Recommended: Listen to this story (06:39 - 11:13):

The Story: Venture dollars often stay in venture cities. San Francisco, Boston, New York, and LA are among the leading markets, and you’ll notice they are all coastal cities.

Since venture capital gained popularity in the US, it has always been led by coastal hubs. But maybe not for long. The startup environment in America’s heartland has made big leaps over the last decade.

According to a Heartland Forward report released last week, by the end of 2021, VC investment in heartland states had more than tripled in ten years, reaching over $55 billion dollars.

The region, which consists of 20 states between North Dakota, Ohio, Alabama and Texas, has seen more than 75% of its metros receive investment from 2019 to 2021. According to the authors of the report, “The growth of these ecosystems is not just important for the region, but critical for America's economic future and essential to its prosperity.”

Here’s a few quick highlights of heartland cities that boomed during the recent investment spike:

1. In 2019-2021, Northwest Arkansas saw a 900% growth increase from a decade before.

2. Little Rock saw growth of over 1,000% in the same time period.

3. Three Missouri cities, Springfield, Columbia and Joplin, were all top 15 in the country for small metro relative percentage growth, each growing over 5000%.

Expert Take: Chase Roberts, principal at Vertex Ventures, would love to see middle America continue to grow among venture markets.

However, he does not believe it will happen soon:

Roberts continues, “So let’s say Meta, they had a lot of success as a company, and people within that company see what good looks like and they decide to start companies. We still don’t have enough examples of large enterprise software or large consumer software companies that have been born inside the coast that are generating a diaspora of future entrepreneurs.”

*Stay informed about the three biggest stories in venture capital and tech news every weekday morning. 2-min reads only.