The Secret VC: Midwest Investors, stop celebrating mediocrity

I’ve been checking LinkedIn less and less lately and it’s not because I’ve suddenly achieved enlightenment.

It’s because for a while now, it’s felt like wading into a cesspool; one filled with self congratulatory soap-box gurus, shilling every random thought as ‘best practice.’ Self-appointed thought leaders declare how founders should build, grind, hire, raise, sleep, breathe… all offered with a plate of sanctimony. Sometimes, you even click ‘more’ thinking you’ve found a great insight, and instead get a personal brand exercise wrapped in a Patagonia vest.

I’m over it, but it isn’t necessarily a problem in the Midwest.

No, in our region we have our own, special version. Less grindcore, more backslapping-junket-weilding ‘yay us’ vibes. Because too much of our local ecosystems confuse noise with value. Even then, we neglect to sing the praises of founders when doing so.

On top of that, we have the praise for the panel, the branded photo, the cheerful metric, the ribbon-cutting, the ‘look what we did’ announcements. We celebrate activity so aggressively in my view that we rarely stop to ask ourselves… is any of this actually any good?

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It’s stagnation, Jim. But positively, not as you know it.

I’m not anti-celebration at all, really. I think this place is fantastic and I’m always singing our praises, but I am anti-self-congratulation when it is detached from standards.

These are very different things.

My view is that the best promotion an investor or ESO can have is not their LinkedIn strategy, nor their podcast setup, nor their ability to use a finance acronym correctly. 

It’s what founders say about them when they’re not in the room.

That’s it. That’s the entire ball game.

If the founders you work with in any capacity tell others that you’re useful, honest, responsive, and additive, that is your marketing. If they say you show up when things get messy, that you helped them think better, hire better, close customers, or navigate a difficult funding round, that’s your brand, and it matters more than all the ‘thought leadership’ in the world.

And yet, too much investor communication around here is built the other way around. It starts with the investor's ego, not the founder's outcome. That’s why so much of it feels hollow to me. 

Because, frankly, none of us are as important as we actually think we are.

Too many of us in positions of influence here are acting like regional celebrities in a market still trying to prove it can compound capital. We want the aura of being a big dog before we’ve built the yard or buried enough bones in it. NOTE: That’s a dog analogy to be clear, there are no skeletons in my closet, or backyard.

You know what a serious ecosystem does? While there is competition amongst each other, there is also coordination. When the pie is small, fighting over credit gets you nowhere. Around here I see too many turf wars, too much effort to share it first, too much subtle elbowing for narrative ownership, and waaaay too much obsession with who gets to be the hero.

It’s exhausting and to be honest, it’s also bad communications strategy. Sharing and co-ordinating means a consistent message, joined-up thinking and in social media terms, more reach. Scrambling over scraps is therefore just silly. 

Which brings me to the real reason I share my own thoughts in this way.

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Hey you, if you’re so smart why be anonymous?

I like helping people see things more clearly. I like giving language to dynamics that everyone feels but few people will say. I like empowering founders, and frankly, investors too, by vocalizing hard truths about this industry that might actually make us all better.

But I also have no desire to spend my life defending every opinion against anyone who might confuse disagreement with insight. Anonymity lets me skip the performative online knife-fighting and get to the useful part, and do it quickly.

But the fact that I feel that anonymity is kind of necessary to be able to say what needs saying tells you something about the culture here, doesn’t it? 

In too many corners of the Midwest innovation economy, there is still a lack of open, truthful dialogue. Loud people win. Overt positivity for its own sake gets over-rewarded. The ecosystem is small enough that many people are afraid to criticize anything or anyone because they fear reprisal, exclusion, or being labeled negative. We are so desperate for a win that we start protecting the story of the ecosystem from the truth about itself.

And inside that positivity hides stagnation.

Again: I am not arguing for nihilism. I am not saying we should trash every modest gain. I understand the value of momentum. Small wins do matter, and they should be celebrated. I celebrate more than most, trust me! But they should also be framed properly.

If the numbers show progress, great. The correct response however is not to spike the football and call ourselves elite. It would be better if we asked ‘how much further do we have to go?’ What unlocked this? What didn’t? What would it take to double it again and again? What should our goals even be in regards to capital and exits, and if goals exist are as many people as possible actually aware of them and who could influence them?

Asking questions like these is how serious ecosystems look at themselves. That is how states like Tennessee, Texas, North Carolina heck, even Massachusetts, have managed to build and grow momentum.

For example, one of the most open secrets in our region is that plenty of investors based here deploy a meaningful chunk of their capital elsewhere. I’m not even stating that as moral condemnation, because I don’t necessarily disagree with it. When you’re managing other people’s money, and local deal supply is not sufficient to satisfy the mandate or return expectations, you should go where the deals are.

But then these facts are barely spoken about and nor is the obvious follow-up question: why aren’t there enough deals here of high enough quality to keep more of that capital at home?

Because it isn’t just about a lack of founders, it’s also an issue with our systems.

If local firms live here, benefit from being here, raise the banner here, and then consistently find the best opportunities elsewhere, that should have alarm bells ringing for everyone involved in building the region. Not a scandal nor a witch hunt. A simple conversation, but make it realistic.

Because this is what really matters: I do think the Midwest has enormous upside. I think it is still undervalued. I think there is real talent, real grit, real industrial depth, real technical capacity, and real opportunity here.

But none of that will be fully realized by applauding ourselves for clearing a bar that is too low.

So here’s my message to my fellow investors and ESOs: celebrate founders, not just your role in an announcement. Write with substance or don’t bother. Stop mistaking self-promotion for contribution. Stop treating every incremental gain like proof that we’ve arrived. Tell the truth about where we are. Help build a culture where candor is allowed and in fact, expected. Learn to use the tools that make communication better and easier, and use them well. Coordinate more. Front less. Ask harder questions.

Because the Midwest can do without more cheerleading detached from actual standards. It needs fewer vanity metrics, fewer egos, fewer ads disguised as insight, and a lot more honesty about what it actually takes to win.

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The Secret VC is a genuine and experienced investor, based here in the Midwest. They will remain anonymous as long as they choose to, so please don’t ask us who they are. The goal here is to inform, and share some home truths while we’re at it. If you’d like to submit a topic or questions to be covered by The Secret VC, then go ahead and contact us here.