Despite COVID-19, optimism reigns in the Midwest’s startup scene

Hello and welcome back to our regular morning look at private companies, public markets and the gray space in between.

Startups in the Midwest are optimistic despite the fact that a fair number of companies in the region are suffering from economic impacts stemming from COVID-19, recently collected data shows.

The global pandemic has shaken the U.S. economy, but it hasn’t affected each area in the same way. States have seen differing levels of infection, paces of response, qualities of medical infrastructure and so on. What happens to Silicon Valley startups in the COVID-19 era, therefore, might not be exactly the same as what happens to Boston’s or Utah’s startup ecosystems (more on Boston here, Utah here).

A report out this month from Sandalphon Capital that digs into the reality, reaction and sentiment of the Midwest’s startup scene paints an interesting picture. While data collected from 197 startup CEOs from the region includes worrisome responses regarding fundraising and cash runways, it also reflects more optimism and green shoots than we anticipated.

This morning, let’s study a few key data points from the Chicago-based, early stage venture capital firm’s survey to better understand one of America’s most interesting, if least-covered, startup scenes.

Chin up

The full survey — you can find Sandalphon’s summation and the link here — contains a wealth of data, but today we’re focusing on three things:

  • COVID-19’s direct impacts
  • runway and fundraising situations
  • CEO optimism