Illinois to Tech Companies: Please Come to Illinois so our Politicians Can Shake You Down for Campaign Contributions
Crain’s is running one of its vapid analysis of survey results, written by Greg Hinz (one of it’s most vapid analysts), claiming that downtown Chicago is sure a great place to do business, especially tech business.
tech-sector employers say that to attract talent, they need to cluster within that two-mile radius of City Hall, too
Yet, Chicago does have it’s earnest businessmen and politicians putting up interesting places to work, like 1871, the technology incubator in the Merchandise Mart. I’ve toured it, and met with several people there, and it really is impressive, yet inexpensive for start-up technology companies.
Having led a really large startup in the Chicago area (as well as participating in several smaller ones), I have found Chicago to be a real challenge. There are plenty of talented people here. The support systems of lawyers, accountants, real estate people etc is much more competitive and competent than the West Coast. The weather/geography is to my liking, as well as many thousands of graduates of big engineering universities, like Illinois, Purdue and Michigan. In a reasonably run State, we could see a critical mass of companies, building the next Google or Facebook right here in Cook County, right?
No shocker, we are not in a reasonably run state. Despite every well intentioned political/business types, we have a political system that thrives on making legitimate business difficult and more intertwined with politicians and lobbyists. Here is a news story (that somehow escaped Crain’s) that broke Friday and got a bit of press over the weekend.
Mobile payments company Square appears to have just received a cease and desist order from the Illinois Department of Financial & Professional Regulation. You can access the document here
Yes, Square, the company which processed around $10 Billion in small-business transactions last year using the swipe mechanism that plugs into your Android or iPhone, has been ordered by our State to Cease and Desist from operations in Illinois. Square has grown large enough to get attention from our State, not that Square wants the attention.
What is it that the State wants? Here is a previous document produced by New York for pretty much the same “violation” that Illinois is hitting Square with. You might note that the New York charges were sent about a month before the planned IPO of the company being charged, forcing a quick settlement (instead of a scuttled IPO). The charges are as clear as mud, read them at your own risk, but here is a big rub
Square shall be LIABLE to the Department in the amount equal to four times the amount of unlicensed money transmissions in Illinois, as provided by § 90(i) of the Act.
or, at 1/25 of $50 Billion x 4….Square is liable for $8 Billion in fines to the State of Illinois for daring to do business in our State in 2012.
Nothing welcomes technology business to our State like a proposed $8 Billion fine. If Illinois was serious about attracting business, they would give away licenses to do Square-type business, rather than threatening a legitimate company with absurd fines and restrictions.
John Powers is the President of the Chicago Daily Observer, and a long time technology investor.
image Board meeting at the Illinois Department of Commerce and Economic Opportunity