Economic Development

Comeback Cities Tour Returns to Youngstown

YOUNGSTOWN, Ohio – Repeated trips by venture capitalists to communities like the Mahoning Valley are important to building the relationships that later lead to investments in local companies and startups, participants in the Comeback Cities Tour said Friday. 

The third Comeback Cities Tour concluded Friday with a conference, “Connecting the Coasts to the Heartland,” at the DeYor Performing Arts Center downtown. The tour was aimed at connecting venture capitalists from the East and West Coasts with investment opportunities in the heartland.It also had stops in Columbus and Pittsburgh.

U.S Rep. Tim Ryan, D-13 Ohio, delivered the keynote address at the event, which featured a panel discussion, a speed-mentoring session, a startup investment competition, and a talk about coaching by Youngstown State University President Jim Tressel.    

The venture capitalists “wanted to come back to the Midwest,” Ryan told reporters at a news conference held at the Youngstown Business Incubator following his keynote. Joining Ryan were two of the venture capitalists attending the conference: Patrick McKenna, managing partner of HighRidge Venture Partners, and Roy Bahat, head of Bloomberg Beta.

In February 2018, a year after bringing several venture capitalists including McKenna to Youngstown, Ryan led the first tour, which launched from here and went on to Detroit; Flint, Mich.; and South Bend, Ind. A second tour, which took place six months ago, traveled to Charlotte, N.C., Atlanta and cities in South Carolina.  

“The fundamental is building the connections, building these lasting relationships that result in 300 people showing up for an event like this,” McKenna said.  

“It’s a big validator for us to have Bloomberg and some of these sophisticated venture capitalists here in town,” Ryan said.  “The fact that they saw something here and wanted to come back, I think that says a lot.”

“The moment you show up at a place like this, which was the first stop on the first tour … you realize that if you only come once you don’t really do anything. You’re just a tourist,” Bahat said. “If you want to be able to actually learn something, you’ve got to get to know people over time and develop trust.”

Investors are “pretty simple-minded creatures,” Bahat continued. “We’re like a heat-seeking missile for anything that seems to have momentum. When we see something actually starting to happen, that’s a sign to us that we’re getting warmer and we keep showing up, and hopefully momentum builds on momentum,” he said.

“You’re also seeing progress. You’re seeing the entrepreneurs stepping up. You’re seeing them advance their business models and their thinking,” McKenna said.  

A total of 17 venture capitalists are represented on this tour, Bahat said. The participants include BeyondHQ, a firm he and McKenna are investors in that helps growing companies on the coasts find offices elsewhere in the country. “They’re here specifically to look for locations for expansion as places like San Francisco become just brutal,” he remarked.

One company – which the venture capitalists declined to name — brought about 15 jobs to the Mahoning Valley and is preparing to add another 50 possibly later this year, according to McKenna.

One of the factors that drove the creation of the Comeback Cities Tour was the concern that the country is too divided to solve the “really big problems” it faces, Ryan said. “The reality is it’s going to take all of us coming together as a team,” he remarked. 

Children born in 1990 today have a 75% chance of being worse off than their parents, which he blamed that on “a bunch of broken systems” – health care, economic, environmental, food and others – that were built for a different time and age.

“I’m very concerned about the concentration of wealth but I’m way more concerned about the concentration of opportunity,” he said. “That’s the problem in the United States. That’s the problem we’re solving.”

There are creative, determined people in Youngstown who care about their communities, schools and country, but “don’t have the opportunity to do something extraordinary because we lack the connection to build this thing out together,” Ryan said. Some participants on the first tour had never seen a steel mill, a closed plant or “a community that had been at the epicenter of deindustrialization.”

During the media availability following his speech,  Ryan provided an update on his campaign for the Democratic presidential nomination, which he launched in April.

“It’s going great. It looks like we’re going to be on the debate stage. We’ve got some big announcements here in the next week or so about some national opportunities that we’re going to have,” he said.

He is in ninth place out of the 23-candidate field in the most recent polling in New Hampshire as he prepares to head to Iowa for four days, he reported.

“This is a long, steady march. It’s going to be a grind like all campaigns are,” he said.

Pictured at top: U.S. Rep. Tim Ryan and venture capitalists Patrick McKenna and Roy Bahat speak with reporters at the Youngstown Business Incubator

Published by The Business Journal, Youngstown, Ohio.