Eighty Percent (!) of Venture Capital Investment Goes to Three States — The First Two Are Easy, But We Had Trouble Guessing the Third

Mar 21, 2018  •  Post A Comment

A group of lawmakers wants to end what the group sees as an imbalance in how venture capital is divided up. In a special report in Recode, Rep. Tim Ryan, D-Ohio, and Rep. Ro. Khanna, D.-Calif., write that a “whopping” 80% of all venture capital investment goes to just three states: California, New York and Massachusetts.

“Only 4 percent makes it to the Midwest,” the lawmakers write. “Those lopsided numbers are not representative of the exciting opportunities and projects going on inside the coasts.”

The lawmakers led a delegation of 12 venture capitalists on a tour of heartland cities last month as part of an effort to get more investment flowing to those cities.

“Our country faces an ever-growing number of challenges in the 21st century, but all too often our political dialogue can’t even begin to scratch the surface,” the lawmakers write. “While Washington remains mired in its usual partisan fights, entire communities across the country — especially in the Midwest — have been locked out of an economy that has moved away from the manufacturing base that helped build the strongest middle class the world has ever seen.”

The report adds: “Though it may not always feel like it, we have the perfect opportunity right now to help rebuild and rejuvenate struggling communities by connecting them with resources traditionally concentrated on the coasts — resources that can help retool their local economies and promote sustained growth and development.”

One Comment

  1. Venture Capital goes to where the opportunities are. If the midwest starts offering new ideas with potential for growth, then the money will go there. The last thing this country needs is politicians managing the venture capital to support their constituencies rather than the best opportunities for new business.

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