Don’t Bet Against The Midwest
If I was to share the following facts with you, what part of the US would you think I’m talking about:
- Represents over 20% of the US GDP
- Nearly 25% of all research in the US is done here and 25% of all patents in the US are granted here
- In the last 5 years, 52 companies that are based here have either gone public or been acquired for over $1 Billion. In total, these 52 companies represent over $140 Billion of aggregate shareholder value
- 1 day car drive to 60% of the US population
While the headline of this post obviously gives it away, most people would see these figures and think of Silicon Valley or possibly the Northeast. But instead, these facts are about the Midwest and its why I decided to plant my own entrepreneurial flag here with Rockfish and The Brandery. And thankfully I’m not alone in that sentiment with stories like:
- “Why Innovation and Startups are thriving in ‘Flyover Country’” in the Washington Post
- “Top Venture Capitalists Leave Silicon Valley, Bet Their Careers On Midwest” in Forbes (a big thank you to Drive Capital who actually gave me the above facts).
Since the downturn of 2008–2009, a pretty amazing entrepreneurial renaissance has started across the Midwest. The stats above prove it and it’s something I’ve watched first-hand since leaving P&G in 2010. When we opened the Rockfish office in Cincinnati, the company had ~70 people total and our office was just three of us. Fast forward to today and Rockfish is nearly 4x that size and the Cincinnati office is now nearly 80 people. And at The Brandery, applications are open for our 6th class and nearly 60% of our past Startups have stayed in Cincinnati after graduation.
Yet the interesting thing is that despite this existing foundation of success, there is untapped potential for the Startup investment community. Case in point is that only 7% of the venture capital in the US is invested in the Midwest. And that is despite that 25% of research here. And despite the $140 billion in aggregate shareholder value created here. Warren Buffett famously said to “Be Fearful When Others Are Greedy and Greedy When Others Are Fearful.” While I don’t believe it is fear in this case, the essence of Buffett’s wisdom holds true when it comes to the potential in the Midwest.
This same untapped potential exists for Brand Marketers as well. The reason 25% of patents are issued in the Midwest are because of our concentration of Fortune 500 (P&G, Ford, etc), research universities (University of Michigan, Northwestern, Ohio State University), and startups. And that means we don’t need to travel across the country to find startups that are driving the next wave of innovation. We can find it in our own backyards by visiting and partnering with Startup Accelerators like The Brandery in Cincinnati, Tech Incubators like 1871 in Chicago, or Midwest based Venture Capitalists like Drive Capital, Hyde Park Venture Partners or Chicago Ventures. We just have to raise our hands and get involved as marketers.
Originally published at www.hardknoxlife.com on October 9, 2014.