Underserved areas are becoming hot, hot, hot, from the standpoint of venture capitalists and their own backers.
In October, Steve Case’s Revolution announced that a second Rise of the Rest Seed Fund had closed with $150 million in commitments. In November, Drive Capital, a Columbus, Ohio-based venture firm that was started by two former Sequoia Capital partners and focuses on largely Midwestern startups, revealed in SEC filings that it had raised a fresh $350 million in capital commitments across two funds. Meanwhile, last month, Hyde Park Ventures, a Chicago-based early-stage software-focused venture firm that’s focused on the “mid-continent,” announced on Medium that it had closed its third fund with $100 million.
Now, author and investor J.D. Vance — who rose to fame after penning a memoir (“Hillbilly Elegy”) but who has also worked as an investor, including as principal for Peter Thiel’s Mithril Capital Management and more recently as a managing director with Revolution — has swung open the doors of his own Midwest-focused venture fund, Narya Capital, based in Cincinnati, Ohio.
The outfit has so far raised $93 million in capital commitments for its debut fund, and its investors include Thiel, along with some other heavyweight names, including Marc Andreessen, Eric Schmidt and ExactTarget co-founder Scott Dorsey — who also now runs a Midwest-focused venture firm and startup studio.
Vance isn’t talking publicly yet about the fund — it’s still in fundraising mode — but judging by an SEC filing first flagged by Axios, he isn’t going it alone. Colin Greenspon, who was partner at Rise of the Rest Seed Fund and a former managing director at Mithril, is joining him as co-founder and partner.
According to the outlet Columbus Business First, the two are also joined by partner Falon Donohue, who spent more than four years as the CEO of VentureOhio, a nonprofit organization that aims to increase access to venture capital for Ohio entrepreneurs. Donohue had also started a seed-stage venture firm in Columbus called Sadie Ventures back in 2018.
The firm’s SEC filing shows a target of $125 million.
Its name — like that of Mithril — derives from the writings of J. R. R. Tolkien. While mithril is a fictional metal, Narya is a magical ring that (according to fan pages) has the power to inspire others to resist tyranny, domination and despair.
According to data from PitchBook and CB Insights in association with Hyde Park Ventures, the Midwest has seen a meaningful uptick in venture investment in recent years, jumping from $2.7 billion in 2016 to $4.3 billion by 2018.
Other funds to close in recent times include Great North Labs, which closed its first fund with $23.7 million in capital last June to invest in early-stage tech startups across the Upper Midwest in the U.S. As we reported over the weekend, a firm that invests expressly in startups from “Park City to Kansas City” just attracted more than $16 million in backing for its newest fund, too.