TLDR:
Key Points:
- The Midwest lacks talent and risk capital in the right places to commercialize great ideas, with most venture capital going to coastal cities.
- Universities in the Midwest produce groundbreaking research, but struggle to commercialize it effectively.
In her article, Kathleen Gallagher discusses the disparity between the Midwest and coastal regions in terms of talent, venture capital, and innovation. While cities like Chicago, Minneapolis, Indianapolis, and Pittsburgh have seen some growth in startups and venture firms, the Midwest as a whole lags behind the coasts in terms of attracting investment and commercializing breakthrough technologies. Gallagher points out that over two-thirds of all U.S. venture capital goes to five metropolitan areas on the coasts, leading to the creation of next-gen companies that disrupt legacy businesses with funding often coming from Midwest sources.
Gallagher emphasizes the need for urgent action in the Midwest to address the changing landscape of industries and the rise of deep tech startups. She suggests that Midwest universities, which produce significant amounts of research annually, need to do more to commercialize their breakthrough discoveries. By collaborating with state pension funds and imposing conditions on venture capital investments, universities can ensure that more funding is allocated to commercializing technologies developed in the Midwest.
Furthermore, Gallagher highlights the importance of attracting coastal venture capital firms to the Midwest to help transform traditional industries into high-tech, high-growth sectors. She calls for coordinated action by universities, businesses, and state governments to encourage more coastal venture investment in the region, or risk losing out on talent and money to the coastal oligopoly. Gallagher’s insights point to the need for the Midwest to wake up and take proactive steps to compete with the coasts in the innovation economy.
