Local funds aren’t distributed equally across the United States. Some communities have robust funds for infrastructure development, startups, and small businesses. However, many small to mid-size cities lack this type of risk capital.
Additionally, the post-crisis recovery has been geographically uneven. Research conducted by the Economic Innovation Group outlines this inequality.
A lack of uniform capital markets and/or funds leads to local development that is highly dependent on local investor preferences or communities that can’t adequately resource local startups and small business.
Ross Baird, Entrepreneur-in-Residence at the Kauffman Foundation and co-founder of Village Capital announced the creation of Blueprint Local. Baird also authored The Innovation Blind Spot: Why We Back the Wrong Ideas and What We Can Do About It, which explores gaps in venture funding.
Blueprint Local is an investment platform that allows people to invest in their local economy. The venture acts as a network for local funds that will seek to add 1-2 local communities in 2019. The group is launching one of their first funds in Texas.
Blueprint’s network model is an important development for local economies. Information asymmetry between local economies makes it difficult for locally focused investors to make investments in other markets.
Local investment relies on contextual information such as the history of real estate development and pricing, momentum in specific sectors of small business, and available support resources for entrepreneurs. A network of funds helps make that information available to investors outside of a specific geographic area.