When Steve Case, the billionaire co-founder of AOL, first met J. D. Vance, author of “Hillbilly Elegy,” the best-selling book about the industrial decline of the Midwest, Mr. Case told him, “I really love the book but there is a part of it I don’t love.”
Mr. Vance listened patiently.
“It helped frame the problem but it didn’t really offer up a solution,” Mr. Case told him.
“Well, it is interesting you say that,” Mr. Vance replied, “because that’s really what my next chapter is going to be.”
For the past several months, there has been a torrent of press around how Mr. Case and Mr. Vance have teamed to try to revive entrepreneurship in what elites often derisively refer to as the so-called flyover states. As my colleague Steve Lohr wrote recently, Mr. Case and Mr. Vance have been barnstorming various cities in a painted bus, holding entrepreneurship competitions as if they were politicians on the campaign trail.
But until now, at least to some skeptics, it seemed like a do-gooder vanity project.
How could these two men significantly change the dynamic among serious investors on the coasts to reorient their focus on cities, many of them suffering from the erosion of manufacturing, in the Rust Belt and elsewhere?
It turns out that while they were publicly crisscrossing America, they were also privately holding meetings with some of the wealthiest individuals and families in the country, urging them to not only invest in a new fund but become partners with some of the companies that will benefit from it.
On Tuesday, the fund, called Rise of the Rest, will disclose its investors, which has turned into a Who’s Who of American business. Among them: Jeff Bezos, the founder of Amazon and now the world’s richest person; Eric Schmidt, chairman of Google’s parent, Alphabet; Howard Schultz, chairman of Starbucks; Tory Burch, the fashion mogul; Ray Dalio, founder of the hedge fund Bridgewater Associates; Dan Gilbert, the founder of Quicken Loans who has remade Detroit; Henry Kravis, the co-founder of KKR; David Rubenstein, the co-founder of Carlyle Group; Michael Milken, the financier and philanthropist; John Doerr, the venture capitalist; Jim Breyer, one of the first investors in Facebook; as well as members of three wealthy families: the Waltons, the Kochs and the Pritzkers.
Also on the list are Sean Parker, a former president of Facebook; Sara Blakely, the founder of Spanx; Jeff Vinik, the Florida billionaire and sports franchise owner; Byron Trott, Warren Buffett’s favorite banker; and Adebayo Ogunlesi, the lead director of Goldman Sachs and a large infrastructure investor. All told, it may be the greatest concentration of American wealth and power in one investment fund.
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The idea — far grander than the money itself, which is only $150 million to start, pocket money for most of the investors — was to assemble a dream team and create a network effect for entrepreneurs in the middle of the country to align with the biggest names in business.
The fund, said Mr. Vance, was meant to construct an ecosystem like the one in Silicon Valley that will provide support and connections to entrepreneurs in small towns.
“People tend to follow their networks,” said Mr. Vance, who was recruited to the effort by Mr. Case. “While the network in Silicon Valley is obviously something that is great, it can also have an exclusionary effect that prevents investors from looking at and finding opportunities that exist outside of their networks and outside of their geographies.”
Mr. Case and Mr. Vance hope to seed investments in start-ups in underserved cities and then bring in some of their big names to invest even more money in them. “We’ll be curating interesting companies,” Mr. Case said.
In other words, if they discover a nascent but promising e-commerce company in Allentown, Pa., they will not only invest in it, but they might also help it establish a relationship with one of the fund’s investors — Mr. Bezos, for example — who might invest even more.
