Go Midwest, Young Fintechs

When John Gibbons clicked on a website for a startup generator in the Midwest last summer, he wondered at first whether it was a scam.

Yet he wasn’t asked for his Social Security or credit card number. Its pitch to help those selected create fintechs in the city of his alma mater, Notre Dame, was compelling. And the visa allowing him to live in Bangalore, India, was running out. So Gibbons applied for INVANTI’s inaugural six-month program in South Bend, Ind., for aspiring entrepreneurs.

He was accepted, beginning a journey shared by other entrepreneurs hoping to improve grass-roots banking Des Moines, Iowa, Kansas City, Mo., and small cities and towns around the region. Some, like Gibbons, are drawn to existing community programs. Others are staying put or boomeranging back to fill jobs that established fintech companies, like Dwolla, are supplying. Some will visit the Midwest because banks, like nbkc bank, are beckoning them there with fintech accelerators.

By graduation from the program, Gibbons had partnered with Jada McLean, a transplant from New York City, to found Hurry Home, an early-stage startup that helps finance home purchases that traditional banks would not consider profitable enough. The company has since been accepted into Techstars Chicago. It is also preparing to run a small-scale pilot in Indiana. Its fate is far from known, but Gibbons says Hurry Home is committed to having some sort of presence in South Bend because of what the community has offered: its start.

“The city has been so important for us in getting going,” said Gibbons. For startups, they are not the obvious places to settle down. While fintech is flush with venture capital, three states- California, Massachusetts and New York- gobble up 75% of all VC funds. Yet if there is a good time to go against the odds, it might be now. These days, it has become fashionable for venture capitalists to say they are scouting for opportunities beyond the coasts.

Most visibly, Revolution’s Rise of the Rest seed fund, co-founded by AOL co-founder Steve Case, continues to make a splash by investing in all kinds of startups across America to promote growth and increase investment capital. As Case blogged, “People know that the future of America is tied to more than just three cities, and there is an eagerness, now more than ever, to address the investment gap.”

Dustin, Mix, co-founder of INVANTI, says the Midwest offers venture capitalists what their careers depend on: looking at things differently. As Mix sees it, the Midwest is ripe with untapped opportunities that differ from those in San Francisco. “It’s not just a copy-paste,” Mix said.

Source: Read the full article in American Bankers written by Mary Wisniewski