What Headlines Aren’t Saying About Raising Capital in the Midwest
If you start a tech company in the Midwest, you’re at a disadvantage for raising capital. That may sound harsh, especially when compared to recent headlines:
Cincinnati: SaaS Capital Files for Third $75M Flagship Fund
Detroit: Ford Plans to Spend $4B on Autonomous Vehicles by 2023 (that includes a $1B investment in Pittsburgh startup Argo AI)
But such headlines can’t hide that the Midwest still lags far behind the rest of the nation in funding. A recent article from The Hustle estimates only about 5% of VC funds reach the Midwest. Pitchbook’s Venture Monitor 2Q 2018 show the Midwest taking only 1.4% of national deals (for 0.3% of national deal value).
So What Now?
That’s not meant to paint a grim picture. Rather, we need to realize that this is a pivotal time for Midwest entrepreneurs. We’ve seen that the Midwest can build billion-dollar companies. But there are so many questions we have to answer about realizing and sustaining that success:
- How can we make it simpler and faster for deserving founders to get the funding they need to grow?
- How do we give our most capable leaders the support they need to make the leap into building fundable companies?
- How do we get more money invested off the sidelines of the Midwest so more of the wealth created by large exits stays and reinvests in the Midwest ecosystem?
These aren’t easy questions. Answering them won’t be easy, either. But we’re figuring out how.
Learn From Those Who Came Before You
A great place to start: the success stories that have already happened. VC Don Aquilano knows them. Those stories (and the ones waiting to be told) are why he co-founded Allos Ventures on a two-sentence mission statement:
“The Midwest is starting to get the recognition it deserves. There’s just one problem: too many good ideas, not enough money.”
Don, who managed funds at NYC firms before co-founding Allos, is the perfect person to lead founders and investors in a conversation about raising capital in the Midwest.
“How to Fundraise in the Midwest”
That’s why we recently hosted a special podcast recording with Don in front of a live studio audience at our offices in Industrious Indianapolis. It’s called “How to Fundraise in the Midwest.” We also invited two Midwest founders into the conversation, each at different stages of raising venture capital: Shwetha Pai, co-founder and CEO of OrgAnalytix, and Brian Powers, founder and president of PactSafe.