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Steve Case Encourages More ‘Revolution’ Outside Silicon Valley

Lately it seems trendy for VCs to say they’re looking to invest outside of Silicon Valley. At least that’s what we’ve been hearing from more of them.

So we decided to ask someone who has actually been doing it for years what he thinks.

“We’re delighted that there’s a bandwagon forming,” Steve Case told Crunchbase News.  “We’ve been hoping for that for a number of years.”

Case is the founder of the Revolution trio of funds (including Rise of the Rest) that are exclusively focused on investing outside the major hubs of Silicon Valley, New York and Boston. 1

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Since launching the  Rise of the Rest platform in 2014, Case and company have invested in 116 companies and traveled to 38 cities by bus. (When asked which of the locales is his favorite, Case joked that it was like having 38 children. He couldn’t pick just one.)

Rise of the Rest makes a stop in Birmingham, Ala. in 2018.

The fund is an extension of personal seed investments Case was making individually in startups in “emerging communities” that he discovered while working on the Startup America Partnership under former President Barack Obama. All three Revolution funds are based in Washington, D.C.

Case, who also co-founded internet provider AOL in the mid-1980s, decided in 2017 to launch a formal investment vehicle to further his mission. His team now travels to various cities with the goal of investing $100,000 in a local startup at the end of the day. The $150 million Rise of the Rest Seed Fund is backed by an illustrious group of investors and executives, including Amazon founder Jeff Bezos, former NY Mayor Michael Bloomberg and former Hewlett-Packard CEO Meg Whitman. They have all ”publicly committed to the idea that great companies can be scaled in cities outside of Silicon Valley.”

For clarity: Going forward when we refer to “Revolution” we are talking about the trio of funds unless we specify otherwise.

Over time, Case has followed through on his intentions. Across all three funds (including the Rise of the Rest Seed Fund, Revolution Ventures and Revolution Growth), 98.5 percent of total invested capital has gone to companies outside of Silicon Valley.

In 2018, Revolution made 135 investments, including follow-on rounds. Of the 103 companies in which the funds invested in 2018, 102 were based outside of Silicon Valley. The markets that saw the most investments in 2018 included Austin, Chicago, Detroit, Los Angeles, New Orleans, and Washington, D.C.

“From an investment standpoint, we think certain places like Silicon Valley have tons of great people doing tons of interesting things,” he told Crunchbase News. “It also has tons of VCs. So the valuations are sometimes high. In markets with a different supply-demand dynamic, the valuations tend to be more moderate.”

While Rise of the Rest (ROTR) is too early-stage to have seen any exits, one company Case invested in prior to its being formed did get acquired by Amazon in late 2016: Partpic, the pitch competition winner during a stop in Atlanta. (Sidenote: Since the Atlanta stop was before the ROTR Seed Fund’s formation, this was a personal investment from Case not from the fund itself.)

However, the Revolution funds as a whole did see four exits in their portfolio in 2018 with Handy, SRS Acquiom, SpareFoot, and Booker. Other successes included portfolio companies Tempus and Sweetgreen reaching unicorn status. Last year, Revolution also hosted two conferences for startup founders and leaders. Additionally, it launched a new video series.

Looking Forward

For years Case has been vocal about his belief that with “the next wave of entrepreneurship,” the center of gravity will shift from Silicon Valley to other parts of the country. To Case, the current “capital imbalance” that exists is both “a problem to solve and opportunity.”

“A majority of venture capital goes to three states,” he said. “We think that’s crazy…There’s a lot of people and places feeling left out and behind.”

As a result, he continues to target underserved markets, with the goal of attracting national attention to the startups in those regions while also raising their profiles locally. At the end of April, the Rise of the Rest tour is headed to Florida and Puerto Rico, its first foray out of the mainland U.S.

Its next stop is Orlando, which has traditionally been known as a hospitality hub with Walt Disney World. Then, the tour will hit the Space Coast, where for the first time, Rise of the Rest is branching out.

“We’re not just inviting people from the area (to the pitch competition),” he said. “We’re inviting anyone with a space-related startup to apply, and are flying the best ones there.”

Case is also eager to visit Miami, which he described as “quite a global city,” and hurricane-ravaged Puerto Rico.

“There’s a lot of excitement around rebuilding the economy there and creating a more sustainable, self-sufficient future for the island,” he told Crunchbase News.

From The Startup POV

Cody Barbo, co-founder and CEO of San Diego-based Trust & Will, said he was introduced to Rise of the Rest through Ryan Kuder, the director of the Techstars Anywhere program. Barbo’s company went through that program in 2018.

Kuder was on the bus with Rise of the Rest in Birmingham, Ala. around the same time Trust & Will was gearing up for its seed raise.

“I saw him tweeting about it and asked for an introduction,” Barbo said. Trust & Will helps individuals and couples set up a trust-based estate plan, document their wills, and designate guardians for children or dependents.

Ultimately, Rise of the Rest invested in Trust & Will’s $1.5 million seed round, an experience Barbo said has been transformative in several ways.

“They have this emotional IQ you don’t always get from other VCs, as they’re investing in people more than anything, especially at the early/seed stage,” he said. “The amount of support they pour into founders is amazing.”

The firm’s personal approach has made Barbo and his team feel nurtured.

“One of the things about the Revolution team is that all of them connected with me on LinkedIn and have shown their support through that channel and other social media such as Twitter,” he said. “That sharing and retweeting is nice validation. It feels like they really care.

Another example of the fund’s personal approach is a book club which provides materials to all startup founders.

“To have a little bit of a mentorship through a book club is not as common among traditional VCs,” Barbo added. “It seems very unique…We just have these little boosts of support in the smallest of interactions.”

Whether it’s through a program as simple as a book club or direct financial investment, Case’s initiatives aren’t just about providing support outside Silicon Valley, according to Case, they are about providing support to the individuals behind the companies and that is a revolution worth getting behind.

Photos Courtesy of Revolution


  1. The Rise of the Rest Seed Fund typically focuses on early-stage investments outside of Silicon Valley, NYC and Boston of up to $1 million. Revolution Ventures makes investments of typically $2 million – $10 million in venture-stage companies. Revolution Growth targets later stage companies with a typical investment size of $20 million – $50 million.

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