is shifting toward ways to better serve the interests of a larger share of the U.S. electorate I By Judith Crown

anked choice voting, or RCV, is a way of casting ballots that allows voters to rank candidates in order of their preference. But ballots in ranked choice voting elections are more complex than traditional elections where the winner only needs to garner a plurality. In traditional elections, every submitted ballot that follows the instructions is counted toward the final result. With RCV, votes are reallocated to second, third and fourth choices so that the winner achieves a majority. Election and voting experts acknowledge that no method is perfect. Hyperpartisanship, gridlock in Washington, D.C., and statehouses, and political polarization are reasons some say the traditional voting method needs to change and that RCV is the answer. Here’s a closer look at RCV, which has gained traction in recent years . How does ranked choice voting work? Votes are counted in rounds. In the first round, if a candidate earns 50% or more of the vote, he or she wins and the counting stops. If not, the candidate with the fewest votes is eliminated. Votes for the eliminated candidate are allocated to the voter’s second candidate choice or, subsequently, to his or her third- or fourth-choice candidates. This continues in rounds until a winner is identified with a majority of votes.

Are voters required to rank? There is no obligation to pick more than one candidate. Voters may rank as many as they wish. Are there secondary benefits to ranked choice voting? Proponents say ranked choice discourages negative campaigning because candidates are also looking for second-choice votes from their opponent’s supporters. Some candidates even campaign together. Proponents also maintain ranked choice voting has helped elect more women and people of color because voters have access to a wider range of candidates. Does ranked choice favor one political party over another? Losers in political campaigns have said the system favors the op-

posing party. But advocates say this type of voting is nonpartisan and has support in the major political parties, as well as among third parties and independents. Where is ranked choice voting used? Evanston adopted ranked choice for its municipal election in 2025. Nationally, it’s used in Maine and Alaska, as well as a number of municipalities, including New York City, San Francisco and Minneapolis. Is it possible that voters could face traditional and ranked choice on a single ballot? Voters could, and typically will, have both ranked choice voting races and plurality voting on the same ballot. Evanston, for example, will start using ranked choice voting for city elections. Voters there will rank the candidates for mayor, but will also have another page on the ballot where they vote

Do some groups object to ranked choice voting? Opponents say the method could be confusing and disenfranchises voters who are not well informed on all the candidates in the mix. What is a nonpartisan Final Four or Final Five primary election? Instead of a closed Democratic or Republican primary, all candidates appear on a single ballot, regardless of political affiliation. The final four or five finishers advance to the general election, which is determined by ranked choice voting, or what is also called instant runoff voting. What is the advantage? Proponents say the current system yields candidates who are extreme on either side of the political spectrum because the closed primaries attract the angriest and the most partisan voters. And because turnout in those primaries is low, it isn’t necessarily representative. The elected official ends up governing with the narrow, partisan base top of mind. What is the difference between a closed primary and open primary? In a closed primary election,

only voters registered with that party can participate. In an open primary, registered voters can choose which primary to vote in on Election Day, regardless of their registration. Under a Final Five system, all registered voters would be able to vote in a single open primary with candidates from multiple parties on the single ballot. Are the proponents of ranked choice voting and Final Five at odds? Advocates of Final Five say they are solving a more pressing problem and that ranked choice voting on its own is less impactful. In fact, they are addressing two concerns by using ranked choice in the general election. Ranked choice activists in Illinois say they’re not opposed to Final Five but are working to advance what is more politically feasible.

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Where is Final Four or Final Five voting used? Voters in Alaska approved a Final Four system in 2020, and it was first used in 2022 to fill the state’s only seat in the U.S. House following the death of Republican Don Young. There is a grassroots movement in New York City to adopt Final Five voting and in a number of states, including Nevada and Wisconsin. Sources: FairVote Illinois, Alaska Division of Elections, Final Five Voting NYC

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What is the benefit? Ranked choice voting ensures that a candidate is elected with a majority, not a plurality. Put another way, it eliminates the situation of more voters having opposed an elected official than supporting that person. By rank-

ing multiple candidates, voters have a greater say in who gets elected even if their top choice doesn’t win.

for their state representative using plurality.

18 | CRAIN’S CHICAGO BUSINESS | DECEMBER 18, 2023

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VOTING AND DEMOCRACY

CRAIN’S

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Cook County residents prefer to stick with the current way they elect candidates

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More than half agree that ranked choice voting is confusing and they are not ready to trust it

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ver the past 20 years, more and more jurisdictions across the country have moved to a ranked choice voting system. Minneapolis, New York City and San Francisco are among the cities that have made the change. Closer to home, Evanston will start using ranked choice in April. Could Chicago become the next major city to embrace it? Not immediately. In the short term, more public education and prep work needs to be done before such a move could plausibly be considered. According to a recent Harris Poll survey, only 20% of Cook County residents even knew that some state lawmakers had proposed implementing ranked choice in Illinois. While supporters had hoped the state would move to it by the 2024 presidential primary, less than half of Cook County residents (42%) were even somewhat familiar with the concept before being surveyed. Nationwide, few Americans are familiar with ranked choice voting and confusion about it is common. Locally, more than half of all Cook County residents (56%) agree that it is confusing. Even among the Cook County residents who claimed high familiarity with the system, 41% consider it confusing. While each jurisdiction’s ranked choice system may differ, the general idea is that rather than casting their ballot for a single candidate, voters would rank contenders for office in order of preference. A candidate who secures more than 50% of voters’ first-place picks wins. If no one does this, the candidate with the fewest number of first-place votes is eliminated and their votes are reallocated to the remaining candidates according to their supporters’ next choices. This process

William Johnson is CEO of The Harris Poll, a global public opinion polling, market research and strategy firm. continues until a candidate amasses more than 50% of the total vote. Ranked voting is polarizing. Opponents have nicknamed the system “rigged choice voting” and argue that it is too confusing and could increase distrust in the voting process. They also point out that it can end up redistributing votes to, and ultimately elect, less popular candidates. Alaska, for example, first used ranked choice in 2022 when three Republican House candidates in a special election garnered 60% of the vote, but a Democrat (who garnered a plurality in the initial tally) won the race because she was the second choice of enough of the also-rans’ supporters. Several states, including Florida, Idaho, South Dakota and Tennessee, have banned ranked choice voting outright. More states are expected to follow suit.

The costs of runoffs Proponents argue that ranked choice better empowers voters because it prevents relatively few voters from playing a decisive role in a crowded field. Take Chicago’s 2019 mayoral election, for example, which resulted in a runoff between Lori Lightfoot and Toni Preckwinkle. They amassed only 33% of the vote combined during the first round of balloting, meaning that two-thirds of Chicago voters had not voted for either candidate.

Ranked choice proponents argue that their system would have allowed those voters to have their second, and perhaps third, choices counted, thus better reflecting the will of the city. Ranked choice advocates also argue that it would eliminate costly runoff elections, saving an estimated $3 million annually, according to the ranked choice advocacy group FairVote Illinois. Eliminating runoff elections could also reduce voter fatigue: Many voters fail to return to the polls for runoff elections, especially if they are not enthusiastic about the remaining candidates. Support for ranked choice often falls along ideological lines. According to the Harris Poll survey, more self-identified liberal Cook County residents (44%) supported implementing such a system than self-identified conservative (28%) or moderate (28%) residents. Likewise, liberal (56%) and moderate (55%) Cook County residents report more often than conservatives (40%) that it would be an improvement on the current voting system. Overall, Cook County residents seem to prefer the status quo over transitioning to ranked choice. Sixty-six percent of Cook County residents said they were satisfied with the current voting system. When we asked directly about moving to ranked choice, a plurality (36%) were neutral about the idea, with a third (33%) supporting it and a quarter (24%) opposing it. The bottom line: It’s conceivable that as local voters learn more about ranked choice, support for it will rise. But right now, Cook County residents are too unfamiliar with it to properly evaluate such a system, or decide whether it is right for Chicago.

Harris Poll: Familiarity How familiar are you with the concept of ranked choice voting? At least somewhat familiar

Not very/not at all familiar

58%

42%

Harris Poll: Support Based on what you know, how much do you support or oppose implementing a ranked choice voting system during elections? Strongly support

Somewhat support

Strongly oppose

Not at all sure

Neutral

Somewhat oppose

12%

11%

21%

13%

36%

Source: Harris Poll • Cook County residents Note: These questions were asked prior to providing respondents with a high-level definition of ranked choice voting and therefore results reflect unaided familarity. DECEMBER 18, 2023 | CRAIN’S CHICAGO BUSINESS | 19

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VOTING AND DEMOCRACY

VOTING

consensus, because they are accountable to a broader and more diverse electorate, she says. Using more than $15 million from the 2015 sale of her family’s food business, Gehl is funding reform efforts in her home state of Wisconsin, in Nevada and in other state intiatives. She’s also raised money from business leaders on different sides of the political spectrum, including hedge fund billionaire Ken Griffin, a right-of-center political donor, and billionaire LinkedIn co-founder Reid Hoffman, who has favored Democratic causes. In the early 2000s, Gehl served as a special assistant to Chicago Mayor Richard M. Daley for technology economic development and is a former Crain’s 40 under 40 selectee.

From Page 15

Andrew Szilva is executive director of the nonprofit FairVote Illinois.

GEOFFREY BLACK

Warren in the 2020 Democratic primaries might think her vote didn’t count when Warren dropped out after Super Tuesday. But in a ranked choice election, that voter might have ranked Bernie Sanders second and Joe Biden third, giving her more of a say in the outcome. In the 2016 presidential election, votes for third-party candidates Jill Stein and Gary Johnson would have been reassigned to second-choice picks Donald Trump or Hillary Clinton, eliminating their spoiler effect. Ranked choice voting is part of a pro-democracy movement — initiatives aimed at moderating the chaotic and polarized state of politics. A recent study of the nation’s politics by the Pew Research Center found deep voter dissatisfaction. Only 4% of U.S. adults say the political system is working extremely or very well. A growing share of the public dislikes both political parties, and 63% of Americans say they are dissatisfied with the presidential candidates who have emerged so far. Other reform proposals outside of the voting process include term limits for members of Congress, age limits for elected officials and replacing the Electoral College with a popular vote for presidential elections. Advocates of ranked choice voting say this is an option that can engage voters and expand participation. The Illinois General Assembly is creating a 20-member bipartisan task force to assess county voting systems and determine what changes are needed to make them compatible with ranked choice. State Sen. Laura Murphy, D-Des Plaines, who co-sponsored a bill for ranked choice voting this year, hopes a system can be in place for the presidential primary in 2028. “We need a change that encourages more people to vote,” she says. Voters in west suburban Berwyn endorsed the concept of ranked choice voting in an advisory referendum last year. Trustees in the nearby village of Oak Park this fall considered a ballot referendum for the March primary but, instead, opted to wait for the state task force report. In Chicago, Ald. Matt Martin, 47th, earlier this year introduced a resolution calling for a hearing on ranked choice voting. Another even more ambitious reform has the potential to reduce the number of extreme candidates that emerge from party primaries and promote bipartisanship. Final Four or Final Five systems eliminate the party primary in favor of an open primary in which Democrats, Republicans and independents compete. The top four or five vote getters move on to the general election and compete in a ranked choice or instant runoff process. More than 80% of U.S. House races aren’t competitive, says Katherine Gehl, founder of the Chicagobased Campaign for Final Five Voting. House members from safe red or blue districts focus on primary

How Americans feel when they think about politics Percentage of those who feel each of the following emotions when thinking about politics these days. Always/often

Sometimes

Rarely/Never

No response

Excited 4%

18%

78%

Hopeful 10%

33%

56%

Angry 55%

34%

11%

25%

Exhausted 65% 0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Majority of Americans say partisan fighting gets too much attention, while issues and policy get too little Percentage of those who say the following level of attention is currently given to each topic in our county these days. Too much

Right amount

Too little

No response

Disagreements between Republicans and Democrats 57%

20%

22% 1%

37%

22%

64%

The 2024 presidential election 39%

Policies elected officials in Washington are working on 13%

20%

Policies local elected officials are working on 25%

66%

Important issues facing the country 5% 0%

78% 1%

16% 10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Source: Survey of U.S. adults conducted July 10-16, 2023. “Americans’ Dismal Views of the Nation’s Politics,” Pew Research Center.

20 | CRAIN’S CHICAGO BUSINESS | DECEMBER 18, 2023

voters who represent a small slice of the electorate — typically 8% to 10% —but hold the more extreme views of the party.

“The politicians are answering to that 8%,” Gehl says. “No one should win an election until November voters have had their say.” Eliminating

the partisan primary should change the way representatives do their jobs, providing flexibility to reach across the aisle, negotiate and find

V b d “ e s l t e

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Avoiding ‘weird outcomes’

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Alaska is the first U.S. state to enact a Final Four election and showcased the upside of the process with the election of Democrat and Native American Mary Peltola to the state’s sole seat in the U.S. House. The death last year of the state’s long-serving Republican representative, Don Young, triggered an open primary that drew 48 candidates to replace him, including Sarah Palin. In the special ranked choice election, Peltola emerged victorious after Palin and another candidate split the Republican vote. Peltola went on to win a full term in November 2022. Palin initially blamed her defeat on the ranked choice process, but analysts say Peltola won by highlighting issues that Alaskans cared about most, including energy, the environment, jobs and avoiding identity politics. Peltola has assembled a bipartisan staff and works well with the state’s Republican senators, including moderate Lisa Murkowski, political analysts say. “Mary is immensely popular, she’s seen as a transformative candidate” says Anchorage attorney Scott Kendall, a former aide to Murkowski who drafted the ballot measure for the nonpartisan open primary that sends the top four candidates to the general election. “I wanted to push the competition to the general election ballot,” Kendall adds. “So many fewer people show up. You have 5% or 10% of the electorate deciding the race. That leads to weird outcomes.” What’s happening in Alaska is interesting, says Chicago political strategist Tom Bowen, who worked on Barack Obama’s 2008 presidential campaign as well as the mayoral campaigns for Rahm Emanuel and Lori Lightfoot. “It’s not such a blood lust competition.” The state of the world is too dangerous to allow primaries to be driven by the most angry and ideological voters, adds Bowen. With a Final Four or Final Five system, there will be more choice and more diverse constituent groups who are in a position to influence the outcome, he says. That takes the emphasis away from primaries and puts it in the right place, the general election, where the larger share of voters participates, he argues. It’s no surprise that the major po-

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CRAIN’S

VOTING METHODS EXPLAINED Voting is the cornerstone of U.S. democracy, but the framers of the U.S. Constitution left details to the states. Article I, Section 4, says, “The times, places and manner of holding elections for Senators and Representatives, shall be prescribed in each state by the legislature thereof; but the Congress may at any time by law make or alter such regulations, except as to the places of (choosing) Senators.” For the first half century of U.S. elections, voters didn’t use paper ballots. Those allowed to vote (only white, land-owning men)

went to the local courthouse and publicly cast their votes out loud. The first paper ballots were nothing more than scraps of paper on which a voter wrote his candidates’ names and dropped them into the ballot box. The U.S. has over 8,000 election jurisdictions, and more than 200 use an alternative voting method for some or all of their elections. Starting with the method most American elections use, plurality voting, here are three alternative methods for choosing representation.

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VOTING AND DEMOCRACY

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PLURALITY VOTING

APPROVAL VOTING

RANKED CHOICE VOTING

RANGE VOTING

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Plurality voting lets voters pick just one candidate. The candidate with the most votes wins.

Approval voting lets voters pick all the candidates they want — one, two, or however many — and no ranking is necessary. Again, the candidate with the most votes wins. This method is used in two U.S. cities — Fargo, N.D., and St. Louis.

Also known as instant runoff voting, or RCV, this method requires voters to rank candidates in order of preference, with the candidate having the fewest first-choice votes being eliminated in each round until a candidate has more than half the remaining first-choice votes. Many in-use ballots limit the rankings to three.

Also called score voting, it allows voters to assign a score to each candidate, with the highest-scoring candidate winning the election.

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litical parties are defending the partisan primary as a proven system that voters understand. In Nevada, the parties are trying to block a years-long effort by the political action committee Nevada Voters First to establish open primaries and ranked choice voting by amending the state constitution through a ballot initiative. Funding is coming from out of state — with the largest infusion from Gehl’s Campaign for Final Five Voting. As a purple state with 40% of voters registered as independents, Nevada is ripe for change, says Mike Draper, a partner at the Las Vegas government affairs firm leading the campaign. Independents form the largest voting block, but they can’t participate in closed party primaries. The combination of an open primary followed by a Final Five election with ranked choice voting is an attempt to interject competitiveness into politics, he says. Top Nevada lawmakers, including Democratic U.S. Sens. Jacky Rosen and Catherine Cortez Masto have said an open primary would be too onerous for voters and complicate the election process. In Maine, the state Legislature voted to repeal statewide ranked choice voting after a court advisory opinion questioned whether the system violated the state constitution. Ranked choice voting had been approved in a 2016 referendum and its status was in limbo for a while. But in 2018, Maine voters passed a “people’s veto” referendum that reversed the Legislature’s action. Residents were informed on the issue, says Anna Kellar, executive director of the League of Women

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Resistance to “spoilers”: Low Prospects for U.S. adoption: High

Resistance to “spoilers”: Medium Prospects for U.S. adoption: Medium

Resistance to “spoilers”: Medium Prospects for U.S. adoption: Low

Resistance to “spoilers”: High Prospects for U.S. adoption: High

Note: A spoiler is a non-winning candidate whose presence on the ballot affects which candidate wins. Sources: U.S. Election Assistance Commission, Fairvote.org

Voters of Maine and Maine Citizens for Clean Elections. “It was in the news all the time,” she says. The desirability of ranked choice voting resonated because former Republican Gov. Paul LePage, a polarizing politician, had won his first race with less than 40% of the vote. “There was a sense that ranked choice voting was solving a problem that people understood,” Kellar says. Today, ranked choice voting is used for all of Maine’s congressional races and presidential elections, for gubernatorial and state Legislature primaries, but not for the state’s general elections. It’s also used in some local races.

Concerns about confusion, disenfranchisement Because ranked choice voting is new to Illinois, battle lines have yet to be drawn. Voters are just becoming familiar with the concept. Szilva says FairVote Illinois isn’t opposed to the idea of Final Five Voting, but that ranked choice voting is more achievable because it’s better known and more widely used. The idea of a single open primary isn’t widely discussed and the established Illinois parties would be loath to cede their control, strategists say. Szilva speaks to local groups around the state, demonstrating how ranking works by having meeting attendees vote on their phones for their favorite cartoon character, car or food. Local FairVote chapters are in Bloomington/Normal and one in DuPage County, he says. One group with no use for the ranking system is the Illinois Opportunity Project, a right-of-center group that advocates for reduced taxes and says ranked choice vot-

ing is overly complicated and leads to voter confusion. Ranked choice and open primaries could theoretically benefit Republicans, who have been a minority in Democratic Illinois. But Katie Clancy, a spokesperson for the Illinois Opportunity Project, says ranked choice voting “is a solution in search of a problem.” The process makes it harder to vote, harder to tabulate results, decreases voter confidence and risks disenfranchising vulnerable voters, she says. Representatives of the project testified against ranked choice voting at a General Assembly hearing last spring. Voters with knowledge of the process say the ramifications are not clear cut. “We need more moderate members of Congress, but I’m not convinced ranked choice voting or Final Five is a cure,” says Chicago urban planner Daniel Knickelbein, a registered Democrat. Ranked choice advocates may be overstating how effective it would be in producing more moderate candidates, he says. If the concern is making sure a candidate has a majority, an easier reform is to require a runoff, he adds. Ranked choice voting favors “high information,” voters who are well-informed by watching cable news or following other news outlets,” says Chicago campaign strategist Peter Giangreco. But it has the potential to disenfranchise the “low information” voters who don’t track elections that closely and are accustomed to picking a single candidate, he adds. Advocates say ranked choice voting is supposed to boost turnout. “But if you make elections more complicated, people could throw

Where is ranked choice voting used? As of November 2023, 50 American jurisdictions have ranked choice voting (RCV) in place, reaching approximately 13 million voters. This includes two states, three counties and 45 cities. Statewide Local/primary elections Military and overseas voters Presidential primaries Special elections

Sources: Fairvote.org

up their arms and say, ‘I don’t know enough, I’m not going to vote.’ ” says Giangreco, who has worked on campaigns for Obama, U.S. Reps. Mike Quigley and Danny Davis, and former presidential candidate Sen. Amy Klobuchar of Minnesota. Defenders say voters aren’t obligated to rank candidates and there’s no evidence that groups have been disenfranchised. “People rank things in their daily lives all the time. Like their top 10 favorite songs, says Alisa Kaplan, executive director of Reform for Illinois, which spearheaded the campaign for ranked choice voting in Evanston. Evanston voters last year approved the ballot measure for ranked choice voting by a decisive 82%. It’s supposed to go into effect for the next local election in 2025. “I

don’t want to say it was easy,” Kaplan says. City Council members raised questions and concerns about confusion and disenfranchisement. “Elected officials have learned to win under the current system,” she adds. “Those officials would say, ‘the current system elected me, there can’t be anything wrong with it. Does that mean I wouldn’t win the next election?’ ” There’s one more major hurdle: Evanston’s elections are administered by Cook County, which must supply new software for a ranked choice election. “The clerk’s office has met with and had preliminary discussions with Evanston officials,” says a spokeswoman for the Cook County Clerk’s Office. “No additional details have been determined at this point.”

DECEMBER 18, 2023 | CRAIN’S CHICAGO BUSINESS | 21

CRAIN’S

VOTING AND DEMOCRACY I COMMENTARY

Approval voting forces politicians outside their bubbles

THOMAS J. LINDEN

vote for the four you like. You may have heard of ranked choice voting (RCV), but approval votward? ing is different. With RCV, Once a year, your you rank candidates in Fox News-obsessed uncle order of preference. Apand your campus-protestproval voting is just pickleading cousin are forced all-you-like. You can to be in the same room support both systems. with those outside their Chris Raleigh is the director of After all, liking multiple partisan bubbles. things is our thing. Are there fights? Some communicaTo the voter, the power years. But for most of us, tions and of approval voting may most of the time, even advocacy for not be obvious. Yet this our most partisan rela- The Center for tives tone it down when Election Science. ability to pick multiple candidates forces politiforced to be in person for the holidays. These face-to-face cians into a new situation. They interactions can even rebuild lost have to travel outside their bubempathy and lead to new mutual bles if they want to win. Currently, campaigns look at the understandings. We want these values in our democracy. To do electorate and say, “Who do I need that, we need to find a similar bub- to talk to . . . and not a single perble-bursting force that works year- son more.” They know voters can vote for only one candidate and round. My organization fights for a sys- they bank on that. Using powerful tem called approval voting because voter analytics, campaigns essenwe’ve seen it do just that. tially put each voter into buckets Approval voting works like this: — those worth speaking to, or not. Do you already support the canImagine a ballot with 10 candidates (a party’s primary, for example). didate? You’re not worth it. Are you You really believe in three candi- likely to disagree with the candidates. With approval voting, you date? Also unworthy. Politicians check all three of their boxes. Or if are creating their own bubbles in you hate six candidates, you simply which they live, deciding who mathat makes the holidays so special? And awk-

ters and ignoring everyone else. This is approval voting’s power. Every connection with a voter can become a vote for a campaign, even if they like someone else, too. But what the voters expect also changes: “You want my vote, you come speak to me.” We’ve seen this shift since approval voting was adopted in St. Louis in 2020. In the past, candidates could win with support from a small faction, especially if many

candidates ran. The last pre-approval voting mayor won with just 32% of the vote in 2017, mostly representing only her corner of the city. In 2020, activists won a ballot measure to adopt approval voting. Only four months later in St. Louis’ first approval voting election, Tishaura Jones came out on top with 57% approval. Prior to the change, in 2017, Tishaura Jones received only 30% of the vote.

What happened? Jones connected with voters outside of her neighborhood, meeting people on both sides of the city’s divides. Voters finally could say that they supported Jones along with other candidates they agreed with. What could your uncle and cousin agree on this holiday season? That their vote matters, and politicians should care what they think. Your family could agree on approval voting.

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22 | CRAIN’S CHICAGO BUSINESS | DECEMBER 18, 2023