For many investors, the coronavirus has effectively taken geography out of the equation when it comes to sifting through new opportunities.
While this dynamic opens startups to more investment opportunities, venture capital firms that focus on a specific region find themselves in a more thorny situation. The competitive advantage they once had during the relaunch - the idea of being focused on an area that no one else is - is potentially threatened.
Natasha Mascarenhas, Danny Crichton and Alex Wilhelm of the ProWellTech Equity team discussed the future of geography-focused funds given the improvement in distance investing:
- Natasha: Regional funds early on can win if they stay focused
- Alex: Geography-focused venture capital funds will be weakened, but they won't die
- Danny: geography-focused venture funds are dead (and should never have existed)
Natasha: Regional funds early on can win if they stay focused
Since 2014, Steve Case and his team have taken an annual bus trip across the country to meet startups at emerging startup hubs. Five days, five cities and at least $ 500,000 in investment dollars given to startups. Case would even offer to fly promising, hard-to-reach startups to join the trip.
The Rise of the Rest fund, with over $ 300 million in assets under management, has invested in over 130 startups in 70 cities, including Austin, Chicago, Detroit, Los Angeles, New Orleans and Washington, DC
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