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Chicago, Software Development and the Cloud: The Perfect Storm for Innovation


Last week the Illinois Technology AssociationChicago skyline profiled 10th Magnitude.  While preparing the profile, which focused primarily on our Chicago-based cloud software development business, they asked an interesting question – “what are the advantages of being a Chicago-based technology company?” 

Well, that’s an easy one, particularly for cloud developers like us, to answer. Chicago is the perfect medium for cloud. Why?  Because there is no other US metropolitan market that has the depth and diversity of SMBs that exist in Chicago. And this critical mass of SMBs is already demonstrating what I see coming for future of cloud computing: cloud enables SMBs to innovate in ways that suddenly allows them to compete effectively with larger enterprises.

This is profound.

Chicago’s economy is populated by diverse established businesses: financial services, manufacturing, transportation, professional services, and consumer goods, just to name a few industries represented. That varied business community is comprised of a range of business sizes: from established companies with massive resources to mid-size enterprises in various stages of growth to start-ups that are conceptualizing new ways of doing things. Just look at our record since we started 10th Magnitude two years ago – we’ve worked with a diverse group of Chicago SMBs that have all harnessed the flexible, cost-effective power of the cloud to change their markets and grow their businesses:

  • a merchant credit card processor
  • a parking garage company
  • a corporate sales consultancy
  • a marketing agency
  • a hedge fund
  • a transportation company
  • a medical device manufacturer

For these companies and others of similar scope, cloud development substantially reduces the risk of undertaking new investment and it magnifies the benefits of innovation. Most importantly, though, it levels the playing field. Innovations large companies could implement because they had massive resources were unattainable to the SMB. That barrier is gone. Shattered. And Chicago is the perfect proving ground.   

Marc Andreessen once famously wrote that “software is eating the world.” I believe he is right. And I will add that in today’s economy, when a company innovates—and I’m talking about almost any new product, new market entry or new service provision—it requires software. 

In the past the need to develop software was a major barrier to an SMB, but cloud development has turned that on its head. The only capital requirements are to get the software built (which is faster and less expensive thanks to PaaS, but that’s a story for another blog).  With all of this risk pulled out of the equation, an organization can execute big, innovative technology and the only barrier to growing a business is ideas. 

So back to my toddling town, Chicago. Many people have hypothesized that the cloud plays well in the SMB space – I will go several steps farther and say that cloud is a transformative platform for them. The Chicago market is loaded with organizations that can take advantage of this transformation because they have a deep understanding of the markets they serve and of the innovations which will add massive value to them.  So what I see happening here in the middle of the US is really a microcosm of what will continue to proliferate as cloud development expands. 


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