The growing popularity of web and phone applications has caused the number of tech startup companies to increase in the city of Chicago.

A startup is a company that is generally still in the early stages of development, looking for new ways to improve, build and fund their business in a way that puts them on the market.

While San Francisco is considered the tech capital of the world, Chicago has been rising up with the recent boom in apps and tech startups. Chicago comes seventh in the top 10 cities for tech startups thanks to successful companies like Groupon, Orbitz and GrubHub, according to USA Today.

Chicago’s online startup community, Built In Chicago, reported that funding for Chicago startups increased by 169 percent from 2012 to 2013, with more than $1 billion in funding. It was also reported that there were 214 startups launched in 2013 in Chicago.

Software Engineer Abhishek Pillai, 24, joined discount-hub Groupon in May 2012 and keeps up with many other startups around Chicago.

“Chicago is definitely the second or third best place in the US to start a company,” Pillai said. He also said that Chicago provides many opportunities for tech startups to thrive, such as universities with Computer Science and Design programs, existing tech companies with a large influence and a “high density population with lots of tech-savvy people.”

One of Chicago’s newest startups called ThreadMeUp was created by three college students in a DePaul University classroom.

ThreadMeUp is an online platform for designing, ordering and crowdfunding custom apparel, and was created by Ramzey Nassar, Cory Keane and Paul Salvucci. According to ThreadMeUp’s Director of Business Development Isha Hamdani, most of ThreadMeUp’s employees range from ages 20 to 24.

“At ThreadMeUp we don’t believe resumes and grades are the best way to determine a candidate,” Hamdani said. “The rest of the team was selected based off of experience and motivation. When we hire…we are more interested in speaking with candidates so we can understand them better as individuals.”

Hamdani also agrees with Chicago’s potential to be a startup hub.

“I think there is a lot of momentum that needs to be channeled in Chicago,” she said. “The community is vibrant and the knowledge here is incredible. I think Chicago will continue moving forward as a major startup hub in America.”

Senior and Chemical Engineering student at Illinois Institute of Technology Rani Shah acknowledged Chicago’s advantages as well.

“The city has a variety of small and large businesses, tech savvy professionals, and a crazy amount of access to universities and museums…if the city and Chicago universities continue their support of startups I think we’ll be in a great place soon,” Shah said.

While Chicago is booming with tech startups all over the city, there can be potential problems that come along with it. Some of these problems may include loss of trust in the startup company and fear of the eventual drop in demand.

“The only issue I see with the startup boom in Chicago is that it must be sustained if we want to be even remotely on par with the West Coast culture of startups,” Shah said. “If the city and local universities don’t sustain a giant push to support startups then I don’t think this ‘boom’ will last long.”

“If a lot of these startups fail, investors and users will be fearful of investing and taking risks in startups like in 1999,” Pillai said.

With this in mind, it is important for college students and young adults to understand what goes into a successful startup company. When thinking about beginning a tech startup, there are multiple components that go into the idea.

Pillai said what goes into a successful startup is a talented team, service with real value, quick feedback and a strong, focused vision.

“The one piece of advice I would give is to do what we did to get off the ground and that is bootstrap,” Hamdani said. “This means figuring it out without thinking you need a ton of money to bring your idea to life. Be creative and resourceful in your pursuit…utilize Chicago’s business leaders and networking events.”

“I think any type of startup culture is important today because understanding that the first step to success is failure is a very important concept,” Shah said. “Tech startups spur creativity and while the startup itself may fail, the face that a new, better idea might come along is all worth it. Being part of a new company allows students to understand how things actually work; the classroom provides theory, not life lessons.”