As a Chicagoan and software engineer, here's my honest opinion of tech in Chicago: it's a sad, sorry place to be right now. I grew up in Chicago, went to college in Chicago and work in Chicago. It's been a roller coaster love-hate relationship for 30 years.
There's two major reasons I say it's so sad and sorry: a total lack of experienced, aggressive VC here, and a massive deficit of university-business partnership.
1. Chicago, sans VC
There's a lot of money in this city. There's also a fair amount of capital being thrown around at start ups and small businesses. However, this place lacks having a couple well established VC firms and proper incubators. Without having direct access to solid investors and capital, many of the companies I've seen here flounder and fail. Their boards are comprised of investors who haven't a single clue about how to advise and lead tech companies.
Additionally, tech as a whole is looked as a cheap commodity in Chicago. The salaries are weak, the benefits are meager, and the chance to grow is basically nonexistent. The overwhelming majority of developers I know are either miserable at large companies (banks, trading firms, healthcare, etc) or are being worked to death with virtually no acceptable future benefit at start ups.
2. Universities vs. Business
Let's look at this for what it is in Chicago: the business community and universities do not work with each other. There are so few partnerships for STEM students that it's basically pointless to go to college in Chicago if you're looking for curricula that is directly informed by industry. There's very little in the way of research being done with the guidance of industry or even an objective to productionize/market any of the work.
The universities themselves are also woefully underwhelming: Loyola, De Paul and UIC are basically glorified baby sitting campuses that blindly churn out subpar programmers. UChicago, on the other hand, has a solid engineering school but doesn't promote it at all. UIUC has one of the best engineering schools in the country, but it's two hours south of the city in the middle of a barren corn field. There's also a massive number of smaller liberal arts colleges in the burbs, but they lack exposure, the funding to recruit STEM students and have fewer still business connections in the city.
/rant; begin pep talk:
There's a lot of potential in Chicago, however (which is part of why I've stayed here). All it takes is an honest, concerted effort to get things rolling. As an example, what's happening in the Merchandise Mart and 1871 is a glimmer of hope of turning things around. It's far from perfect, but it's added a small amount of polish and professionalism to a stumbling tech sector in Chicago.
The article also cites a few large exits - which is nice and all, but it's still yet to be seen what is done with that money. Groupon (who I can't stand) turned their capital into a VC and have been building up start ups in the West Loop for a while. Again, it's not amazing, but it's encouraging to see people invest back into Chicago instead of splitting for the coasts.
The talent that is in Chicago is also top tier. One of the other reasons I've stayed here is because most developers in Chicago are very passionate, dedicated professionals. I've been all over the country and met other developers and interviewed in numerous places. I can honestly say that the caliber of talent here is on par with any other more prominent tech scene. What wins it is soft skills: Chicago is made of people who know how to be people. (New York is close second, though)
I believe that Chicago can be reborn as a tech hub, but it's going to take a lot of time, money and commitment to make it happen. This is going to require a lot from the local and state government, business, and universities. But most importantly, it's going to take people believing that it can happen.