We’ve all heard the trope: Silicon Valley is the only place to be if you want to launch a tech startup — the only place where you can secure funding.
Well, the Midwest has something to say about that.
There’s a huge tech boom underway in middle America…
So big, that some predict the region will have more startups than Silicon Valley within 5 years. And it’s fueled by high-profile venture capitalists leaving California for flatter pastures.
Back in 2013, Chris Olsen and Mark Kvamme, then both partners at Silicon Valley-based VC firm Sequoia Capital, decided to relocate to Columbus, Ohio and launch their own firm, Drive Capital.
The Ohio duo have raised $550m and invested in nearly 30 startups
And they aren’t alone: once-sleepy cities across the Midwest are now dotted with “clusters” of startup incubators and accelerators, competing with SV firms like it ain’t no thang.
Comparatively, the big-time Silicon Valley VC firm Andreessen Horowitz sees about 4k pitches per year, and Drive Capital isn’t far behind at a solid 3.8k.
What’s driving the change?
For one, talent is cheaper in the Midwest. A top-notch engineer who would cost $200k+ in the Bay Area can be “had” for a mere $100k in Columbus, and there’s no shortage of skilled workers there.
But we’re also seeing a shift in tech investments toward non-tech sectors like agriculture and manufacturing — areas that Midwestern graduates are well-poised to disrupt.