A structural misallocation across most of America.
The largest untapped opportunity for durable venture returns. A geographic and economic framework that names a persistent, multi-decade mispricing of capital.
Despite representing the majority of the nation's population, labor force, research institutions, industrial capacity, and real-economy output, the states that make up The Great 38™ receive a disproportionately small share of venture capital investment relative to their economic contribution.
This imbalance is not explained by talent quality, entrepreneurial intent, innovation output, or economic fundamentals. It is explained by capital concentration dynamics.
The Great 38™ framework exists to name, define, and correct this structural inefficiency.
States across the South, Midwest, Mountain West, and Southwest census regions.
AL · AR · DE · DC · FL · GA · KY · LA · MD · MS · NC · OK · SC · TN · VA · WV · PA
IL · IN · IA · KS · MI · MN · MO · NE · ND · OH · SD · WI
CO · ID · MT · NV · UT · WY
AZ · NM · TX
- The majority of U.S. landmass and logistics corridors
- Over half of U.S. GDP and employment
- A disproportionate share of energy production, manufacturing, healthcare delivery, agriculture, and advanced industrial output
- A dense concentration of public research universities and R&D institutions
- Yet they receive a minority share of venture capital deployment, particularly at Series A and beyond.
- +A structural capital allocation failure, not a regional deficiency
- +A long-duration economic distortion, reinforced over decades
- +A venture market inefficiency, not a cultural or political narrative
- +A mispricing of durability, capital efficiency, and real-economy leverage
- +A compound loss of national economic potential
- −A commentary on ideology or partisanship
- −An argument against coastal innovation hubs
- −A claim that talent is evenly distributed — but that opportunity is not
- −A short-term cycle or post-pandemic anomaly
Venture capital has become structurally more concentrated, not less.
Multiple longitudinal analyses show that U.S. venture capital has become increasingly geographically concentrated, with a small number of coastal metros capturing the majority of late-stage and mega-round funding — even as startup formation and early-stage activity broaden nationally.
By 2024: fewer than five states captured the majority of venture dollars; emerging and regionally anchored funds declined sharply; capital recycled toward familiar networks rather than underwritten fundamentals.
Source: composite of public VC reports — pending re-verification.
States within The Great 38™ produce a substantial share of U.S. patents and applied research, host major public research universities and medical systems, lead in sectors where innovation is operational, and generate high rates of first-time and necessity-driven entrepreneurship. Yet founders in these states experience smaller average check sizes, longer fundraising cycles, fewer follow-on rounds, and higher likelihood of forced relocation to access growth capital.
This is not a pipeline problem. It is a throughput problem.
High-potential companies stall or exit early due to capital constraints, not market failure.
Over-concentration amplifies systemic risk by correlating portfolios to the same geographic, labor, and cost structures.
Founders and skilled operators relocate to capital centers, weakening regional ecosystems and reinforcing concentration.
When most of the economy compounds slowly while a few regions overheat, aggregate resilience declines.
These attributes maximize survivability and compounding — not velocity.
Read the Enduring Capital framework- Lower burn multiples
- Higher revenue discipline
- Stronger labor retention
- Asset-backed scalability
- Structural cost advantages
- Longer operational runways
- ·Pattern recognition over underwriting
- ·Network density over market fundamentals
- ·Speed of exits over durability of value
- ·Familiarity over variance-adjusted return potential
Capital flows where it is already concentrated. This reflex reinforces itself.
Reprice geographic risk and opportunity as a first-order variable in portfolio construction.
Contextualize capital scarcity as a structural condition, not a signal of founder quality.
Inform LPs seeking durable, diversified exposure beyond overheated markets.
Align capital deployment with where economic output and innovation actually occur.
The gap between where capital flows and where value is built.
It is not a call for redistribution. It is a call for better underwriting.
Capital that seeks endurance rather than velocity must eventually move beyond familiarity and toward fundamentals. Understanding The Great 38™ is the first step toward reallocating capital for what actually endures.