According to news on September 18, Steve Case, the founder and former chairman of the media giant America Online (AOL), has set his sights on other American cities besides traditional venture capital centers such as Silicon Valley, and has invested in more than 200 start-ups across the United States, including companies researching ultra-high-speed aircraft and artificial intelligence.
Case was very interested in speed. For example, an aircraft capable of reaching Mach 5 would be able to fly from New York to London in 90 minutes, roughly twice as fast as a conventional Concorde and five times faster than current transatlantic flights.
Case invested in a hypersonic aircraft company called Hermeus. The company was founded by a Georgia Tech graduate and is based in Atlanta, not New York or Silicon Valley.
"They're doing some pretty crazy things," Case said Thursday at an event at PegASUS Park in Dallas' biotech campus. He said Hermeus is taking full advantage of Georgia Tech's knowledge and skills, and Atlanta also has obvious advantages as an aerospace center. "Ten years ago, these graduates might have thought they had to go to California or elsewhere to start a business, but that's no longer the case and they have reasons to choose other cities."
Case currently runs an investment firm called Revolution, which focuses on investing outside traditional venture capital centers, a philosophy Case has adhered to for years. Case has made a lot of money in Silicon Valley over the past decade, which seems counterintuitive. However, as the living, working and financing environment of Americans has changed in recent years, Case's move now looks more forward-looking.
"This will ultimately be a major turning point, and the number of start-ups will accelerate in those up-and-coming cities," Case said in an interview.
After Case resigned as CEO of AOL in 2005, he founded Revolution in Washington, D.C., a few years later. He then merged AOL with Time Warner, a move that drew criticism.
Over the past decade, Case quietly built Revolution, making more than 200 investments across the United States. Among them is Seattle-based CarbonRobotics, which uses artificial intelligence technology to help farmers control weeds. Revolution has also invested in Boulder, Colo.-based MeatiFoods, and Dallas-based sales team productivity platform Arcade and GigWage.
For now, the Bay Area, New York and Boston still dominate the venture capital scene. The three regions will account for about half of the total in 2022, according to data firm Dealroom. About a decade ago, Texas received only about 2% of the nation’s venture capital funding, but now that share has increased to 4%, Case said.
For a long time, the region south of the 37th parallel north in the United States has actively attracted large companies with its vast territory, lower cost of living and low tax rates. For example, electric car manufacturer Tesla will move its headquarters from Palo Alto, California to Austin, Texas in 2021; software company Anplan announced last Wednesday that it will move its San Francisco headquarters to Miami for ten years; Oracle will move its headquarters from Redwood City to Austin as early as 2020.
While big corporate initiatives receive widespread coverage, places like Dallas are less focused on the presence of startups. Case said traditional businesses need to partner with start-ups to create the future of the digital economy.
He said: "We often see this gap between cities, startups are here, big companies are there, and there is almost no connection between the two." "Opportunities are missed." (Chenchen)