J.D. Vance Investor Tour Draws Hopeful Companies And Harsh Critics
J.D. Vance, author of the best-selling memoir “Hillbilly Elegy,” returns to his native Kentucky this week. But Vance isn’t selling books this time. He’s leading a bus tour of well-heeled venture capitalists looking for investment options in the region.
Vance worked with AOL founder Steve Case to line up big-name investors for what they call the “Rise of the Rest” tour. Vance is now managing partner for the Rise of the Rest Fund, which names Jeff Bezos of Amazon and former Google executive Eric Schmidt among its investors.
Vance said “the rest” applies to anyone outside the Silicon Valley, Boston and New York tech centers, the places that take up about three-quarters of venture capital investment.
“To us the ‘rest’ is pretty much everybody that’s struggling over that small pot of money,” Vance said. “If only three states are getting most of the venture capital, that means only three states are getting most of the net job growth.”
A previous tour rolled through Detroit and other industrial Midwest cities. This leg includes Birmingham, Chattanooga and a May 11 visit to Louisville. The stops feature pitch contests for a select group of hopeful candidates vying for an investment of up to $100,000.
But Vance said the main purpose is to raise visibility for the “entrepreneurial ecosystems” in parts of the country that the economic recovery has left behind.
“We don’t think Rise of the Rest will solve all the economic problems for the entire region but we think and we have a lot of confidence that it will help,” he said.
Since Vance’s memoir about his dysfunctional family hit the best-seller list, he’s become a go-to guide for media outlets seeking an explanation for all things Appalachian. He’s a regular on cable news programs and wrote several columns for The New York Times.
But Vance also attracts critics who say he blames the poor for their own predicament.
Negative reviews of “Hillbilly Elegy” say Vance’s focus on personal choice ignores the region’s larger economic problems that limit people’s options in the first place.
“Elegy is little more than a list of myths about welfare queens repackaged as a primer on the white working class,” Sarah Jones of the New Republic wrote in one typically scathing review.
Historian Elizabeth Catte’s “What You Are Getting Wrong About Appalachia” is a book-length rebuttal to Vance. When Vance spoke at a recent Appalachian studies conference Catte joined some audience members who turned their backs on him in protest.
Vance is taking the criticism in stride.
“I think people are justifiably a little weary of one guy serving as a representative of the region,” he said. “But I also think there are a lot of folks who do identify with what I wrote and what the book is about.”
Others have concerns about whether the venture capital Vance now promotes is the right fit for the region he wrote about.
“This is a place where investors have shown up time and again and they took their rate of return on capital and they left behind a mess,” Dee Davis said. Davis founded the Center for Rural Strategies in Whitesburg, Kentucky. He compares venture capitalists, with the high rate of return they often seek, to the extractive industries that pulled so much wealth from Appalachia’s landscapes and did great harm to communities.
He expressed doubts about whether the venture capital model fits with the culture and the long-term planning communities are now developing for a recovery after coal’s collapse.
“We’d love to have some thoughtful investment, some patient investment from people who understand what is really valuable here,” Davis said. “If you can find investors who appreciate who we are, then bring ‘em in.”
One early investment by Vance’s Rise of the Rest fund could speak to some of the concerns Davis expressed. The company AppHarvest aims to build large hydroponic greenhouses on abandoned mine land in eastern Kentucky. AppHarvest founder Jonathan Webb told ReSource partner station WMMT that this sort of agriculture could be part of a sustainable recovery.
“Now is the time to re-imagine, reinvest and rebuild here. Like, what are we gonna do now?” he asked. “Hopefully, high-tech ag will be a small piece of that larger picture.”
AppHarvest has lofty goals to put damaged land to new use. But it has hit a snag. Webb said the uneven settlement of the disturbed mine site could make some of it unsuitable for construction.
It’s another example of how hard it could be for new investment to gain a solid footing in Appalachia’s hills.