Billionaire Steve Case has taken a big red bus through 26 states to bet $150 million on finding the next big startup - here's where he's looked so far
Richard Feloni/Business Insider
- AOL cofounder Steve Case runs the DC-based venture capital firm Revolution and has "Hillbilly Elegy" author JD Vance run his $150 million Rise of the Rest Seed Fund.
- Case is convinced the future of American startups is outside of Silicon Valley.
- For the past four years, Case and his team have gone on seven bus tours, across 38 cities in 26 states.
- This article is part of Business Insider's ongoing series on Better Capitalism.
Silicon Valley has thrived as the hub for tech startups because of the access to capital, talent, and other resources that have developed over years. New York City and Boston, along with neighboring Cambridge, have developed their own strong startups communities for the same reason.This distribution of entrepreneurial talent and money has worked well for the first couple generations of online businesses, but the tides are already shifting, argues Steve Case, the billionaire cofounder and former CEO of AOL.
"We want great returns for the fund but we also want to showcase the companies to others," Case told me, explaining he and his team want the companies they invest in to symbolize the unique opportunities in that specific region.Case hired "Hillbilly Elegy" author JD Vance from Peter Thiel's VC firm and put him in charge of the fund. The fund will be used for about 20 investments every year: the winners of the pitch contests, plus more startups in the Rise of the Rest communities.
In May, the Rise of the Rest team wrapped the seventh tour, bringing its total to 38 cities across 26 states.Here's where most of the VC money goes in the US, according to CB Insights:
Shayanne Gal/Business Insider
And here's where Case and his team invest their money:
Shayanne Gal/Business Insider
And the reason the US should want to see these communities succeed is because he believes they will drive job growth that benefits entire cities. Case cites a 2014 Kauffman Foundation report that says startups account for a full half of all new job creation in the US.
Vance told an audience in Chattanooga, Tennessee that he and his team want to see cities embrace their strengths rather than overly compensate for weaknesses. "I see what's going on in the next wave of innovation, the next wave of technological change, as really depending on things that places like Chattanooga are good at, as opposed to the things that Silicon Valley is good at."These are national scale, maybe even global scale companies," Case told me, referring to highlights of the last tour, even beyond those companies in the competitions. "They just happen to be in Louisville, they happen to be in Chattanooga, so they shouldn't just have regional ambitions. They can go the distance."
- Apple to launch its 'strict' new privacy feature in next iOS 14 beta
- Instagram launches new layout for "Stories" feature for desktop users
- Honda to export new City 2020 from India to left-hand drive markets
- WhatsApp to add additional security layer for users to link account to computers
- AAP to contest elections in Uttar Pradesh, Uttarakhand, Goa, Punjab, Himachal Pradesh and Gujarat in 2022, says Arvind Kejriwal