Issuu

HOT JOBS: Reopening sectors drive demand for workers. PAGE 8

CRAIN’S LISTS: The region’s private-equity and VC firms. PAGE 13

CHICAGOBUSINESS.COM | AUGUST 23, 2021 | $3.50

Is Time Up for Tina Tchen?

TEST

Lisa Weichman Harries leads the exemption committee at Rush University Medical Center.

In the wake of the Andrew Cuomo sexual harassment scandal, this influential Chicago power broker is facing a reckoning of her own

OF FAITH BY STEPHANIE GOLDBERG

BY ELYSSA CHERNEY

See EXEMPTIONS on Page 18

See TCHEN on Page 20

JOHN R. BOEHM

into. Taking a hard line could hurt morale and open the door for liability under laws banning religious discrimination. But a lax approach could undermine vaccine mandates, potentially exposing employees and customers to infection.

Chicago attorney Tina Tchen made a name for herself in progressive political circles as an adviser to power. While that inside edge helped land her a spot in the White House and a position commanding a high-profile law firm in the city, it’s now bringing her into uncomfortable proximity to one of the biggest scandals in national politics: the sexual harassment allegations leveled against New York’s soon-to-be-ex-governor, Andrew Cuomo. The full extent of the role she played in Cuomo’s fall from grace is still unclear, but the shadow of conflict hangs over the situation nevertheless, since Tchen’s Tina Tchen latest gig is running Time’s Up, an organization founded with the stated purpose of advocating for victims of sexual harassment and violence. The chairwoman of Time’s Up, Roberta Kaplan, stepped down from her post at the advocacy organization soon after it was revealed that she and Tchen had provided counsel to the disgraced governor in the run-up to his resignation over charges that he had sexually harassed as many as 11 women. Unlike Kaplan, Tchen has remained in her post as CEO.

Companies requiring vaccines will have to judge the sincerity of religious objections AS MORE EMPLOYERS REQUIRE workers to get vaccinated against COVID-19, they’re bracing for a wave of religious exemption requests. Vaccine mandates, like those implemented at companies including United Airlines, McDonald’s and local hospitals, typically exempt employees with sincere religious objections.

Those objections will present employers with an uncomfortable challenge: For the first time, many companies will have to assess the sincerity of workers’ asserted religious beliefs and—as required by workplace laws— craft accommodations for those who are excused. It’s a thicket few relish wading

Why Hyatt booked a resort vacation Its $2.7B deal for Apple Leisure could be a sign the hotel market has shifted for good

BLOOMBERG NEWS

BY DANNY ECKER Hyatt Hotels isn’t sure when or if people will travel again for business like they did before the pandemic. So it’s betting bigger on beaches. The Chicago-based hotel giant’s announcement this month that it will pay $2.7 billion—or more than a third of its entire market

capitalization—to acquire resort giant Apple Leisure Group marks a major pivot by a brand best known for its urban, full-service hotels with lots of meeting space for groups and conventioneers. After a summer that unleashed pent-up leisure tourists to an even greater degree than Hyatt and others predicted, and with little clarity about when business

travelers will return to the road in greater numbers, the deal— which stands to make Hyatt the world’s largest owner of luxury all-inclusive resorts by room count—signals that the Pritzker family-backed company expects vacationers to be a bigger ticket to growth for the foreseeable future See HYATT on Page 18

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EXCHANGES

REAL ESTATE

Here’s why Cboe is still expected to draw buyout offers. PAGE 3

Look inside an English manor in west suburban Hinsdale. PAGE 23

8/20/21 4:45 PM

2 August 23, 2021 • CRAIN’S CHICAGO BUSINESS

How did those Amazon lockers land in our parks?

to be able to pick up a package—ignore those delivery trucks—while jogging, having a picnic or otherwise enjoying outdoor greenery in an age of stress? A different take comes from Juanita Irizarry, executive director of Friends of the Parks, a watchdog group. “Important policy issues like the commercialization of public spaces and the contracting processes of our government should be debated in a transparent way, not hidden from view,” says. Amen. I DOUBT MOST CHICAGOANS ARE WILD sheNews of what Amazon and the Park ABOUT WHAT AMAZON IS UP TO. District are up to first emerged a few days ago when ing things by your constituents or Block Club Chicago reported that board without an open hearing. Or huge metal racks containing delivtossing away your long-term goals ery lockers had suddenly appeared and mission to make a few bucks. in the middle of sidewalks at two Which leads to the story about parks on the Northwest Side. The Chicago Park District Superintenlockers eventually were moved dent Michael Kelly and the secret after gripes from local aldermen. deal he and his crew struck with But I figured the better story might Amazon to bring the pleasures of be in how they got there in the first internet shopping to a park near place. It was. your home. I mean, isn’t it heaven e it the mayor of Chicago or the superintendent of a three-school education district in the Fox Valley, anyone trying to run a government in these days of COVID-19 and economic uncertainty deserves a break. Balancing the books and serving public needs never has been more challenging. That having been said, some rules never should be broken, even in tough times. Like sneak-

According to the district’s chief administrative officer, Juliet Azimi, officials heard late last year that Amazon was working with the Chicago Transit Authority on a program in which people could pick up their packages at el stops, rather than going to a local store or trusting them to their home front porch. So, the district called Amazon. “We’re always looking for opportunities to maximize our nontax revenue stream,” Azimi told me. “We also consider (the racks) an amenity. They’re working pretty well in certain neighborhoods.” So far, according to the district, the racks have been installed in 49 parks since last December, received 30,000 packages and netted the district just under $100,000 in revenue. Now, I have my doubts whether most Chicagoans, who balked at giving the Chicago Bears’ naming rights to Soldier Field and otherwise have objected to ads in the parks, are wild about what Amazon is up to. What’s next, turning half of Lincoln Park into a huge parking lot

GREG HINZ ON POLITICS

for high-rise neighbors, or electronic billboards in Grant Park touting video poker? Besides, 30,000 packages at 49 parks over nine months comes out to something like four a day per location. Some amenity. But that’s debatable. What’s not is that the district, unlike the CTA, didn’t bother to the propose this to its board for a public hearing. It’s also worth noting that the CTA pilot program involves just four el stops that already have coffee shops, newspaper stands and the like. And that the CTA has netted all of $1,200 while the Park District is on pace to garner hundreds of thousands. Azimi, park board Chair Avis LaVelle and others respond that parks rules require board approval of only expenditures, not new revenue sources. At least

some of the time, local officials knew of and approved the installations, LaValle adds, although one alderman whom she cited, James Cappleman, 46th, says he was “informed,” not asked, to approve a site in his ward. But even LaValle concedes she was not told in advance of a controversial commercialization of park space that involves hundreds of thousands of dollars a year. Says Amazon in a statement, “We have been working closely with the Chicago Park District since 2020 to add Amazon lockers following requests from the district for this added benefit for the community.” Says Irizarry, “Everything about this is inappropriate.” Somehow, I think I agree with Irizarry.

Hey, Springfield: The door is open to real change

he state’s two major political parties just unofficially kicked off the campaign season at their annual rally days at the Illinois State Fair in Springfield. With the primary election date next year moved from March to June 28, there’s potential for a much different political dynamic to be in play. That primary election comes just under a month after the traditional end of the spring legislative session, so the campaign posturing and maneuvering in that session could be intense, at least for those who have contested races. Wouldn’t it be a breath of needed fresh air if party leaders took advantage of this change and worked with their rank-andfile members to pass some laws for which the people of Illinois have been yearning for years? Look, the Democrats predictably just crowed about all they’ve accomplished, and Gov. J.B. Pritzker already paid for billboards touting Democratic pluses. Predictably, the Republicans pointed out where the Democrats have come up short. With the primary so close to the policymaking, how about accomplishing something that the politicians can use in campaigns? Remember the commission that was formed a few years back to ease property taxes and consolidate government? Nothing got passed into law. And yet, just last week, the Cook County treasurer’s office released a report revealing property tax increases hit predominantly Black and Latino suburbs the hardest. Specifically, 6 of the 10 communities with the largest total residential tax increases were in majority Black or Latino areas, the

office reported. That is an inequity in desperate need of a solution. It’s a safe bet to say everyone would like a break on property taxes in Illinois, but little ever is done. Illinois lawmakers could pass a plan to extend a moratorium on the creation of more local governments in Illinois. Prior to a now-expired moratorium, 384 new local governments were created since 1998. It bears repeating that the Civic Federation issued a report in April that found Illinois has 9,000 governments, far more than what the federal government has reported. Why not use the time now before that June primary to achieve some efficiencies? Pass the Citizens Empowerment Act that would give voters more chances to approve consolidation. For years, Democratic state Rep. Rita Mayfield has been trying to win approval to create a school district efficiency commission to push for referendums to consolidate some of Illinois’ 852 public school districts. Republican state Sen. Sue Rezin has pushed a plan to allow local voters to approve sharing of school superintendents, but it never gets done. Next year also would be a terrific time to pass some stronger ethics legislation. Democrats and Republicans both have had to admit this year that what they did pass wasn’t nearly enough. Legislative Inspector General Carol Pope’s resignation and claim that the ethics package makes her job tougher put another exclamation point on the problem. Empower that office to do its investigative job, issue subpoenas and publish all findings of wrongdoing without approval first from lawmakers. Add a nonpolitician or two to the

CORRECTION The last name of Baum Realty Group’s Lee Dickson was misspelled in an Aug.

Legislative Ethics Commission to enhance its credibility. Expand the length of time to two years that lawmakers must wait after they leave office to start lobbying their colleagues. Require lobbyists to disclose when they also serve as campaign fundraising bundlers for candidates so the public knows who has extra influence in campaign financing. And then there’s redistricting. Can we agree now to find some compromises for the 2030 cycle that could help Illinoisans see more competition on their ballots? Can we at least agree that the state

MADELEINE DOUBEK ON GOVERNMENT

constitution’s clause calling for a winner-take-all drawing at random to determine which party controls the cartography was a mistake? The push to move the primary to June ought to be made permanent. That could boost voter participation. And our politicians would be wise to take advantage of moving

the primary closer to the end of legislating to approve laws and policies that make for much smarter politics. Madeleine Doubek is executive director of Change Illinois, a nonpartisan nonprofit that advocates for ethical and efficient government.

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BREWING BEER STARTUPS Pilot Project launches new craft brands as market loses some fizz

Starting a craft brewery was becoming riskier even before the pandemic pummeled the industry, with competition rising and sales growth slowing. But a brewery incubator in Chicago’s Logan Square neighborhood is clearing obstacles for

Airline pilots are in sky-high demand

From furloughs to promotions: Voluntary exits during COVID compound a looming wave of retirements BY JOHN PLETZ Although air travel hasn’t fully recovered from the coronavirus pandemic, big airlines such as United are hiring more new pilots than ever before. Voluntary leaves offered during the COVID-19 pandemic are adding to a wave of baby boomer retirements that has been building for several years. The result is an unprecedented surge in demand for new pilots that will stretch the training resources at major carriers and siphon talent away from smaller regional airlines. Last year, United was preparing to lay off about 2,250 pilots, cutbacks that were averted because of billions in federal aid to airlines and a compromise with its union to keep flyers on the payroll. As travel picked up after

P003_CCB_20210823.indd 3

vaccines became widely available, the airline started hiring again. This year, it’s already hired nearly 500 pilots and will top 1,300 by year-end, the most in a single year. By next July, it will have hired 1,700, says Curtis Brunjes, who oversees pilot strategy for the Chicago-based carrier. American Airlines, the second-biggest carrier at O’Hare International Airport, says it will hire 350 pilots this year and 1,000 more in 2022, the fastest pace ever. Atlanta-based Delta Air Lines also says it will hire more than 1,000 pilots next year. Southwest Airlines, the dominant carrier at Midway International Airport, plans to hire about 120 new pilots this year but declined to say how many it will hire next year.

budding beer-makers. Pilot Project Brewing has added 11 breweries to its portfolio since it opened in 2019. The company selects promising applicants from a pool of hundreds, brews, markets and distributes their beer, and then delivers sales data the brewers can use to determine what works and

◗ HIRING TAKES OFF How many new pilots the big traditional carriers are planning to hire through next year. United

1,700

American 1,350 Delta 1,000

The number of pilots at major airlines who face mandatory retirement is on the rise.

what doesn’t. The idea is to lower entry barriers and reduce risks for undercapitalized startups while they seek out markets for their beer. Co-founder Dan Abel says that with a projected annual revenue of $4 million, See BEER on Page 21

Cboe is growing more attractive Why the options exchange operator is expected to draw buyout offers, even if CME isn’t interested

3,500

BY STEVE DANIELS

3,000

Even though CME Group said it’s not in merger talks with Cboe Global Markets, some still see the smaller Chicago-based derivatives exchange as a ripe buyout target. On the day after CME categorically denied a report in the Financial Times that it had offered to buy the options mart, Cboe’s stock nonetheless jumped 4.1 percent on more than double its average volume. That’s not a surprise, analysts say. CME may have unceremoniously squashed the Aug. 18 report, saying it “has not had any discussions with Cboe what-

2,500

3,118

2,000 1,500

’21 ’23 ’25 ’27 ’29 ’31 ’33 ’35

Sources: The companies, KitDarby.com Aviation

The surge in hiring will ripple through Chicago, one the nation’s largest aviation hubs and home base for thousands of airline pilots. See PILOTS on Page 22

TODD WINTERS

BY ALLY MAROTTI

Edward Tilly, left, chief executive officer of Cboe Global Markets, and Terrence Duffy, chairman and chief executive officer of CME Group. soever,” but Wall Street expects Cboe eventually to be acquired by a larger exchange, whether it’s CME or another of the several with the financial firepower to do it. Of the major exchanges, “Cboe is the smallest in the U.S.,” says Michael Miller, analyst at Morningstar in Chicago. “They’re easily acquired. Sixteen billion dollars (the 20 percent premium See CBOE on Page 21

8/20/21 4:37 PM

4 August 23, 2021 • CRAIN’S CHICAGO BUSINESS

ON BUSINESS

ComEd should pay up for more than its bribes Bills pending in Springfield that would allow a broader ICC investigation and authorize $200 million in refunds have stalled out. That leaves private litigation as customers’ best hope for anything close to full restitution. Several lawsuits seeking just that have been filed in state and federal court. ComEd rejects any suggestion that formula rates and other legislation passed at its behest have harmed customers. “The government has not alleged that ComEd customers were harmed by the legislation referenced in the deferred prosecution agreement or that ComEd made excessive investments,” spokesman Paul Elsberg says. “In every one of the nine years at issue, ComEd’s investments were subject to a thorough and transparent review to ensure they were both reasonable and prudent, and supported customers’ utility service—investments that provide significant benefits to the families and businesses we serve, who arguably receive the most reliable, affordable and cleanest electric service in America.” It’s true that ComEd MONEY SHOULD BE RETURNED customers’ total bills have declined, but only because TO THOSE IT WAS TAKEN FROM. the price of electricity itself—which ComEd passes along at cost—has plunged. The under laws enacted as a result of rates ComEd charges to deliver ComEd’s corruption. The compower to customers’ homes and pany has extracted an extra $750 businesses have risen 35 percent million from customers since under formula-rate legislation. legislators in 2011 approved Customer bills would be much a “formula rate” system that lower without the higher delivery curtails utility regulators’ power charges. to reject rate hikes. Another Plaintiffs in the private litigation law passed in 2016 requiring want those charges refunded. customers to subsidize nuclear “The formula rate was associated power plants owned by ComEd with the scheme,” says David Koparent Exelon will generate $2.4 lata, CEO of energy watchdog Citibillion over 10 years. zens Utility Board. “We paid more Those charges are the true fruit than we should have because of of ComEd’s crimes, and ComEd the formula rate. That means conshould not be allowed to keep it. sumers are owed a refund.” The money should be returned to How much are they owed? “It’s those it was taken from: ComEd’s at least $200 million, and I think customers. it’s substantially more,” Kolata So far, customers haven’t seen a says. dime. ComEd paid a $200 million That uncertainty is typical of fine under a deferred prosecution private litigation. There’s no telling agreement with federal prosecuhow much a judge or jury lacking tors in Chicago. But that money expertise in electricity markets went to the federal government. and utility regulation might award Unfortunately, the ICC probe as damages in a lawsuit. won’t go after ComEd’s excess The ICC, by contrast, has the profits, either. Commissioners expertise to calculate fair recaccepted a staff recommendation ompense for ComEd customers. that the investigation be confined Commission staffers can assess to “examining whether ComEd the value of grid improvements improperly recovered costs inunder traditional rate-review curred in effectuating the pattern procedures, compare them with of unlawful conduct described ComEd’s delivery rate increasin (the deferred prosecution es and determine how much agreement).” That puts ComEd’s should be refunded. ill-gotten profits off limits. If the commission lacks ICC spokeswoman Britney authority to conduct such an Bouie says the commission lacks investigation, lawmakers should authority to pursue customer rechange that. funds for the additional payments. Illinois utility regulators took a baby step in the right direction on Aug. 12 when they launched an investigation into whether Commonwealth Edison’s customers were improperly billed for bribes the utility paid in its massive Springfield influence-peddling campaign. The Illinois Commerce Commission probe will focus on payments ComEd admitted making to various associates of former Illinois House Speaker Michael Madigan in order to win his blessing for legislation that has been worth billions to the electric utility. ComEd customers would be entitled to refunds if the cost of those bribes was added to their monthly electric bills. ComEd absolutely should reimburse customers for any charges related to bribery. But the consulting contracts and jobs ComEd handed out to curry favor with Madigan would represent only a tiny fraction of the harm customers suffered as a result of the company’s illegal conduct. Far more harmful are the additional charges customers have paid, and continue to pay,

P004_CCB_20210823.indd 4

The win-win exchange of ‘microinternships’

The best way to assess someone’s skills and for a college student to learn is to do the work—even if for a short time, says Jeffrey Moss, founder of Parker Dewey BY EMILY DRAKE AND TODD CONNOR Chicago Comes Back is a weekly series on ChicagoBusiness.com providing leadership insights to help your business move forward, written by leadership consultants Emily Drake and Todd Connor. Drake and Connor facilitate Crain’s Leadership Academy. Drake is a licensed therapist, owner of the Collective Academy and a leadership coach. Connor is the founder of Bunker Labs and the Collective Academy and is also a leadership consultant. Check out previous installments at ChicagoBusiness.com/comesback. TODD CONNOR: Jeff, thank you for speaking with us about the state of employment and changing trends around how folks are getting jobs. You’ve been a technology and education investor for nearly 20 years and launched Parker Dewey to address what you saw as an abyss between hiring employers and potential candidates. Tell us more. JEFFREY MOSS: Parker Dewey was founded six years ago to overcome the challenges facing so many college students and recent grads, which we call “career launchers,” and employers in landing that “right” first job out of school. As an investor in education and technology, as you mentioned, I realized that the process was broken. College students who had incredible skills were often filtered out for internships and full-time roles if they didn’t have the “right” major, GPA, academic pedigree or family connections. While this negatively impacts all college students, it’s especially felt by those from diverse and unrepresented backgrounds. And this didn’t just hurt the students and recent grads, but companies were impacted as well, with 55 percent of new hires leaving their job within the first 12 months. Companies would hire students who seemed great on paper and in the interview, but then they started to realize they lacked communication, problem-solving, grit and other “core skills.” To that, we know that the best way for companies to assess someone’s skills and for a college student to learn about opportunities is to do the work—even if for a short duration, which we’ve termed “microinternships.” Think about it like a “date” before the “engagement” of an internship or “marriage” of a full-time role. EMILY DRAKE: I love this idea! We normalize, in so many other areas of our lives, sampling before we commit: free returns and exchanges on goods or free trials on subscriptions. When it comes to hiring, the process feels high-stakes, for everyone involved—and lacking transparency. In practice, how does a microinternship work? JM: Since pioneering microinternships over six years ago, we’ve defined them as short-term, paid, professional assignments completed by college students or recent graduates on behalf of professionals. These projects typically take

GETTY IMAGES

JOE CAHILL

CHICAGO COMES BACK

career launchers 10 to 40 hours and are due in a few days to a few weeks. The projects themselves are often those “we should” or “I shouldn’t” tasks that remain on someone’s to-do list or aren’t the best use of time for experienced professionals, but provide invaluable experience for the career launcher. These projects are also low-risk and don’t require deep industry or company knowledge. TC: You’ve talked about microinternships as a solution towards creating a more equitable workplace. Can you say more on that? JM: Almost every organization talks about the importance of diversity, equity and inclusion—they update their websites, have ERGs and announce big programs around DEI. However, in reality many of these efforts aren’t addressing the underlying challenges in creating sustainable equity for two reasons. First, while some of these programs are creating pathways, they are for specific roles that might not take place in a corporate setting. For example, there is a lot of local discussion around apprenticeship programs, and they are creating incredible opportunities for so many local career launchers. However, as I mentioned in a piece for Crain’s a couple years back, this is not enough. While these programs might be valuable for those interested in specific departments, are they creating pathways into the more “professional” roles in finance? Accounting? Wealth management? Marketing? HR? Again, these programs are invaluable for many individuals, but in no way are they doing enough to ensure that a company is providing equitable pathways in its hiring process. The way Parker Dewey is

addressing this is by “retraining” the hiring managers and others by giving them real experiences to engage with career launchers from all types of backgrounds. This is possible because we’ve lowered the initial commitment for these professionals. When being asked to sit in a series of interviews or commit to a 10-week summer intern, the managers revert to their traditional ideal of the right candidates, as it is a big commitment for them if they make the wrong decision. However, by positioning this as on-demand support for a project the manager doesn’t want or have the time to do, qualifications are different and there’s a lower barrier to entry. When that student from a different background does the project, the hiring manager can see the skills, ability, etc. firsthand. ED: It’s such a great time to try new things, especially as the labor market is in such a tumultuous season. Speaking of, more globally, there is a lot of hiring happening. What do people get wrong when it comes to finding and choosing candidates? JM: At the early career phase, the biggest issue for companies is a reliance on the wrong signals to make hiring decisions. While signals like GPA, major, etc. may be based on historically “best” hires, they are fundamentally flawed. That said, it’s not their fault, as when hiring college students or recent grads there are so few other signals upon which they can rely. Unlike hiring someone with experience, students have few professional experiences to showcase their skills. Microinternships let students develop a portfolio of real experiences to showcase to prospective employers in a way the employers are used to assessing.

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6 August 23, 2021 • CRAIN’S CHICAGO BUSINESS

ECKENHOFF SAUNDERS ARCHITECTS

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A rendering of 345 N. Morgan St.

Sterling Bay lands $100M loan for new Fulton Market offices

August 2021

The developer goes ahead with an 11-story building right next to the Ace Hotel

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Sterling Bay has scored a construction loan for a nearly $120 million office building in the Fulton Market District, a project that comes as the trendy corridor drastically outperforms the rest of the pandemic-stung downtown office market. The Chicago developer closed on a debt package totaling roughly $100 million to begin work on an 11-story office building at 345 N. Morgan St., a Sterling Bay spokeswoman confirmed. The developer held a ceremonial ground-breaking Aug. 18 for the 200,000-squarefoot project immediately north of the Ace Hotel and kitty corner from Google’s Midwest headquarters. Backing Sterling Bay with a senior loan for the project is Bank OZK, the Little Rock, Ark.-based lender that has bet heavily on downtown Chicago in recent years, including putting up financing for a $250 million hotel and residential tower Sterling Bay is developing at 300 N. Michigan Ave. Los Angeles-based Pacific Coast Capital Partners provided a mezzanine loan for the Morgan Street project, though the value of each loan were not disclosed. But it’s a different story in Fulton Market, the former meatpacking district that Sterling Bay helped transform into a corporate destination. Companies including Kimberly-Clark, Tock, Calamos Investments and Teknion have signed new office leases in Fulton Market during the pandemic, belying the lack of activity in the broader central business district and signaling that the large swaths of newly-built workspace in the gritty-turned-trendy corridor will be quick to find takers. That was enough for Sterling Bay and its financial partners to take the gamble of building the

Morgan Street project on speculation, or without a tenant signed in advance. The developer said the project is slated to take just 13 months to complete, putting it on track to open during the third quarter of 2022. Sterling Bay CEO Andy Gloor said in a statement that the developer was ready to begin work on the building in early March 2020, just days before the pandemic started and halted the project. “Today, after navigating over a year’s worth of pandemic-related challenges, we are proud to break ground on this state-of-the-art development that will build on Fulton Market’s reputation as a premier destination to collaborate and do business in Chicago,” the statement said. One of those COVID-induced challenges that delayed the project was a legal battle between Sterling Bay and one of its lenders at the Ace that indirectly involved the 345 N. Morgan project. Sterling Bay was planning in early 2020 to transfer unused development density rights from the Ace to a property kitty corner at 1000 W. Carroll Ave., using the Morgan Street site as a conduit to comply with city rules about transferring bonus development rights among neighboring properties. Sterling Bay had a deal to sell the Carroll Avenue property to Google and develop an 18-story building there for the search giant as part of a massive office expansion. But the pandemic quashed the Google deal, and Redwood City, Calif,-based Ace Hotel lender Ohana Real Estate Investors subsequently told Sterling Bay that it was in default on its loan for transferring the bonus development rights without Ohana’s consent. Sterling Bay sued Ohana last August to block the default, effectively putting a hold on the Morgan Street project until the dispute was resolved. That resolution finally came this spring, when Sterling Bay and Ohana settled the issue, both parties confirmed. Terms of the settlement were not disclosed.

8/20/21 4:05 PM

CRAIN’S CHICAGO BUSINESS • August 23, 2021 7

Chicagoans’ natural gas bills are soaring to new heights

The average annual tab for city residents is projected to be $1,350. That’s $170 more than the previous year. BY STEVE DANIELS It’s not your imagination. When the calendar turns on a new year, the average Chicago household will have paid about $170 more for heat and cooking fuel than last year. The projected $1,350 price tag comes to over $112 a month on average, easily topping the $90-plus averages Chicagoans have been paying the past few years. Blame much higher natural gas prices, a market-distorting weather event in Texas six months ago and the escalating costs of Peoples Gas’ massive infrastructure program. Historically low natural gas prices have kept average monthly gas bills in the city below $100 even though Peoples’ charges to deliver the fuel have climbed steadily. The cost of gas, which Peoples passes onto ratepayers at no markup, in recent years has accounted for about a quarter of household heating bills. But in the first half of 2021, fuel costs were responsible for 30 percent of charges, with natural gas prices now double what they were at this time last year. In addition, utilities including Peoples have been gradually passing along the exorbitant gas costs they paid for fuel during a bitterly cold week in February that crippled gas operations in Texas and other parts of the South. Peoples Gas spokeswoman Danisha Hall says the utility expects to finish collecting what it’s owed from ratepayers for the Texas hit in early 2022. Through June, the average Chicago household paid about $765 for natural gas, up from $660 at the same point last year, according to ICC filings. The Crain’s projection for the remainder of the year was based on Peoples’ filing Aug. 13 with the Illinois Commerce Commission detailing progress on its multibillion-dollar project to replace aging gas mains and upgrade the system in the city. The utility says the projection is accurate. “While we cannot estimate how long these elevated prices will persist, we will continue to deploy purchase and planning strategies that deliver efficiency and help buffer against market volatility,” Hall wrote in an email. “We will also continue to offer customer-centric programs, such as financial assistance, energy efficiency consulting, and payment plans while partnering with local, state and federal governments and community organizations to offer as much bill payment assistance as possible to customers.” Adding to the utility-bill inflation: The surcharge Peoples

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adds to Chicagoans’ bills each month to cover the extraordinary infrastructure work now is $13 a month for the average household. It’s on course to add at least $150 to the annual gas bill this year. Last year, it accounted for $131. With concerns over heating

affordability growing, Gov. J.B. Pritzker called for ending the surcharge in comprehensive energy legislation that’s stalled in Springfield over unrelated issues. But the provisions pertaining to Peoples weren’t included in the drafts now under consideration because of objections from unions whose members benefit from the work. The surcharge authority is slated to expire at the end of 2023.

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8 AUGUST 23, 2021 • CRAIN’S CHICAGO BUSINESS

THE NEXT

HOT JOBS

The job market in Chicago looks a lot different than it was before the pandemic, but one thing remains the same: The competition to fill positions and to snag the best employees is fierce. More than half of Chicago employers—52 percent—plan to hire for new roles throughout 2021, according to a recent survey by Robert Half, a staffing company. And 48 percent plan to fill vacated positions or rehire furloughed employees. As restaurants and retailers are seeing across the country, reopening industries are driving the highest demand for workers. “In particular, industries that need in-person workers like leisure and hospitality, transportation and warehousing, and retail are desperate for workers,” says Daniel Zhao, senior economist and data scientist at Glassdoor, a job and recruiting site. “The labor shortages are also driving an increase in demand for office-based workers that support hiring, with human resources workers and recruiters in high demand—a reversal from earlier in the pandemic, when many of these workers were laid off,” Zhao says. A new study from LinkedIn confirms this trend. The top emerging job trend this year in Chicago, New York and Washington, D.C., is in the e-commerce space, with more than 400,000 open positions. Companies are seeking warehouse workers, gig workers and delivery drivers. Hiring for these positions is growing 73 percent year over year, LinkedIn finds. Another pandemic effect is a housing boom, resulting in the increased demand for loan and mortgage experts in Chicago, New York and Dallas (salary $44,000 to $60,000), according to LinkedIn. Driving the demand are historically low interest rates combined with Paycheck Protection Program loan rollouts and changing work situations that make it possible for many to work remotely. Hiring for loan and mortgage experts in 2020 increased about 59 percent from 2019. Chicago is also facing a shortage of health care support staff, LinkedIn finds. The pandemic showcased the immediate and sustained need for doctors, nurses and health care support professionals such as record-keepers and administrators, and as a result, hiring increased 34 percent in Chicago, New York and Boston (salary $65,000 to $106,000). But those aren’t the only in-demand jobs—especially in Chicago, which is the third-highest-ranking city for tech jobs (outranking San

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The most in-demand jobs center around tech, health care, e-commerce and mortgage lending. And that’s just for starters. BY DANIELLE BRAFF

GETTY IMAGES

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CRAIN’S CHICAGO BUSINESS • AUGUST 23, 2021 9

Francisco) as of first-quarter 2021. According to a new report from Dice, a professional technology database, Illinois was the sixth-highest hiring state for tech positions in the first quarter. From January to April, Chicago added 2,600 tech job postings, compared with a loss of 3,000 jobs in the year-earlier period, according to Dice. The tech occupations most in demand are software developer, project manager, network engineer and systems engineer. Product managers are also highly sought after, as they’re being recruited to coordinate the delivery of new services. The fastest-growing career is a data warehouse developer, which saw a 52 percent month-over-month increase from February to March. In Chicago, the professional-level jobs most in demand are software developer, network security professional and cloud engineer, says Marisa Ellis, regional vice president in Chicago at staffing agency Robert Half. Chicago—along with New York and San Francisco—is also seeking workplace diversity experts to help their organizations reach inclusion and diversity goals, LinkedIn says, citing a 90 percent increase in these positions (pay $73,000 to $97,000) since 2019. The major issue: Employers can’t find the qualified candidates they need. “Their biggest challenges are

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NET CHANGE IN TOTAL NONFARM EMPLOYMENT FOR THE 12 LARGEST METROS May 2021, year over year New York 878,700 Los Angeles 455,500 Chicago 303,700 Philadelphia 265,900 Dallas 260,200 Boston 252,900 Washington, D.C. 207,100 Miami 193,400 Atlanta 187,500 Houston 139,700 Phoenix 132,900 San Francisco 131,900 Source: Bureau of Labor Statistics

finding candidates with the right skills and hiring quickly enough,” Ellis says. “Companies are going above and beyond to hire the best talent by offering signing bonuses, more flexible work schedules and broadening their search geographically.” Chicago employers today are seeking workers with strong soft skills—interpersonal skills that help in a social environment—with just 10 percent of employers willing to overlook these qualifications when recruiting for open roles. For example, Ellis says, an employee needs solid interpersonal skills in today’s highly collaborative work environment; that is, problem-solving chops and critical thinking to drive innovation. Developing leadership skills may be an indicator of entrepreneurial spirit and inquisitiveness—and all these qualities are in demand. Despite the fierce competitiveness of finding the ideal candidate, however, today’s labor market is in many ways similar to that of 2019, Zhao says. Wage increases and raises are the most straightforward ways to attract new workers, but employers should also consider other creative ways to attract the attention of job seekers. “In a fast-moving, high-turnover labor market, it may be difficult to compete on pay alone,” Zhao says. “Attracting and retaining workers requires a concerted effort by employers to offer competitive pay on top of an appealing workplace and

growth opportunities.” Offering work-from-home options—popular after many workers got used to working outside of an office during the pandemic—flexible scheduling, child care subsidies and other benefits to make balancing work and life easier is more important than ever, Zhao says. Tight labor markets are also a clarion call for employers to re-evaluate their candidate pools. Offering on-the-job training or internal transfers can expand talent pools while also rewarding high-potential employees, Zhao says. Loosening degree or experience requirements or looking at remote workers can also help expand the pool of available candidates. Looking ahead to the near future in Chicago, Ellis says we can expect demand for professionals in the areas of customer-service support, call-center representatives, legal associates, open-enrollment professionals and tax accountants.

“Generally, contract professionals are hired toward the end of the year to support seasonal needs in retail and distribution, open enrollment and end-of-year budgeting,” she says. It’s still unlikely that the labor shortages will halt anytime soon— and these may even become our new normal, Zhao says, adding that this is why you’re seeing large employers like Walmart, McDonald’s and Chipotle committing to permanent wage increases. “They perceive long-term structural challenges in hiring and retaining workers,” Zhao says. Similarly, the health care system has been strained by the pandemic, but on top of that, the aging American population will increase demand for health care even after the pandemic is over, he says.

8/19/21 5:38 PM

10 August 23, 2021 • CRAIN’S CHICAGO BUSINESS

th le w h U C m er ci ra re th “a en

EDITORIAL

When a hotel operator as straitlaced as Hyatt trades its Brooks Brothers suit and Mark Cross briefcase for a Hawaiian shirt and paper-parasol cocktail, you know it’s time to sober up. Businesses that profit off of corporate travel, conventions, trade shows and faceto-face meetings—and in Chicago, such enterprises comprise an enormous swath of the local economy—just got a loud wakeup call. One of the biggest road warrior-reliant companies in the world just effectively declared it doesn’t expect business travel to bounce back to pre-pandemic levels anytime soon. If ever. That’s the clear signal being sent by Chicago-based global hotel giant Hyatt, which on Aug. 16 unveiled plans to buy KKR-backed resort operator Apple Leisure Group for $2.7 billion in cash—an amount that Crain’s Danny Ecker notes in this week’s issue is equivalent to more than a third of Hyatt’s current market cap. You might know Apple Leisure Group from its splashy ads touting budget-friendly Funjet and last-minute Apple Vacations packages to sunny beach destinations like Acapulco, Nassau, Las Vegas and Honolulu, though the company also has operations in Europe, Asia, Australia, Africa and the Middle East and partners with airlines including United and Southwest to offer vacation packages. Apple Leisure’s colorful world is one populated by images of smiling families holding hands while jumping into aqua-blue swimming pools, teenagers slipping down water slides, swimsuit-clad lovers strolling the beach at sunset and offers of “instant savings,” “limited-time

GARY MEULEMANS/UNSPLASH

What Hyatt’s big move says about Chicago’s future

Inside McCormick Place deals,” “kids stay FREE” discounts and “hot Hot HOT” exclusive perks. In other words, a far cry from the “put it on the corporate AmEx” scene at the traditional Hyatt hotel. Hyatt could hardly be blamed for wanting to diversify at a time like this. Its highend, midweek travel-heavy portfolio “is suffering probably the worst” from the pandemic among various hotel types, as one hotel-industry analyst tells Crain’s this week. Sluggish corporate demand contributed to Hyatt’s $9 million net loss in the second quarter. As Ecker notes, that was a significant improvement from the pandemic-gutted second quarter of 2020, when its net loss was $236 million, but it’s still far behind the $86 million of net income the company generated during the same period in 2019. Hyatt’s decision to put a huge pile of its

chips on the realm of flip-flops, zip lines and all-you-can-eat shrimp buffets means one of the most savvy players in the hospitality sector believes the pandemic may have permanently altered the travel industry landscape. That insight has profound implications for Chicago—and not just for those who happen to hold Hyatt stock. Chicago is one of the key convention and trade show hubs of the nation, a distinction that fuels a diverse hospitality economy spanning from our airports to cabbies and Uber drivers to the restaurants, museums, nightclubs and theatrical venues that entertain attendees while they’re here. Everyone even remotely connected to the hospitality industry has been looking for clues of a business travel rebound. Even if the delta variant hadn’t spoiled what once looked promised to be a relatively COVID-free summer and reignited qualms

about in-person meetings, there’s reason to believe workers and managers alike have discovered and appreciate the convenience and economy of remote meetings via Zoom. Why pay for staffers to fly to the home office in Wahoo, Nebraska, when Wahoo is now only a click away? If Hyatt’s read of the situation is right, Americans won’t be traveling to do business with anything like the frequency we once did even after COVID is only a memory. As a result, Hyatt is pivoting. And that means the rest of Chicago is likely to have to pivot, too. Everyone with a stake in the travel economy here—including the mayor, the governor and their tourism teams— is going to have to think creatively about ways to replace business-travel dollars with leisure-travel dollars. That may mean rethinking certain investments in infrastructure. Mayor Lori Lightfoot, in particular, has her work cut out for her on this front. McCormick Place, for one, presents a challenge. What is the plan for getting the most out of this gigantic convention space in a future where business travel is significantly off? Adjusting to the coming reality most certainly also means getting a grip on the city’s crime problem, one that plagues people who live here year-round but also chills interest in visiting this otherwise alluring city. It’s one thing to book a trip to Chicago if the boss is sending you; it’s another to choose to come here if you’re looking for an enjoyable vacation in a lively, engaging—and safe—place. Take a cue from Hyatt, Chicago. The time to start preparing for the post-COVID future is now.

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Group

Assist

YOUR VIEW

Chicago is hiring

hicago’s long been known as a city that attracts and retains incredible, diverse talent. In 2021 alone, we saw 55 corporate relocations, 10 companies that reached unicorn status—that is, startup companies valued at over $1 billion—bringing the total up to 21, and the highest growth in consumer spending among the top 20 cities in the country. Chicago’s diverse workforce also sets itself apart from other cities, and as the city recovers, it has given us an important opportunity to fill in employment gaps in various sectors across our workforce. To move this important work forward, The Chicago Cook Workforce Partnership and World Business Chicago, with support from the mayor’s office, created Hire Chicago, based on recommendations by the Chicago Recovery Task Force, or

Lori E. Lightfoot is mayor of Chicago. Karin M. Norington-Reaves is CEO of Chicago Cook Workforce Partnership. Michael Fassnacht is CEO of World Business Chicago. RTF, advisory report. The report highlighted Chicago’s strengths but also highlighted major vulnerabilities born from generational inequality and systemic racism. Shaped by Chicagoans in different industries, community organizations and policy experts, the report serves as a blueprint for the city’s equitable recovery and provides critical guidance needed to chart our path forward.

From the inequities laid bare by the pandemic to the 1.52 million people filing for unemployment benefits in Cook County between March 2020 and March 2021, the need for access to diverse, quality jobs with competitive, family-sustaining wages have never been greater. Hire Chicago is a five-week, sector-driven, largely virtual hiring initiative and career

exploration event rooted in the recommendations of the RTF. Each week of Hire Chicago features a high growth and high demand sector that drives Chicago’s current economy and its future recovery. The event began with manufacturing and next highlighted hospitality, tourism and food service. Last week’s focus was transportation, distribution and logistics, or TDL. This week will promote the health care industry, and the week of Aug. 30 will feature information technology. Hire Chicago also addresses historic inequities intensified by the pandemic and the critical need for access to good-paying jobs citywide. Understanding that hiring plays a key role in the economic recovery for the city’s businesses and residents, Hire Chicago offers job seekers a chance to reconsider their careers and encourages

them to follow their passions and leverage their unique skills and abilities as they re-enter the workforce. It also offers employers a chance to find the talented, diverse workforce they seek to recover and remain competitive in a post-pandemic economy. Right now, there are more than 150,000 job postings in the city and more than 450,000 in the entire Chicago area. Nearly 300 participating employers are offering more than 15,000 current job openings on the Hire Chicago platform. Both job seekers and employers can register at HireChicago2021.org. Most eligible jobs through Hire Chicago do not require more than a high school diploma and have salaries ranging from $39,000 to $144,000 per year. Hire Chicago’s online workshops ensure candidates have the best opportunity to present

Peo

ple

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, 150 N. Michigan Ave., 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.

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CRAIN’S CHICAGO BUSINESS • August 23, 2021 11

YOUR VIEW Continued

n ke egs he n

t, iwe mat ve he y— ut h

nri ut e, he ic ing o me ve n ne is me ae. me u-

Group publisher/executive editor Jim Kirk

Assistant managing editor/ Joe Cahill columnist Assistant managing editor/digital Ann R. Weiler

Assistant managing editor/ Cassandra West news features

Deputy digital editor Todd J. Behme

Digital design editor Jason McGregor

Associate creative director Karen Freese Zane

Copy chief Scott Williams

that offer great opportunities for job growth and economic mobility. As other major cities are still struggling to recover, Chicago is poised to have a robust economic boom. And with extended unemployment benefits coming to an end in September, now is the time for many to reimagine a path forward. Hire Chicago will help them do just that and further build out our talent pipeline in preparation for the post-pandemic prosperity of our great city. Learn more at HireChicago2021.org through Sept. 2.

In class action litigation, the number of

plaintiffs

isn’t the only factor multiplied.

Copy editor Robert Garcia Deputy digital editor/ Sarah Zimmerman audience and social media

Contributing editor Jan Parr

Political columnist Greg Hinz Senior reporters Steve Daniels

Alby Gallun John Pletz

Reporters Elyssa Cherney

Katherine Davis Danny Ecker Stephanie Goldberg Ally Marotti A.D. Quig Dennis Rodkin Steven R. Strahler

Contributing photographer John R. Boehm Researcher Sophie H. Rodgers *** Managing director/ Jill Heise marketing and events

Director of digital strategy Frank Sennett

n ic

Creative director Thomas J. Linden

ob g-

*** Editor Ann Dwyer

Associate publisher Kate Van Etten

Chief executive officer KC Crain

grown talent in our city. It is also unique in that it presents a challenge to the private sector: Expand opportunity and access to quality jobs for all. Now more than ever, companies need to re-evaluate their criteria for hiring the best talent, as barriers such as legacy requirements all too often hinder the hiring of diverse candidates. At the same time, this program also challenges Chicagoans to reimagine who they can be by asking them to consider working in industries and occupations they may have never heard of before—industries

GETTY IMAGES

their skills to employers and level the playing field for those who have faced significant and historic employment barriers. Using this virtual platform, Hire Chicago allows jobseekers to meet one on one with employers, after attending sector-specific workshops on topics ranging from interviewing and resume writing tips to more themed workshops such as “a day in the life of an electrical engineer.” Hire Chicago promotes equity and inclusion in hiring and builds an important bridge between employers and home-

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8/20/21 4:00 PM

12 AUGUST 23, 2021 • CRAIN’S CHICAGO BUSINESS

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

CONSTRUCTION SERVICES

LAW

NON-PROFIT

Crowe LLP, Chicago

Bulley & Andrews, Chicago

Taft Law, Chicago

Surge Institute, Chicago

Crowe LLP, a public accounting, consulting and technology firm in the U.S. with offices around the world, would like to announce the appointment of new Riley executive leadership. Simon Riley, ACA, has been named chief strategy and transformation officer and oversees the firm’s innovation and process improvement, product engineering, firm IT and data science. Calvey Ray Calvey, CPA, has been named chief financial officer and maintains overall leadership and management for the firm’s financial operations, including safeguarding the firm’s assets and assisting in developing strategies and tactics to improve firm performance.

Tim Puntillo has been promoted to Chief Operating Officer of Bulley & Andrews. In his expanded role, he continues to oversee daily operations while ensuring alignment with long-term strategic goals. Under Tim’s purview, the organization has heightened its commitment to diversity and inclusion and expanded its national footprint. Tim’s ethos, which encourages ingenuity and prioritizes partnership, has yielded some of the firm’s strongest relationships and strengthened its best practices.

Croke Fairchild Morgan & Beres LLC, Chicago

Ian H. Fisher joined Taft as a partner in the firm’s Litigation practice. Ian represents clients ranging from small entrepreneurs to Fortune 100 companies in commercial litigation matters involving real estate, antitrust, trade secret misappropriation, restrictive covenant, consumer class defense, contract, and business tort disputes. He also counsels clients on TCPA compliance, the Illinois Biometric Information Privacy Act, risk mitigation, and restrictive covenants.

The Surge Institute, a national nonprofit organization dedicated to elevating, developing, and accelerating a pipeline of leaders of color throughout the educational landscape is proud to announce the promotion of William J. Collins to Chief Advancement Officer. In this role, William will oversee Surge’s external partnerships, growth and expansion efforts, fundraising, and alumni impact. Prior to joining Surge, William was a senior executive at OneGoal Chicago and a former CPS educator.

ACCOUNTING Crowe LLP, Chicago Crowe LLP, a public accounting, consulting and technology firm in the U.S. with offices around the world, would like to announce the following newly Bencik appointed managing partners. Nicole Bencik, CPA, named managing partner of tax services, oversees all tax services and professionals for the firm. John Epperson, named managing partner of the financial services group, oversees Epperson the delivery of the firm’s full range of services to the financial services industry.

CONSULTING Conlon Public Strategies, Chicago Chicago-based consulting and public affairs firm Conlon Public Strategies welcomes Kady McFadden as Senior Advisor. Kady has a decade of experience leading and winning strategic advocacy, legislative, and political campaigns, as well as strong relationships with local, state, and federal elected officials. The former deputy director of the Sierra Club Illinois Chapter, Kady has an MBA from University of Chicago’s Booth School of Business, and she was a 2016 New Leaders Council Chicago Fellow.

ENGINEERING Cyclone Energy Group, Chicago

ACCOUNTING Crowe LLP, Chicago Scott L. Spencer, CPA, has been named managing partner of the manufacturing and distribution services group at Crowe LLP, an accounting, consulting and technology firm in the U.S. with offices around the world. In this role, Spencer is responsible for overseeing the delivery of the firm’s full range of services to the manufacturing and distribution industry.

Sumayyah Theron has been promoted to the Director of Sustainability for Cyclone Energy Group. In this newly created role, she will work to continuously improve and add sustainability and healthy building services to better serve our clients. She will work with our team to further develop their knowledge and skills around sustainability services. In addition she will work on Cyclone’s Environmental, Social, and Governance efforts to continuously improve the company’s impact on the environment.

Business attorney Robert S. Bollinger joins Croke Fairchild Morgan & Beres as Partner. Robert works with premier lending institutions, leading private equity firms and corporate borrowers in Bollinger complex transactions, advising on debt financing, acquisitions, leveraged buyouts, spot buybacks, lending by venture funds and other matters. He is one of few attorneys with experience representing both Collins borrowers and lenders. Emily Collins joins as an Associate in the firm’s transactional practice. Her practice focuses on mergers and acquisitions, funds, securities and general corporate matters. She has served as counsel to public and private companies and guided private equity firms through strategic sales on both the buy and sell sides.

LAW Meltzer, Purtill & Stelle LLC, Chicago / Schaumburg Leading Chicago business-to-business law firm Meltzer, Purtill & Stelle LLC is pleased to announce the recent addition of attorney Max Frazier and paralegal Frazier Lynda Reuther. Frazier is an associate with the firm’s commercial litigation practice group in their downtown Chicago offices, with extensive experience in cases involving breach of contract, commercial evictions, and other Reuther business disputes. Reuther, who has considerable experience with secured lending and SBA financing transactions and commercial closings, joined MPS Law’s flagship Schaumburg office where she is focused on supporting the firm’s banking and finance and creditors’ rights and restructuring practice areas.

CLOUD-BASED SOFTWARE EPSoft Technologies, Chicago / Dallas

LAW

EPSoft Technologies, a software company that creates end-to-end business process automation tools, has named Mike Magnifico as Chief Executive Officer (CEO). Mike joins EPSoft with more than 25 years of leadership experience, with a portfolio that includes multiple startups and Fortune 500 companies. As EPSoft CEO, his primary goal will be to facilitate company growth and new customer acquisition by empowering businesses to automate the processes they own.

King & Spalding, Chicago

P012_CCB_20210823_v3.indd 1

Ted Tuerk has joined King & Spalding’s Corporate, Finance and Investments practice as counsel. Ted has experience representing lenders, finance companies, credit funds, asset managers, corporate borrowers and private equity sponsors in cash flow leveraged financings, acquisition financings, asset-based lending transactions, mezzanine and second lien financings, private placement financings, real estate financings, and other secured and unsecured financings, as well as restructuring and distressed lending transactions.

LAW Riley Safer Holmes & Cancila LLP, Chicago RSHC welcomes new partner Georgia Alexakis to our Chicago office. Georgia joins us after nearly nine years with the U.S. Attorney’s Office for Illinois’ Northern District, where she most recently served as Deputy Chief of Criminal Appeals. She focuses on Government Enforcement, Investigations & White Collar Criminal Defense work, as well as Appellate Advocacy, counseling businesses and key executives facing crises ranging from sensitive internal matters to high-profile enforcement actions.

NON-PROFIT The Ragdale Foundation, Lake Forest

TECHNOLOGY

Ragdale announces the election of Elizabeth Boyd as the President of our Board of Trustees and the addition of Michael C. Cleavenger as our Executive Director. Elizabeth has maintained Boyd an active artistic practice in painting for the past 14 years. She is passionate about supporting artists through community engagement, building networks, and leadership. She is the founder of Wiley Designs, LLC. Cleavenger Michael has over 25 years of experience in non-profit administration. His experience includes senior management and development positions at The Chicago History Museum, Episcopal Charities and Community Services, La Rabida Children’s Hospital, and Victory Gardens Theatre. Michael currently serves on the board of St. Bernard’s Hospital in Englewood.

CCC Intelligent Solutions, Chicago

NON-PROFIT Thresholds, Chicago Thresholds is proud to announce the addition of Ademola Popoola as Chief Information Officer. Popoola previously served as the CIO of Loyola Academy and the Senior Technology Manager at Chicago Public Schools, and has more than 17 years of experience with a focus on aligning technology with overall business strategy. He holds both an MBA and a Master of Science in Information Technology from Northwestern University. Popoola’s background combines technology knowledge with strategic leadership ability, and he will lead health information systems and new technology to support mental and physical healthcare integration as Thresholds grows. Thresholds is a mental health and substance use treatment provider serving 7000 clients annually.

CCC Intelligent Solutions Inc. (CCC), a leading SaaS platform for the P&C insurance economy, names John Goodson Senior Vice President and Chief Technology Officer. Goodson will lead research and development, product development, architecture, security, IT operations and infrastructure, business applications and data science. This will enable CCC to continue powering mission-critical workflows, intelligent automation and better experiences for clients and the millions of drivers they serve.

TECHNOLOGY SERVICES Jellyvision, Chicago Jellyvision, the benefits engagement company that’s reinventing how employees choose and use benefits, welcomes Turiya Gray as Chief People Officer and Jay Sinder as Chief Financial Gray Officer. Gray brings two decades of human resources experience across multiple industries, most recently serving as Chief People Officer for the Financial Health Network. She will lead the evolution and execution Sinder of Jellyvision’s people strategy. Sinder, an accomplished finance leader with deep experience in the software space, joins Jellyvision with an established career at both public and private companies. Prior to Jellyvision, Sinder was the Chief Financial Officer of DialogTech.

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

8/18/21 9:39 AM

CRAIN’S CHICAGO BUSINESS • August 23, 2021 13

CRAIN’S LIST CHICAGO’S PRIVATE-EQUITY FIRMS Alphabetical directory.

New investNew local ments outside investments Chicago in 2020 in 2020

Company

Top executive(s)

Assets under management (millions) as of 12/31/2020; 12/31/2019 Source(s) of funding

50 SOUTH CAPITAL1 50 S. LaSalle St., Suite 12, Chicago 60603 312-557-1998

Brad M. Dorchinez, Managing director Robert P. Morgan, CEO

$10,500.0 Public and private pensions, $9,400.0 endowments, foundations, high-net-worth individuals

ADAMS STREET PARTNERS LLC 1 N. Wacker Drive, Suite 2700, Chicago 60606 312-553-7890

Jeff Diehl Managing partner, head of investments

$44,741.4 Pension funds, endowments, $40,726.6 foundations, sovereign wealth funds, high-net-worth individuals

ANDERSON PACIFIC CAPITAL, LLC 100 S. Wacker Drive, Suite 1275, Chicago 60606 312-951-8500

Kenneth D. Anderson CEO

ARBOR INVESTMENTS 676 N. Michigan Ave., 34th floor, Chicago 60611 312-981-3770

Gregory J. Purcell, CEO Carl Allegretti, President Alan Weed, Partner

BAIRD CAPITAL 227 W. Monroe St., Suite 2200, Chicago 60606 312-609-4700

Gordon G. Pan President

BANC FUNDS CO. LLC 20 N. Wacker Drive, Suite 3300, Chicago 60606 312-855-6202

Full-time local employees as of 12/31/2020

Amount invested (millions) in 2020; 2019 Type(s) of investments:

$436.0 Early and seed stage venture capital, $573.0 North American small-midmarket buyout

1,467 $4,675.6 Venture capital, growth equity, $4,268.0 buyouts, credit

134

$500.0 $300.0

APC partners, private-equity firms, regional telecom partners, high-networth individuals

$2,935.8 $1,281.6

Institutional, pensions, family offices, endowments

$755.0 $500.0

Institutions, pension funds, highnet-worth individuals, employees

$125.0 Industrial solutions, technology, $5.0 services

Charles J. Moore President

$1,400.0 $1,500.0

Institutions, pension funds, private individuals, endowments

$175.0 Financial services companies $149.0

BOUNDS EQUITY PARTNERS 600 Central Ave., Suite 230, Highland Park 60035 847-266-6300

Mark A. Bounds Managing director

$100.0 $100.0

Private investors

$0.0 $0.0

Buyouts

CHAIFETZ GROUP LLC 455 N. Cityfront Plaza Drive, 13th Floor, Chicago 60611 312-983-3600

Ross Chaifetz, Principal Richard A. Chaifetz, Chairman

$350.0 $300.0

Richard A. Chaifetz, family office

NA NA

HR tech, SaaS, cloud, fintech, AR/ VR, employee benefits, health and wellness, consumer, media, service companies

CHICAGO CAPITAL PARTNERS 1770 1st St., Suite 200A, Highland Park 60035 312-953-4850

Marc S. Brenner CEO

$80.0 $80.0

Private

NA NA

Companies with $2 million to $8 million of EBITDA, industry- agnostic

CIVC PARTNERS 191 N. Wacker Drive, Suite 1100, Chicago 60606 312-873-7300

John Compall, Chris Geneser, Marc McManus, Chris Perry, Doug Potters, Scott Schwartz, JD Wright, Partners

$1,205.0 $640.0

Institutions, insurance companies, fund of funds, pension funds, private investors

$55.0 Outsourced services, transportation $107.5 and logistics, IT, insurance

CONCENTRIC EQUITY PARTNERS 50 E. Washington St., Suite 400, Chicago 60602; 312-494-4513

Frank Reppenhagen, Ian Ross, Ken Hooten, Jennifer W. Steans, Partners

$2,500.0 $2,000.0

Private investors

$135.5 Consumer and business services, $110.0 software, manufacturing, financials

CREATION INVESTMENTS CAPITAL MANAGEMENT LLC 156 N. Jefferson St., Suite 201, Chicago 60661; 312-784-3988

Patrick T. Fisher Managing partner, founder

$713.1 $707.8

Insurance companies, pension funds, endowments, family offices, high-networth individuals

$80.0 $92.0

Private equity, emerging markets, impact investments, financial services

DIXON MIDLAND CO. LLC 980 N. Michigan Ave., Suite 1540, Chicago 60611 312-787-1100

Aaron A. Mobarak Paul D. Furlow Co-presidents

$50.0 $50.0

High-net-worth individuals

$0.0 $5.0

Middle-market growth companies

FLEXPOINT FORD LLC 676 N. Michigan Ave., Suite 3300, Chicago 60611 312-327-4520

Donald J. Edwards CEO

$4,720.3 $4,600.0

Institutions, endowments, private investors

$336.5 Buyouts, acquisitions and $257.5 recapitalizations of health care and financial services companies

FRONTENAC COMPANY 1 S. Wacker Drive, Suite 2980, Chicago 60606 312-368-0044

Paul D. Carbery Walter C. Florence Managing partners

$629.0 $544.0

Pension funds, endowments, institutional investors, individuals, partners

$82.4 $24.9

Equity investments to fund acquisitions, growth of midsize companies in the consumer, industrial and services markets

GCM GROSVENOR 900 N. Michigan Ave., Suite 1100, Chicago 60611 312-506-6500

Michael J. Sacks Chairman, CEO

NA NA

Diversified across industries

298

GENEVA GLEN CAPITAL 123 N. Wacker Drive, Suite 820, Chicago 60606 312-525-8500

Adam Schecter, Jeff Gonyo Managing directors

$0.0 $0.0

Health care, consumer and food, business services, manufacturing

GTCR LLC 300 N. LaSalle St., Suite 5600, Chicago 60654 312-382-2200

Dean Mihas, Collin Roche Co-CEOs, managing directors

HIGH STREET CAPITAL 150 N. Wacker Drive, Chicago 60606 312-423-2650

Kent Haeger, Dick McClain, Joe Katcha Partners

$165.0 $165.0

Institutions, family offices, business executives, high-net-worth individuals

$0.0 $25.0

INDUSTRIAL OPPORTUNITY PARTNERS LLC 1603 Orrington Ave., Suite 700, Evanston 60201 847-556-3460

Bob Vedra, Ken Tallering Senior managing directors

$795.6 $798.2

Institutions, endowments, foundations, pension funds

NA NA

KEYSTONE CAPITAL 155 N. Wacker Drive, Suite 4150, Chicago 60606 312-219-7900

Kent Dauten, Chairman Scott L. Gwilliam, Managing partner

$420.0 $200.0

Firm partners, institutions, foundations, endowments

KINZIE CAPITAL PARTNERS 20 N. Clark St., 36th Floor, Chicago 60602 312-809-2490

Suzanne Yoon Founder, managing partner

$149.0 $86.5

NA NA

Manufactured products, business s ervices, consumer industries

LEAD LAP ENTERPRISES LLC 790 Frontage Road, Northfield 60093 847-441-4160

David F. Zucker Managing partner

$25.0 $25.0

Private investors

NA NA

Buyouts of small to midsize c ompanies seeking an ownership transition, growth capital

P013-P015_CCB_20210823.indd 13

$61,943.0 NA $57,746.0 $300.0 $300.0

Family office, institutional capital

$24,157.0 Institutions, public and private $11,596.0 pension funds, foundations, endowments

$250.0 Media and telecom industries $2.0 NA NA

Food and beverage, packaging

NA Financial services, health care, $1,677.4 technology, media and telecommunications, growth business services

Acquisitions, recapitalizations, growth equity investments in service, distribution and manufacturing companies with cash flow greater than $3 million

Controlling interest in value-added manufacturing and distribution businesses

$100.0 Business services, niche $60.0 manufacturing, food

8/19/21 5:37 PM

14 August 23, 2021 • CRAIN’S CHICAGO BUSINESS

CRAIN’S LIST CHICAGO’S PRIVATE-EQUITY FIRMS Alphabetical directory.

Assets under management (millions) as of 12/31/2020; 12/31/2019 Source(s) of funding

New investNew local ments outside investments Chicago in 2020 in 2020

Full-time local employees as of 12/31/2020

Amount invested (millions) in 2020; 2019 Type(s) of investments:

Th to pr

Company

Top executive(s)

LINDEN CAPITAL PARTNERS 150 N. Riverside Plaza, Suite 5100, Chicago 60606 312-506-5600

Tony Davis President, managing partner

$3,045.0 $2,855.0

MADISON DEARBORN PARTNERS LLC 70 W. Madison St., Suite 4600, Chicago 60602 312-895-1000

Samuel M. Mencoff Paul J. Finnegan Co-CEOs

MARANON CAPITAL LP 303 W. Madison St., Suite 2500, Chicago 60606 312-646-1200

Ian M. Larkin Managing director, CEO

MCNALLY CAPITAL 151 N. Franklin St., Suite 2650, Chicago 60606 312-357-3710

Ward S. McNally Managing partner

$475.5 $416.0

Family offices, select institutional investors

MERIT CAPITAL PARTNERS 303 W. Madison St., Suite 2100, Chicago 60606 312-592-6111

Terrance M. Shipp Marc J. Walfish Managing directors

$1,603.5 $1,603.5

Insurance, pensions, endowments, high-net-worth individuals

$98.7 Mezzanine, equity, leveraged $178.3 buyouts, management buyouts, recapitalizations

MESIROW PRIVATE EQUITY 353 N. Clark St., Chicago 60654 312-595-6000

Marc E. Sacks, CEO Thomas E. Galuhn, President

$5,730.9 $4,744.0

U.S. and foreign pension funds, insurance companies, banks, foundations, endowments, high-networth individuals

$337.5 Buyout, growth equity/venture $708.2 capital, special situations p artnerships

MIDWEST MEZZANINE FUNDS 55 W. Monroe St., Suite 3650, Chicago 60603 312-291-7300

Michael Foster, Senior managing director, Dave A. Gezon, Senior managing director, Paul G. Kreie, Senior managing director Ana M. Winters, Managing director

Pension funds, private investors, insurance companies, banks, family offices, fund of funds

$40.0 $75.0

MONROE CAPITAL LLC 311 S. Wacker Drive, 64th Floor, Chicago 60606 312-258-8300

Zia Uddin Partner

$9,400.0 $9,200.0

Public and corporate pensions, ndowments, foundations, insurance e companies, regional banks, family offices, high-net-worth individuals

$250.0 Generalists, software, technology, NA health care, business services

145

MULLER & MONROE ASSET MANAGEMENT LLC 180 N. Stetson Ave., Suite 1320, Chicago 60601 312-782-7771

Andre Rice President

$1,190.02 Pension funds $1,190.0

NA Lower-middle-market private-equity $128.9 funds

PATRIOT CAPITAL 150 S. Wacker Drive, Suite 2400, Chicago 60606 312-924-2833

Kyle Griffith, Associate managing director, Midwest, Thomas Kurtz, Managing director, Midwest

$900.0 $775.0

NA NA

Niche manufacturing and distribution, business and consumer services, IT services, health care services

THO 150 312-

PFINGSTEN PARTNERS LLC 300 N. LaSalle St., Suite 5400, Chicago 60654 312-222-8707

Thomas S. Bagley, Senior managing director, Scott Finegan, Managing director

$635.0 $686.6

High-net-worth investors, pension funds, endowments

NA NA

Niche manufacturing, value-added distribution, specialty business services

TILI 111 312-

PPM AMERICA CAPITAL PARTNERS 225 W. Wacker Drive, Suite 1200, Chicago 60606 312-634-2500

Austin Krumpfes Head of private equity

Institutional investors

$488.0 Consumer products, diversified, tech, $488.0 business services

TWI 123 312-

PRAIRIE CAPITAL LP 191 N. Wacker Drive, Suite 800, Chicago 60606 312-360-1133

Nate Good Managing partner

$694.5 $740.5

Institutions, high-net-worth individuals

$99.0 $74.0

Health care, technology, education, consumer

PROSPECT PARTNERS LLC 200 W. Madison St., Suite 2710, Chicago 60606 312-782-7400

Brett Holcomb, Brad O’Dell, Erik E. Maurer Partners

$365.0 $365.0

Financial institutions, pension funds, endowments, fund of funds, highnet-worth individuals

NA $1.8

Recapitalizations and acquisitions in manufacturing, value-added distribution, consumer services, business services, industrial services

RCP ADVISORS 353 N. Clark St., Suite 3500, Chicago 60654 312-266-7300

Alex Abell, Partner, Nell Blatherwick, Partner, Tom Danis, Managing partner, Charlie Huebner, Managing partner, Jon Madorsky, Managing partner, Andrew Nelson, Partner, David McCoy, Managing partner

$9,600.0 $8,300.0

Foundations, endowments, pension funds, family offices, private investors

NA NA

Lower-middle-market buyouts

ROCK ISLAND CAPITAL LLC 1415 W. 22nd St., Suite 1250, Oak Brook 60523 630-413-9136

Al Mattaliano, Brian Bastedo, Michael Nugent Partners

Institutions, family offices, banks, high-net-worth individuals

NA NA

Management buyouts, recapitalizations, growth equity

SHORE CAPITAL PARTNERS 1 E. Wacker Drive, Suite 2900, Chicago 60601 312-348-7580

Justin Ishbia Managing partner

STACKER HOLDINGS 180 N. Stetson Ave., Suite 3500, Chicago 60601 312-834-5102

Austin Reichardt, G.R. Kearney Managing partners

STERLING PARTNERS3 401 N. Michigan Ave., Suite 3300, Chicago 60611 312-465-7000

Steven Taslitz Chairman

SVOBODA CAPITAL PARTNERS LLC 1 N. Franklin St., Suite 1105, Chicago 60606 312-267-8750

John A. Svoboda Managing director

SYNETRO GROUP LLC4 810 W. Washington Blvd., Suite 200, Chicago 60607 312-372-0840

Pantelis A. “Pete” Georgiadis CEO

P013-P015_CCB_20210823.indd 14

$18,074.0 Public and private pension funds, $15,864.2 endowments, corporations, financial institutions, family offices, high-networth individuals

$1,743.1 Management buyouts, private-equity $366.7 investments

$3,626.9 $3,200.0

$1,284.9 Business services, health care, food $1,564.4 products, technology

$465.0 $460.0

$5,433.0 $3,983.0

$331.0 $331.0

Pension plans, endowments, insurance companies, sovereign wealth funds

Pension funds, insurance companies, family offices

235

NA Health care $384.0

NA NA

Lower-middle-market companies in aerospace and defense, industrial products and services, business services

Middle-market companies involved in later-stage business expansions, corporate acquisitions, recapitalizations, leveraged buyouts

Excl fun

Cr priva firm M port der PE fi saw of th this incre repo In direc mos with a 70 firm’

Comp

VAL 875 312-

VIC 150 312-

VIST 300 312-

WAT 444 312-

Institutions, pensions, family offices, fund of funds, high-net-worth individuals

$200.0 Health care, food and beverage, $121.0 business services

WAU 300 312-

$30.0 $23.0

High-net-worth individuals, small family offices

$7.0 $23.0

Lower-middle-market family-owned manufacturing, distribution and service businesses

WIN 676 312-

$1,752.1 $1,990.5

Pension funds, family offices, foundations, endowments, asset managers

NA NA

Small to midmarket growth equity and buyouts in education, health care services, business services and consumer sectors

$275.0 $250.0

Private investors, institutions

NA NA

Value-added distribution, business services, consumer products and services

$120.0 $83.5

Private investors

$2.9 $4.0

Seed/early-stage internet, software and business services, seed to growth health tech, recapitalizations, buyouts of software, business services and niche branded manufacturing companies

$2,700.0 $1,500.0

1.5

8/19/21 5:37 PM

WIN 980 312-

WYN 6250 847-

This d funds invest

CRAIN’S CHICAGO BUSINESS • August 23, 2021 15

l-time ocal ployees as of 1/2020

Thoma Bravo, S2G top latest directory of private-equity, VC firms Exclusive data includes assets under management, funding sources, number of local investments and more

million, and Pritzker Group Venture Capital has the third-largest fund size of $400 million. The full Excel versions of the directories include 55 private-equity firms and 31 venture-capital firms. Each directory includes data for 2020 and 2019 assets under management or fund sizes, funding

sources, the number of local investments, the number of investments outside of the Chicago area, the amounts invested in 2020 and 2019, plus types of investments and full-time employee headcounts. To see the complete lists in PDF or Excel, become a Crain’s Data

Company

Top executive(s)

Assets under management (millions) as of 12/31/2020; 12/31/2019 Source(s) of funding

New investNew local ments outside investments Chicago in 2020 in 2020

THOMA BRAVO 150 N. Riverside Plaza, Suite 2800, Chicago 60606 312-254-3300

Lee M. Mitchell Carl D. Thoma Managing partners

$76,900.0 Pension funds, sovereign wealth $45,000.0 funds, funds of funds, endowments, family offices

TILIA HOLDINGS LLC 111 S. Wacker Drive, Suite 4960, Chicago 60606 312-535-0225

Johannes Burlin Eric Larson Co-CEOs

TWIN BRIDGE CAPITAL PARTNERS 123 N. Wacker Drive, Suite 1000, Chicago 60606 312-284-5600

Crain’s directories of Chicago’s private-equity and venture-capital firms are back. Most private-equity firms reported an increase in assets under management. Out of the 55 PE firms in the directory, only five saw a decrease in AUM. Fourteen of the 31 venture-capital firms in this year’s directory reported an increase in fund size, and the rest reported no change. In this year’s private-equity directory, Thoma Bravo has the most assets under management, with $76.9 billion. That’s about a 70.9 percent increase from the firm’s reported AUM in 2019. GCM

ISTOCK

Grosvenor has the second-largest AUM figure, $61.9 billion, up 7.3 percent from last year. Adams Street Partners has the third-largest AUM amount at $44.7 billion, a 9.9 percent increase from 2019. GCM Grosvenor and Adams Street Partners remain among the largest employers in the private-equity firms directory, with 298 and 134 full-time local employees, respectively. The second-largest employer—and new to our PE directory—is Monroe Capital with 145 full-time local employees. In this year’s venture-capital directory, S2G Ventures has the largest current fund size of $1.04 billion. Sandbox Industries has the second-largest fund size of $497.6

BY SOPHIE RODGERS

Member and visit Crain’s Data Center at ChicagoBusiness.com/ data-lists, where you will also gain full access to every other list in Crain’s portfolio, including the area’s largest privately held companies, largest law firms, largest banks, largest minority-owned businesses and more.

145

Full-time local employees as of 12/31/2020

Amount invested (millions) in 2020; 2019 Type(s) of investments:

$6,300.0 Application software, infrastructure $8,800.0 software, security software, techenabled business services

$306.8 $152.0

Foundations, high-net-worth individuals, institutional investors

$20.9 NA

Business services across the food supply chain

Joseph Dimberio, Matt Petronzio, Brian Gallagher, Patrick Lanigan Partners

$2,163.6 $1,790.9

Institutional, high-net-worth individuals, endowments, family offices

NA NA

North American small and lower- middle-market buyout funds and companies

VALOR EQUITY PARTNERS 875 N. Michigan Ave., Suite 3214, Chicago 60611 312-683-1900

Antonio J. Gracias CEO, chief investment officer

$7,272.1 $4,547.4

Institutions, pension plans, funds of funds, family offices, high-net-worth individuals

$506.0 Expansion and growth investments in $234.6 tech and tech-enabled industries

VICTORY PARK CAPITAL ADVISORS LLC 150 N. Riverside Plaza, Suite 5200, Chicago 60606 312-701-1777

Richard Levy CEO, co-founder

$3,500.0 $3,000.0

Institutional investors, sovereign wealth funds, foundations, endowments, pension funds, family offices, high-net-worth individuals

$269.4 Investments across select investment $672.4 verticals

VISTRIA GROUP LP 300 E. Randolph St., Suite 4030, Chicago 60601 312-626-1100

Martin H. Nesbitt, Kip Kirkpatrick Senior partners, co-CEOs

$6,500.0 $1,800.0

Foundations, endowments, corporations, pension funds

NA NA

Health care, education, financial services

WATER STREET HEALTHCARE PARTNERS 444 W. Lake St., Suite 1800, Chicago 60606 312-506-2900

Timothy A. Dugan Managing partner

$2,983.9 $2,633.8

University endowments, pension funds, financial institutions, insurance companies

NA NA

Health care

Reeve B. Waud Managing partner

$3,300.0 $3,200.0

Pension funds, insurance companies, foundations, family offices

WAUD CAPITAL PARTNERS LLC 300 N. LaSalle St., Suite 4900, Chicago 60654 312-676-8400 WIND POINT PARTNERS 676 N. Michigan Ave., Suite 3700, Chicago 60611 312-255-4800

Joe Lawler, Alex E. Washington, David M. Stott, Konrad A. Salaber, Nathan A. Brown, Paul H. Peterson Managing directors

$3,466.6 $3,120.6

Pension funds, insurance companies, family offices, fund of funds

NA NA

Consumer products, industrial products, business services

WINONA CAPITAL MANAGEMENT LLC 980 N. Michigan Ave., Suite 1950, Chicago 60611 312-334-8800

Jason Sowers, Director Luke Reese, Managing director Laird Koldyke, Managing director

$350.0 $350.0

Private investors

NA NA

Diverse, lower-middle-market consumer-driven companies

WYNNCHURCH CAPITAL L.P. 6250 N. River Road, Suite 10-100, Rosemont 60018 847-604-6100

Frank Hayes, Chris O’Brien, John A. Hatherly Managing partners

Institutions, pension funds, foundations, sovereign wealth

1.5

$4,416.3 $4,280.9

$800.0 Health care, business and technology $2,000.0 services, software

$400.5 Corporate divestitures, buyouts, $261.2 recapitalizations, late-stage growth equity

This directory is not comprehensive. Includes private-equity firms with offices in Cook, DuPage, Kane, Lake, McHenry and Will counties. NA: Not available. 1. 50 South Capital is a wholly owned subsidiary of Northern Trust. 2. Firm is a private-equity fund-offunds manager. The number of companies and dollar amounts represent the number of portfolio funds to whom it has committed capital. 3. All data is limited to Sterling Fund Management; includes figures for Avathon Capital. 4. Synetro Group is a private investment firm with both venture and private-equity businesses. Data includes all activities.

Researched by Sophie Rodgers (sophie.rodgers@crain.com)

P013-P015_CCB_20210823.indd 15

8/20/21 4:43 PM

16 August 23, 2021 • CRAIN’S CHICAGO BUSINESS

CRAIN’S LIST CHICAGO’S VENTURE-CAPITAL FIRMS Alphabetical directory. Size of current fund (millions) as of 2020; 2019

Sources of funding

New investments New local outside investments Chicago in 2020 in 2020

Amount invested (millions) in 2020; 2019

Targeted industries

Full-time local employees as of 2020

Company

Top executive(s)

7WIREVENTURES 444 N. Michigan Ave., Suite 3500, Chicago 60611 312-357-5468

Lee Shapiro Glen E. Tullman Managing partners

$150.0 $100.0

Strategic LPs, institutional investors, high-net-worth individuals, family offices

$15.9 $23.2

Consumer-focused digital health solutions

ADAMS STREET PARTNERS LLC 1 N. Wacker Drive, Suite 2700, Chicago 60606 312-553-7890

Jeff Diehl Managing partner, head of investments

$385.0 $385.0

Pension funds, endowments, foundations, sovereign wealth funds, high-net-worth individuals

$76.6 $134.0

Venture capital, growth equity, buyouts, credit

134

BAIRD CAPITAL 227 W. Monroe St., Suite 2200, Chicago 60606 312-609-4700

Gordon G. Pan President

$215.0 $215.0

Institutions, pension funds, high-net-worth individuals, employees

$57.1 $44.0

Industrial solutions, technology, services

CHAIFETZ GROUP LLC 455 N. Cityfront Plaza Drive, 13th Floor, Chicago 60611 312-983-3600

Ross Chaifetz Principal Richard A. Chaifetz Chairman

$350.0 $300.0

Richard A. Chaifetz, family office

NA NA

HR tech, SaaS, cloud, fintech, AR/VR, employee benefits, health and wellness, consumer, media, service companies

CHICAGO VENTURES 222 Merchandise Mart Plaza, Suite 1212, Chicago 60654 312-300-4650

Kevin W. Willer Stuart Larkins Rob Chesney General partners

$67.0 $60.0

Instutional and private investors

$7.5 $10.6

Consumer tech, fintech, transportation, logistics, health care IT

CORAZON CAPITAL P.O. Box 2982, Chicago 60654 617-359-3399

Sam Yagan Managing partner

$40.0 $40.0

Private investors

NA NA

Seed, Series A

FIRESTARTER FUND 1 N. Dearborn St., 8th floor, Chicago 60602 312-447-6111

Brian Hand Matt Moog Administrative members

$5.7 $5.7

FireStarter Fund members

$0.0 $0.0

Seed, Series A, Series B

FIRST ANALYSIS 1 S. Wacker Drive, Suite 3900, Chicago 60606 312-258-1400

Oliver Nicklin Chairman

$91.0 $91.0

Institutions, pension funds, family offices, high-net-worth individuals

$17.0 $19.1

HPA 222 Merchandise Mart Plaza, Suite 1212, Chicago 60654 703-909-7467

Peter Wilkins Managing director

$90.0 $75.0

Private investors

HYDE PARK VENTURE PARTNERS 415 N. LaSalle St. , Suite 502, Chicago 60654 260-241-4756

Ira S. Weiss General partner Guy H. Turner, General partner, managing director

IRISHANGELS INC.2 415 N. LaSalle St., Suite 504B, Chicago 60654 773-443-7173

Caroline Gash Managing director

JUMP CAPITAL 600 W. Chicago Ave., Suite 625, Chicago 60654 312-205-8843

$100.01 $100.0

S2G 210 N 312-

SAN 1000 312-

STER 401 N 847-

SYN 810 W 312-

VCA 901 W 312-

VEN 707 O 847-

Technology, SaaS, health care, environmental technology

VITA 415 N 608-

NA $17.4

Digital media, technology, consumer products/services, business and financial services, health care

WIN 231 S 312-

Private investors, public investors, high-net-worth individuals, family offices

NA $19.4

Tech and early-stage tech-enabled businesses, consumer services companies

$42.0 $34.0

Individuals

$7.3 $8.4

B2B enterprise, B2B SaaS, consumer web/ mobile, consumer products

Mike McMahon Sach Chitnis Managing partners

$200.0 $200.0

Private investors

NA NA

B2B SaaS, IT/data infrastructure, fintech, digital media

KB PARTNERS LLC 600 Central Ave., Suite 325, Highland Park 60035 847-681-1270

Keith Bank CEO

$100.0 $41.0

Family offices, sports executives, professional athletes, high-networth individuals

$19.0 $18.0

Sports and technology intersection

LIGHTBANK 600 W. Chicago Ave., Suite 510, Chicago 60654 312-276-3204

Eric P. Lefkofsky Managing partner

$180.0 $0.0

Institutional investors, high-networth individuals, family offices

$22.0 NA

Seed, Series A

LIONBIRD VENTURES 708 Church St., Suite 252, Evanston 60201 847-721-2171

Ed Michael Managing partner

$50.0 $35.0

High-net-worth individuals, institutions

$5.8 $2.5

Digital health, finance, enterprise

M25 415 N. LaSalle St., Chicago 60654 872-205-9775

Mike Asem General partner Victor Gutwein Managing partner

$31.8 $30.0

Endowments, fund-of-funds, family offices, high-net-worth individuals

$3.1 $3.5

Technology, consumer, enterprise

MATH VENTURE PARTNERS 222 W. Merchandise Mart Plaza, Suite 1212, Chicago 60654 312-278-3460

Mark Achler Dana Wright Troy Henikoff Managing directors

$46.0 $46.0

High-net-worth individuals, institutions

$4.5 $11.0

Digital technology

METHOD CAPITAL 900 N. Michigan Ave., Suite 1600, Chicago 60611 312-648-6800

Bill Wolf Managing partner

$122.1 $122.1

High-net-worth individuals, family offices, foundations, institutions

NA NA

B2B software and tech-enabled service companies

MK CAPITAL 1799 Willow Road, Suite 100, Northfield 60093 312-324-7700

Mark Koulogeorge Bret Maxwell Managing general partners

$120.0 $120.0

Institutions, pension funds, private investors

$14.0 $20.8

Software, cloud services

MODERNE VENTURES 410 N. Michigan Ave., Suite 740, Chicago 60611 917-612-0879

Constance Freedman Managing partner

$130.0 $43.0

Family offices, high-net-worth individuals, institutions, strategic partners

NA NA

Seed-stage to Series B in real estate, finance, home services, insurance and hospitality

ORIGIN VENTURES 549 W. Randolph St., Suite 601, Chicago 60661 312-644-6449

Jason Heltzer Alex Meyer Partners

$100.0 $80.0

High-net-worth individuals, family offices, institutions

$15.5 $25.0

Software, marketplace, consumer

THE PALO SANTO FUND 171 N. Aberdeen, Chicago 60607 773-263-5751

Daniel Goldberg Co-founder

$15.0 $0.0

High-net-worth individuals

$7.0 $0.0

Psychedelics, biotech, mental health, addiction treatment

PRITZKER GROUP VENTURE CAPITAL 110 N. Wacker Drive, Suite 4350, Chicago 60606 312-447-6001

Chris Girgenti Managing partner

$400.0 $400.0

Tony Pritzker, J.B. Pritzker

$35.9 $40.1

Seed and Series A enterprise Saas and B2B marketplace technology companies, B2C marketplaces and e-commerce

P016-P017_CCB_20210823.indd 16

Comp

8/19/21 5:35 PM

This d platfo assem

-time ocal loyees f 2020

CRAIN’S CHICAGO BUSINESS • August 23, 2021 17

Company

Top executive(s)

S2G VENTURES 210 N. Carpenter St., Chicago 60607 312-321-8000

Matthew Walker, Chuck Templeton, Sanjeev Krishnan, Aaron Rudberg Managing directors

SANDBOX INDUSTRIES 1000 W. Fulton Market, Suite 213, Chicago 60607 312-243-4100

Matt Downs Nick E. Rosa Managing partners, co-CEOs

STERLING CAPITAL PARTNERS 401 N. Michigan Ave., Suite 3300, Chicago 60611 847-480-4000

Steven Taslitz Chairman, co-founder

SYNETRO GROUP LLC3 810 W. Washington Blvd., Suite 200, Chicago 60607 312-372-0840

Pantelis A. “Pete” Georgiadis CEO

VCAPITAL MANAGMENT 901 W. Jackson Blvd., Suite 501, Chicago 60607 312-690-4171

Leonard A. Batterson Chairman, CEO

VENTANA FINANCIAL ASSOCIATES 707 Osterman Ave., Suite 33, Deerfield 60015 847-234-3434

Size of current fund (millions) as of 2020; 2019

New investments New local outside investments Chicago in 2020 in 2020

Sources of funding

Amount invested (millions) in 2020; 2019

Targeted industries

Full-time local employees as of 2020

$1,040.0 $400.0

Family offices, institutions

NA $86.0

Early- and growth-stage investments in food and agriculture.

$497.6 $449.1

Corporations, institutional investors, family offices

$122.6 $63.8

Stage-agnostic investments across health care, sustainable food and agriculture, insurtech

Primarily invest firm capital as well as third-party capital (often high-net-worth)

NA NA

Small to midmarket growth equity and buyouts in education, health care services, business services and consumer

$120.0 $83.5

Private investors

$2.9 $4.0

Seed/early-stage internet, software and business services, seed to growth health tech, recapitalizations, buyouts of software, business services and niche branded manufacturing companies

1.5

$33.0 $22.0

High-net-worth investors

NA NA

Various

Albert J. Montano Chairman

NA4 NA

Private investors, venture capitalists, high-net-worth individuals

$2.0 $0.5

Early-stage intellectual property

Gale Wilkinson Managing director

$16.3 $16.3

Individuals

NA NA

B2B SaaS, B2B enterprise

VITALIZEVC2 415 N. LaSalle St., Suite 504B, Chicago 60654 608-852-4461

Bailey Moore Managing director

$30.0 $30.0

Balance sheet

$5.1 $3.4

Enterprise software, marketplace, health care IT, e-commerce

WINTRUST VENTURES 231 S. LaSalle St., 3rd floor, Chicago 60604 312-291-2912

$0.0 $0.0

This directory is not comprehensive. Includes venture-capital firms with offices in Cook, DuPage, Kane, Lake, McHenry and Will counties. NA: Not available. 1. Reflects the firm’s three active funds. 2. IrishAngels Angel Network and VitalizeVC share a common platform, Vitalize Venture Group, that encompasses the two entities. 3. Synetro Group is a private investment firm with both venture and private-equity businesses. Data includes all activities. 4. Does not have a standing fund. Each project is individually assembled.

Researched by Sophie Rodgers (sophie.rodgers@crain.com)

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Hyatt hunts for growth at the beachfront slow to come back from COVID lows. Hyatt reported on an Aug. 4 than the corporate road warriors conference call with analysts that that have long been its core business travel revenue in most urban markets has risen to about customers. It’s a shift meant to adapt to the half of what it was in 2019 and just way that the ongoing public health 20 to 30 percent in the largest citcrisis may have changed the hos- ies like New York, San Francisco pitality landscape for good and and Chicago. Sluggish corporate demand one that Hyatt hopes will help accelerate its recovery from a brutal contributed to Hyatt’s $9 million stretch that has pummeled its bot- net loss during the second quarter. That was a huge improvement tom line. Hyatt’s high-end, midweek from the pandemic-gutted second travel-heavy portfolio “is suffer- quarter of 2020, when its net loss ing probably the worst” from the was $236 million, but still far bepandemic among various hotel hind the $86 million of net income types, says Brian Tkac, a former the company generated during executive at Schaumburg-based the same period in 2019. Meanwhile, it’s a far differHostmark Hospitality Group who now serves as director of hospi- ent story among those traveltality analytics in the Midwest at ing for fun. Hyatt CEO Mark real estate information company Hoplamazian said during the call CoStar Group. “It makes sense that that revenue from leisure travel at they’re diversifying, making sure its U.S. hotels in July was nearly 20 their portfolio is not (too heavy) in percent higher than it was during the same period in 2019. THE CHAIN HOPES TO ACCELERATE ITS Revenue per available room—a key metric that RECOVERY FROM A BRUTAL STRETCH. accounts for occupancy and room rate—was one segment of business . . . and down 75 percent at Hyatt’s U.S. resorts in January compared with leisure is leading the recovery.” The bulk of Hyatt’s portfolio the same month in 2019. By June, will remain in full-service, pre- RevPAR had vaulted to 11 percent dominantly urban hotels through higher than June 2019. “The surge in our resorts is unbrands like Hyatt Regency, Park Hyatt and Hyatt Centric even after like anything we’ve previously it adds ALG to its 244,000 rooms. experienced,” Hoplamazian said Demand for those hotels, which during the call. Hyatt had already dipped its rely more heavily on corporate travelers, has been especially toes deeper into the leisure travel HYATT from Page 1

waters in recent years, most notably with its $405 million purchase of Two Roads Hospitality in 2018, whose 12,000-plus rooms at the time beefed up Hyatt’s portfolio of resorts in the Americas and Asia. But ALG, whose roughly 33,000 rooms are mainly spread across properties in Mexico, the Caribbean and Spain including its Secrets and Dreams Resort & Spa brands, doubles the number of Hyatt resorts and is expected to make leisure rooms account for more than half of all Hyatt revenue by 2023, according to a company investor presentation. “This transition to a heavier leisure-driven portfolio has been very intentional,” Hoplamazian said on the Aug. 4 call. Bulking up on leisure travel could also pay dividends for Hyatt’s core business travel customers, says Michael Bellisario, vice president and senior research analyst at Robert W. Baird. Hyatt has needed to add more vacation destinations to its portfolio to boost the allure of its World of Hyatt loyalty program, giving members more fun places to use their rewards. Corporate travelers “might be more apt to stay in a Hyatt to earn points if there are more dots on the map,” Bellisario says. “This gets them one step closer there.” ALG, whose earnings mostly come from managing resorts, also helps with Hyatt’s strategy of owning fewer hotels and relying more

A Zoetry resort near Cancun, Mexico, is one of about 100 ALG resort properties Hyatt will control. on fees from franchised properties and those it manages. Hyatt this week announced it plans to sell $2 billion worth of assets over the next three years—adding to the $3 billion it has sold off since 2017. Its goal is to generate 80 percent of its earnings from franchise and management fees by 2024, up from 57 percent in 2019. Still, leaning more heavily on resorts comes with risk, Bellisario says, in part because business travel has historically accounted for so much more of the overall travel pie nationwide. Hyatt is gambling that corporate business will recover faster than the return to normal levels for vacationers, he says. “You can’t replace a busi-

ness traveler (who stays at hotels) for 50 nights a year with someone saying they’re going to travel 50 nights for leisure.” Also unclear is whether Hyatt overpaid for ALG out of motivation to make a big splash in the leisure market, says Patrick Scholes, a New York-based lodging analyst at Truist Securities. “It’s a long recovery for urban travel, and Hyatt needs to increase its global footprint, and this suddenly became available, and they jumped in,” Scholes says. “I don’t think they got it for a song, but it probably takes the pressure off of their core ownership business because you now have something else shiny to look at here.”

Employers brace for wave of religious exemption claims to vaccine mandates EXEMPTIONS from Page 1 Employers will have to come up with fair standards for evaluating exemption claims. Since religion encompasses a broad range of beliefs, practices and observances, the U.S. Equal Employment Opportunity Commission advises companies to assume a worker’s religious accommodation request is sincere. “Employers are treading into really murky waters if they try to interrogate one’s stated sincere religious beliefs,” says Valerie Gutmann Koch, director of law and ethics at the acLean University of Chicago’s M Center for Clinical Medical Ethics. “There has to be, to some extent, an assumption that individuals are being open and honest about why they’re refusing the vaccine.” But that doesn’t prevent employers from asking for additional information if there’s reason to question the nature or sincerity of a particular claim. Without a road map from the EEOC, how companies go about that process will differ. Lawyers say having set protocols in place is key. One local employer won’t bother analyzing individual religious exemption claims. The Roman Catholic Archdiocese of Chicago, which employs more than 15,000, announced Aug. 19 that it will allow no religious exemptions to its vaccine requirement. The policy is set to take effect five weeks after one of the three shots gets full approval

P018_CCB_20210823.indd 18

from the FDA. The vaccines currently are available under emergency use rules. Most employers aren’t keen to discuss their plans for evaluating religious exemption claims, possibly for fear of helping people manipulate the system. Representatives from some local hospitals and United Airlines declined interview requests. McDonald’s didn’t respond to a request for comment. Companies are expected to deny politically motivated exemption requests, as well as those based on misinformation, including false claims that the shots contain microchips or cause infertility. But the validity of some other requests will be less clear since religion is broadly defined. It encompasses not only organized religions, but also moral beliefs and personal interpretations of passages in sacred texts, says Poonam Lakhani, an employment attorney at The Prinz Law Firm in Chicago. In some cases, “employers are going to have to do a little bit of homework,” Lakhani says. “How is this person practicing these beliefs in other aspects of their life. . . .If somebody says veganism and you see them having a cheeseburger at lunch, I think you could very easily question their motive.” Health care organizations are among the best-equipped to manage religious exemption requests, having long mandated annual flu shots. But even hospital systems say

they’ve refined their processes as they prepare for large numbers of COVID-related exemption requests. Shortly after announcing that all workers and volunteers are required to be fully vaccinated by Oct. 1, Rush University Medical Center formed a committee to manage religious and medical exemption requests. The committee includes representatives from chaplaincy services, infectious disease care, legal and labor relations. “With the COVID vaccine being mandated and there being much more scrutiny and attention on how it’s handled—much more than the annual flu vaccine—we thought this was the perfect time to” create a more robust and consistent process, says committee leader Lisa Weichman Harries, Rush’s director of operations for employee and corporate health services. To ensure the process for requesting religious exemptions is equitable, Rush got rid of a previous requirement that workers submit a letter from their religious organization confirming the sincerity of their beliefs. Employees with approved exemptions will be required to abide by additional safety measures like masking, social distancing and quarantine requirements. Those measures will evolve over time “to make sure the hospital is as safe as possible,” Harries says, noting that 85 percent of workers already are vaccinated at the Near West Side

flagship hospital and Rush Oak Park Hospital. Advocate Aurora Health also has a committee reviewing religious exemption requests. Its job “is not to judge the validity of a religious belief, but to evaluate the connection between the belief and the justification for exemption,” the 26-hospital system says in an emailed statement. “If somebody already asked for an exemption for the flu, it makes sense they would ask for COVID,” Lakhani says. “But if they didn’t for flu, you might question it.” Houston Methodist in Texas was the first large hospital chain in the nation to implement a COVID vaccine mandate, effective June 7. The seven-hospital network had 285 roughly 1 percent of the people— workforce—qualify for a medical or religious exemption. Meanwhile, vaccines have been mandatory for workers at the Chicago restaurant group behind the Berkshire Room and Roots Handmade Pizza since July 15. The Fifty/50 Restaurant Group had fewer than 10 exemptions out of 600 employees, co-owner Scott Weiner says, noting that he granted every request. Some were from pregnant or nursing employees and at least one was for religious reasons. No employees quit because of the mandate, Weiner says, but several candidates walked out of job interviews as a result of the policy. “It’s a little crushing when you’re

a chef who’s struggling to staff your kitchen and you finally get someone who shows up to an interview and doesn’t want the job because of the vaccine,” Weiner says. The availability of three coronavirus vaccines gives employers more leeway in handling exemption requests. For example, an employee who objects to the Johnson & Johnson vaccine because it’s produced with fetal cells could be required to take the Pfizer or Moderna shots, which have been deemed “morally acceptable” by the U.S Conference of Catholic Bishops. When an exemption is approved, an employer has to figure out if a reasonable accommodation of the unvaccinated worker is possible. Some companies will consider telework opportunities. Others will require masking and routine testing. But not all unvaccinated employees will keep their jobs at companies mandating COVID shots. Workers that interact with customers or patients may pose too great a risk for employers. Lawyers say courts tend to side with businesses in cases related to flu vaccine mandates. And it’s even more likely that will be the case with COVID shots. “When you’re in a public health crisis like this,” Koch says, “we’re not supposed to be focused on each individual at the expense of the entire community.” Ally Marotti contributed.

8/20/21 4:54 PM

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Tchen’s Time’s Up leadership draws questions TCHEN from Page 1 Tchen’s continued leadership of the Los Angeles-based watchdog, formed in post-Harvey Weinstein Hollywood by a handful of prominent celebrities including Reese Witherspoon and Ava DuVernay, is raising thorny questions about the extent of her involvement in the Cuomo embarrassment and where the lines can and should be drawn between those who have access to power and those who are expected to hold power to account. “I just don’t think that Time’s Up has any credibility at this point,” said Alaina Hampton, whose lawsuit against the Democratic Party of Illinois in 2018 and #MeToo allegations against longtime Michael Madigan aide Kevin Quinn rocked state politics and spurred legislative reforms. “I think the ties that they have to the Democratic Party are completely inappropriate. And I think that if an organization like this is going to exist, it has to be completely separate from political parties.” A spokeswoman for Time’s Up declined to make Tchen available for an interview, saying the organization had paused all media requests as of Aug. 17. The Washington-based communications firm SKDKnickerbocker, where founding partner Anita Dunn most recently served as a senior adviser to President Joe Biden’s campaign, represents Time’s Up. Hilary Rosen, who co-founded the Time’s Up Legal Defense Fund with Tchen, sits on the board and is an executive at SKDK. In the aftermath of the Cuomo revelations, Tchen issued a series of statements on social media reflecting on her connection with the administration. A New York attorney general’s report says Tchen and the former Time’s Up chairwoman Kaplan reviewed a letter Cuomo drafted to disparage his first public accuser, but Tchen said she didn’t realize the governor’s intent when she was first contacted. Tchen, the onetime chief of staff to first lady Michelle Obama, has since apologized for triggering “pain or harm” in survivors, and Time’s Up says it is reviewing internal processes to regain trust. “I believe we were used as cover for heinous actions going on behind the scenes and, more recently, being used to distract and distort the actual legal and moral violations that occurred,” Tchen wrote in an Aug. 11 statement. “But that in no way excuses my oversight and mistakes in failing to protect survivors and our work, and I recognize that similar scenarios may have played out in the past that I failed to see for what they were.” For Hampton, the apology falls flat. Though Hampton benefited from the Time’s Up Legal Defense Fund—she received $69,935 to cover upfront attorney’s fees in her lawsuit and a monthly stipend of $5,000 to pay for a publicist during the case—she doesn’t feel comfortable referring survivors there anymore. Hampton pointed to Tchen’s 2019 backing of Cook County Board President Toni Preckwinkle for mayor as emblematic of the problem. At the time, Preckwinkle was facing scrutiny for how she handled

BLOOMBERG NEWS

CLASSIFIEDS

æ`ÛiÀÌ Ã } -iVÌ

New York Gov. Andrew Cuomo is leaving office in the wake of sexual harassment allegations. sexual assault allegations lodged against her former chief of staff, John Keller. Preckwinkle fired Keller a day before she declared her candidacy in the mayoral race, but a Chicago Tribune story later revealed that she knew about the alleged incident for six months before taking action. Backing Preckwinkle after that news came out betrayed survivors, Hampton said, and made them wonder if Tchen would prioritize long-held relationships over the experiences of sexual harassment victims who aren’t at the top of powerful organizations. Although Tchen wasn’t serving as the leader of Time’s Up during the race, she was a major player in the organization after co-founding its legal defense fund in 2017. Tchen told the 19th News in an interview last week that she endorsed Preckwinkle in a “personal capacity” and that they’ve worked together for 30 years.

SMOLLETT CASE

Also in 2019, Tchen’s name surfaced in the Jussie Smollett saga, sparking concerns about whether the actor received preferential treatment when authorities concluded he faked a hate crime on himself. During the Chicago police investigation of Smollett’s claims, Tchen contacted Cook County State’s Attorney Kim Foxx to relay “concerns” that the “Empire” star’s family had with the probe. After an email exchange with Tchen, Foxx spoke with the police superintendent and urged him to turn the investigation over to the FBI. That happened as police began to suspect Smollett of staging the attack. Tchen said she was only facilitating the connection because the family was worried about leaks to the media. Smollett was charged with 16 felony counts related to his false report. But Tchen’s interference raised eyebrows after Foxx’s office dropped charges against Smollett in a special deal. Foxx said she recused herself from the case after Tchen’s outreach, but the optics were bad enough that a special investigation was launched. Though investigators cleared Foxx’s office of criminal wrongdoing and determined it wasn’t swayed by outside influence, it identified possible ethical violations. Time’s Up continues to tout its access to the powerful as a strength. In an Aug. 9 statement from Tchen and the board, the organization said those connections help it advocate for women. “We’ve worked to hold power accountable in board rooms, in the halls of government and in organi-

zations big and small, and we have felt uniquely capable of doing so because many of us have worked in those very institutions,” the statement said. “We have never felt co-opted by that experience, only informed by it to try new strategies.” Katie Brennan, another survivor who received support from Time’s Up, agreed that “power building” can help organizations achieve policy or legal reforms but said Time’s Up must put its focus on victims front and center. Brennan knows what it’s like to take on officials from the same political party—she was a campaign volunteer for Democratic Gov. Phil Murphy’s election campaign in New Jersey when she came forward with allegations that one of his staffers raped her in 2017. “It is not convenient to hold allies accountable,” Brennan said. “It’s alarming to feel like your case or your supports or anything else is part of the very web in which you find yourself stuck.” When it comes to Cuomo’s scandal, Tchen’s involvement is also murky. One paragraph in the 168page investigation by the attorney general’s office references Time’s Up and says that Kaplan, also a co-founder of the organization’s Legal Defense Fund, represented Cuomo’s top aide in the probe. The report doesn’t mention Tchen by name but says Kaplan read to “the head of the advocacy group” an op-ed drafted by Cuomo that sought to undermine his first public accuser’s credibility. The report says Kaplan and the Time’s Up leader reviewed the letter, which included confidential workplace complaints about accuser Lindsey Boylan, and offered feedback on what would be appropriate to publish. Some have called for Tchen to resign in light of these revelations. Tchen, for her part, said in a previous public statement that she didn’t realize Cuomo’s intentions when Kaplan called her about the letter. She said she engaged because she worked with the administration to pass laws expanding the statute of limitation for rape victims and thought “his office was interested in doing the right thing for women.” She doesn’t confirm actually reviewing the document and said she learned only later what it was about. A spokesperson for the New York attorney general’s office wouldn’t say whether investigators interviewed or attempted to interview Tchen for the probe. Transcripts of the interviews conducted could shed further light, but the office hasn’t released them yet.

8/20/21 4:40 PM

CRAIN’S CHICAGO BUSINESS • August 23, 2021 21

Cboe expected to sell at some point, CME notwithstanding providing clearing services for the market. Earlier this year, Cboe purFT reported CME offering) is very chased Chi-X Asia Pacific, expanding into Japan and Australia. reachable for a lot of firms.” CME CEO Terrence Duffy, on Cboe declines to comment for the other hand, has refrained this story, as does CME. For Chicago, long the hub of from major dealmaking in recent trading in options and futures on years. CME’s last significant acstocks, stock indexes, commodi- quisition—its takeover of British ties, bonds and almost any other foreign-exchange trading platasset class, a tie-up of the city’s form NEX Group—was in 2018. CME is focused on creating two remaining exchange operators might well be preferable to new products that make futures an out-of-town exchange swoop- trading more accessible to retail investors as well as allow for fuing in for Cboe. The two hardly compete with tures contracts that help manage each other, so the lack of overlap climate-related risks. The stratelikely would mean far less job loss gy is understandable given that than when CME merged with the CME has a virtual monopoly in parent of the Chicago Board of U.S. futures trading. But muted Trade in 2007. And it would es- trading volume amid relatively tablish an even larger global ex- stable interest rates and low volchange headquarters in Chicago atility in stock and commodity prices has dampened interest in rather than losing one of two. The exchanges aren’t the local CME’s stock, although it’s valued jobs engines they once were, but at a higher multiple of projected the two combine to employ 2,400 earnings than Cboe. CME Group shares are up in Chicago. These are two companies, about 9 percent this year, roughly half the rise in the S&P 500. Cboe shares, by contrast, have surged 37 percent “A POTENTIAL ACQUIRER WILL on growth from deals and FIND (CBOE) MORE ATTRACTIVE booming options trading volumes. AS THEY CREATE VALUE.” The “meme stock” craze has pumped up options deRichard Repetto, analyst, Piper Sandler mand since early in the year. That’s when small-fry investhough, going in starkly different tors organizing on Reddit chat boards targeted hedge fund opdirections. Under Edward Tilly, CEO since erators’ short sales of previously 2013, Cboe has been on acqui- moribund stocks like GameStop. In addition to outsize losses sition tear, beefing up its analytics capabilities and expand- for a few high-profile hedge fund ing to Europe and Asia. Next players and heightened scrutiny month, Cboe will open its Euro- on market-makers like Chicapean derivatives exchange, with go-based Citadel Securities, the EuroCCP, the pan-European clear- deeper involvement in the maring operator it acquired last year, kets by forces that before had

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CBOE from Page 3

Cboe has about 30 percent of the U.S. options market, the largest share in the country. dabbled at the fringes has shown some staying power. Average daily volume in S&P 500 index options climbed 50 percent from the beginning of the year through June 30, Cboe told analysts in July. Overall volume has remained high as well. Cboe Chief Financial Officer Brian Schell at an investor conference in New York on Aug. 10 said executives are a bit surprised that industrywide options levels have stayed as high as they were earlier in the year. “We didn’t expect it go back down to 15 million, 18 million contracts per day, but seeing this level sustaining at 30 million, 35 million, it just feels pretty sticky,” he said. Cboe has about 30 percent of the U.S. options market, the largest share in the country. Its average daily options volume in the second quarter was 11.1 million shares, up 12 percent from 9.9 million the year before. The com-

pany is also known for the popular VIX, or “fear index,” which allows investors to bet on future stock market volatility. Tilly, 57, says Cboe will continue to press ahead with its expansion campaign. “We’ll look across the globe, and if the region is competitive, open for competition, we want to take a good, hard look,” he told analysts July 30. “We are also interested in scale. So in the regions that we operate today, we’ll continue to look for opportunities to expand our presence.” Ultimately, that global reach will be enticing to a would-be acquirer, says Richard Repetto, analyst at Piper Sandler in New York. Wall Street still believes in the logic behind the wave of consolidation that has swept up the New York Stock Exchange, among others, over the years. Ever-increasing technology costs can be absorbed by bigger platforms generating higher revenues.

“The acquisitions (Cboe) has made are coming together, and a potential acquirer will find them more attractive as they create value,” Repetto says. In addition to CME Group, the London Stock Exchange, Deutsche Boerse, Intercontinental Exchange and Nasdaq might be interested in buying Cboe, analysts say. An ICE spokesman declines to comment. Representatives of the other companies didn’t respond to requests for comment. Any deal may have to wait a while. The Biden administration’s hawkish stance on antitrust issues, combined with regulatory concerns about how market-makers are executing trades for smallscale investors, could make exchanges leery of bigger mergers in the short term, analysts say. If and when the day comes for Cboe to say yes to a suitor, will it be the one next door or one far away?

Craft beer incubator Pilot Project launches new brews as market growth slows BEER from Page 3 Pilot Project plans to open a larger brewery in the Chicago area by next year, and eventually launch incubators and taprooms—like the one in Logan Square—in other cities. New breweries will enter a rapidly changing industry scarred by the pandemic. In 2020, retail sales of craft beer plunged 22 percent to $22.2 billion, according to data from the Brewers Association, a craft beer trade group. The closure of restaurants and taprooms cut off brewers’ main revenue stream. Though restaurants are back open, industry experts say many are still hesitant to buy big kegs of beer, worried another shutdown will force them to once again dump what doesn’t sell. But the market was slowing even before COVID-19, as craft beers face new competition from hot items like hard seltzer and canned cocktails. Annual sales growth sagged to 6 percent in 2019 from 16 percent in 2015.

P021_CCB_20210823.indd 21

“It has been tougher the last few years,” says Paul Gatza, senior vice president of the professional brewing division at the Brewers’ Association. “You can’t just think, ‘Oh, I’ll open a brewery,’ and everything is going to be fine and dandy. It’s going to be hard. You have to be good at what you do.” Those headwinds could mean Pilot Project’s expansion is coming just in time, says Samantha Lee, co-founder of Hopewell Brewing, located about a mile up Milwaukee Avenue from Pilot Project’s taproom. Lee and her co-founders spent $1.2 million to $1.5 million, including loans, opening Hopewell in 2016. In a post-2020 world, wannabe brewery owners will be less willing to take million-dollar chances on opening their own operation, she says. Pilot Project’s model “works partially because craft beer isn’t where it was 10 to 15 years ago in terms of its growth,” Lee says. “It’s not as sure as it used to be.” Abel says his experience in the

music industry inspired Pilot Project. He worked in several music marketing roles before founding the brewery, including at music gear marketplace Reverb and YouTube. Those companies put power into the hands of the musicians or mom-and-pop shops, Abel says. Pilot Project takes a similar approach, offering small brewers the resources of a big one, he says. Pilot Project’s portfolio companies stay in the incubator 12 to 18 months. During that time, Pilot Project uses the breweries’ recipes to brew their beer, buying ingredients in bulk, and distributing finished product to 250 locations, from restaurants to liquor stores to its own taproom. It collaborates with breweries on recipe tweaks. Pilot Project collects revenue from the sales, while absorbing production and distribution costs. Eventually, the breweries graduate and get their own space or take a different route. Pilot Project takes equity in some of the companies, Abel says. “You come to us with an idea

and by the time you leave, you have all of the data which we package up for you to go out there and make a compelling argument that you’ve got a $5-$10 million business,” Abel says. “When you do go to raise the money to build your brewery, you’re doing it at a much higher valuation.” Pilot Project chooses candidates carefully, rejecting novice brewers who want to whip up a batch for a friend’s birthday party. Abel interviews candidates, looks at applicants’ business and marketing plans and samples products. Pilot Project also needs to keep pace with changing consumer preferences, experts say. Instead of launching new IPAs, more breweries are creating hard seltzers or canned cocktails, says Danielle D’Alessandro, executive director of the Illinois Craft Brewers Guild. “This industry has really created this image and this mantra of meeting the consumer where they are and wanting to be innovative,” she says. “Sometimes that’s challenging for brewers to have to keep up.”

Pilot Project has incubated two hard kombucha companies: Luna Bay Booch and ROVM (pronounced “roam”). Another brewery with a product on tap is Azadi Brewing, which makes Indian-inspired beer. Azadi makes a hazy IPA called Manali, named for a resort town in the mountains of Indian state Himachal Pradesh, which is famous for apple, plum and pear trees, flavors that come through in the beer. Azadi’s Summertime Chai was a collaboration with a brewery in India, and another of its brews uses Gir Kesar mangoes grown in the western Indian foothills. Azadi launched at Pilot Project in November. Modi, who still has his day job, says the arrangement has given Azadi freedom to experiment. “If we learned from customers that they were not interested in Indian beer, we could have stopped and not spent millions of dollars,” Modi says. “That backstop has made it a little bit more digestible during a pandemic.”

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22 August 23, 2021 • CRAIN’S CHICAGO BUSINESS

Facing wave of retirements, big airlines are hiring more new pilots than ever The big U.S. airlines lost about 5,000 pilots to early retirements and voluntary leaves in an effort to trim costs during the depths of the pandemic. At the same time, they were losing about 4,000 a year to mandatory retirements. “They probably retired too many,” says Kit Darby, an aviation consultant in Atlanta who specializes in pilot training and career planning. “If they’d known the recovery would be so quick and so strong, they probably wouldn’t have retired as many.” United alone lost about 800 pilots to early leaves. “They represent a deficit that needs to be met prior to new attrition and future growth,” Brunjes says. Air travel for U.S. airlines is only about 80 percent of preCOVID levels, and there are signs that the latest resurgence of COVID-19 could slow a recovery that had been gathering steam. But airlines are hiring for schedules they plan to be flying next summer, when carriers believe a recovery in business and international travel will be well underway. Big airlines will be able to get enough new pilots to meet their needs as they always have, by poaching from smaller regional

UNSPLASH

PILOTS from Page 3

The major airlines are looking to recruit pilots from regional carriers to fill some of their cockpit needs. carriers, which fly smaller planes and pay about half as much as their larger counterparts. The big airlines won’t be totally spared, however, because they rely on regionals to fly many of their passengers from smaller cities to their main hubs such as Chicago. “I do think you’re going to see, over the next several years, shortages start to show up probably in the smaller carriers,” Delta CEO Ed Bastian told New York TV station Fox5 on Aug. 10. “For

now, no, we’re not having any problems.” Regional airlines pay pilots about $50,000 a year to start, compared with about $95,000 for first-year pilots at mainline carriers. The hiring squeeze began several years ago, pushing up pay rates at smaller airlines. In addition to raises, many regional carriers found themselves offering bonuses of $15,000 to $20,000 a year, Darby says. “While regional airlines will

“Mainline carriers will be be challenged in hiring, they are not surprised by these numbers, competing against each othand every one of our members er for pilots,” says Dennis Tajer, has invested in recruiting, wages spokesman for the Allied Pilots and quality of life, and other pro- Association, the union repregrams aimed at supporting and senting pilots at American. “That attracting future workers,” the hasn’t happened since the ’80s.” For young pilots already on the Regional Airline Association said job, the rebound from COVID in a statement. But COVID-19 slowed the has been among the sharpest repipeline at many aviation coveries ever seen in an industry schools in the short term. The prone to boom-and-bust cycles RAA estimates the number of that often stretch out for years. new commercial pilots in the U.S. Furloughed pilots could see their this year will be down about half incomes cut in half, forcing them to roughly 3,100. Before the pan- to find other jobs until they were demic, United took the unusual recalled. Instead, many young step of buying a flight school it pilots are getting raises because calls Aviate Academy in an effort retirements are accelerating proto train half the 10,000 new pilots motion schedules. it expects to need by 2030. Manoj Patankar, “MAINLINE CARRIERS WILL BE a professor of avi- COMPETING . . . FOR PILOTS. THAT ation technology at Purdue Univer- HASN’T HAPPENED SINCE THE ’80S.” sity, says airlines have been calling Dennis Tajer, spokesman, Allied Pilots Association to ask when the Paul Ryder, a 41-year-old pilot school plans to host in-person job fairs on campus. The school who joined United three years is planning job fairs in the fall ago as a first officer, was just proand spring. “We’re going to see moted to captain, a journey that an accelerated hiring schedule normally takes eight to 10 years. “Last summer, I got a WARN for a couple years,” he says. Consulting firm Oliver Wy- notice notifying me of my imman predicts a shortage of about pending furlough,” he says. “This 9,000 pilots in the U.S. next year, summer, I just received notice of my upgrade to captain.” doubling by 2029.

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CRAIN’S CHICAGO BUSINESS • August 23, 2021 23

You can own an English manor in Hinsdale for $6M For the new house they were building in Hinsdale, Robert and Barb Early had one guiding principle: “We wanted it to look at least 100 years old,” Robert recalls. Habitually clipping and saving images of venerable old Georgians in England and elsewhere, the couple wanted to capture the period’s reliance on symmetry and details picked up from classical Greek and Roman architecture. Now, 20 years later, the house on Fourth Street is set to hit the market. Working with Chicago architect Erik Johnson, the Earlys created a design that includes multiple patterns in the brick exterior to keep it from feeling flat; interior rooms with hand-crafted plaster, wood and window details that make them appear to have been transferred to the site from historical homes; and a traditional English garden defined by orderly rows of boxwood hedges. Although the home is less than 10 minutes’ walk from Hinsdale’s pretty downtown and Metra station, “it feels like England,” said Robert Early, a private investor who specializes in tech startups. Now that their two children are grown, the Earlys plan to downsize into a smaller home in the Chicago area and spend much of their time in Florida. They’ll put the home—six bedrooms and about 12,000 square feet on almost nine-tenths of an acre—on the market soon. It’s represented by Dawn McKenna of Coldwell Banker, and the price is just below $6 million.

PHOTOS BY DAWN MCKENNA GROUP

Designed to look at least a century older than it is, the house is surrounded by traditional garden ‘rooms’ and filled inside with references to classic Georgian style | BY DENNIS RODKIN

MORE PHOTOS ONLINE: ChicagoBusiness.com/residential-real-estate

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MORE THAN EVER, OUR CHILDREN NEED US. Because of COVID-19, hunger has more than doubled. And children are particularly at risk; one in three households with children is facing hunger. As job loss and the continued economic downturn push more people to the end of their resources, many families are having to choose between paying bills or buying food.

In four decades of feeding our community, we have never faced a need so great.

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