ON “60 MINUTES”: VENTURE CAPITAL HAS FORGOTTEN MIDDLE AMERICA, SAYS STEVE CASE, WHO AIMS TO SPREAD INVESTMENT FROM THE COASTS INTO THE HEARTLAND
AOL co-founder and billionaire investor Steve Case says Middle America is being ignored when it comes to venture capital investment. Case aims to change this situation with “Rise of the Rest,” a fund that will bring some of that venture capital now going to the tech hubs on the coasts and invest it with worthy entrepreneurs in America’s heartland. Sharyn Alfonsi reports on “Rise of the Rest” on the next edition of 60 MINUTES, Sunday, March 17 (7:00-8:00 PM, ET/PT) on the CBS Television Network.
Case raised $150 million to seed his fund and hopes to invest it in places like Detroit, Birmingham, Ala., and Indianapolis. “Seventy-five percent of venture capital money went to three states: California, New York and Massachusetts…Most of the venture capital is on the coasts, not in the middle of the country, and we just have to change that,” says Case. “[Middle Americans] have been forgotten…they have been left behind,” he says. “Most people are not paying attention to them… Most people on the coasts don’t think there’s anything interesting, innovative happening in the middle of the country.”
Case and his team ride a tour bus across the U.S. looking for the ideas and entrepreneurs they want to invest in. They’ve been to 38 cities and 26 states. Alfonsi accompanied Case to Memphis for a pitch competition. Like a talent show, entrepreneurs pitch their inventions in an old church, ideas that included a new auto headlight and a biodegradable medical device. Says Case, “If you care about this city, you have to invest in start-ups.”
The winner of this idea contest got a check for $100,000 to grow their business.
Alfonsi and 60 MINUTES cameras also follow Case’s partner in “The Rise of the Rest,” JD Vance, who wrote the bestseller Hillbilly Elegy. Alfonsi reports on Vance’s efforts in Pikeville, Ky., where they meet Jonathan Webb. Webb founded local business AppHarvest, which is building huge greenhouses to grow produce year round. The fund invested in the company because it has an idea based on its location.
“We can get to 70 percent of the U.S. population in a one-day drive,” says Webb. The new investment will help AppHarvest expand and hire more workers in this distressed area of Appalachia, where jobs are scarce and opioid addiction is rampant. “Folks need opportunity. And if they don’t have opportunity, we are going to continue in that cycle here,” Webb says.
Vance is determined to make a difference and a profit. “We shouldn’t just accept that the story should be one of decline. And that’s what I think-- you know, at its core, what ‘Rise of the Rest’ is about is refusing to see the worst in any place. We want to see the best.”
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