Rural innovation faces constant funding opportunity gaps. Rural businesses represent 12% of all U.S. firms but receive less than 1% of venture capital (VC), with more than half of all VC flowing to just five major metro areas.
This isn’t just a venture capital problem. The pattern holds for federal dollars. Counties are more likely to receive federal funding when they have greater staff capacity and payroll spending. In other words, funding tends to flow toward regions that already have institutional infrastructure in place, leaving many rural communities structurally disadvantaged before innovation can even start.
But rural founders are no less capable or visionary. In fact, a recent study out of Michigan State University found that rural firms are just as likely to innovate as urban ones when accounting for size, sector, and other characteristics. The problem isn’t vision or capacity. The problem is support.
Rural Communities Are Underserved, Not Under-Ambitious
Accelerators can address this rural need for support. These structured programs can support entrepreneurs with mentorship, provide business guidance, and access to capital, and allow opportunities to test and refine products.
Accelerators are not general-purpose tools. They are strategic interventions whose impact depends on alignment with founders’ needs, industry demands, and local conditions.
Since the first formal accelerator launched in 2005, thousands have emerged across the globe. They have become a mainstay of the innovation economy.
But most accelerators are designed with dense, urban innovation ecosystems in mind. They rely on high concentrations of investors, mentors, corporate partners, and research institutions. That design assumption doesn’t match rural America.
Rural regions don’t have the same resource density, but they do have equally valuable assets. Strong local relationships, cross-sector collaboration, and deep contextual knowledge are all characteristics of rural innovation potential. Unfortunately, these rural strengths are rarely prioritized in traditional accelerator models.
Concentration Bias and Missed Potential
Researchers refer to this as concentration bias. Accelerators tend to perform best in places that already have strong entrepreneurial ecosystems and underperform in places without them. But rural accelerators aren’t destined to underperform. They just need to take a different approach.
Some studies suggest accelerators may have the greatest impact in regions with the fewest institutional supports. In other words, when designed with local needs in mind, accelerators can serve as catalytic infrastructure, closing gaps and activating local leadership.
That insight led AscendRural, a program that connects technology companies to rural communities to pilot, validate, and scale solutions, to explore ways to amplify startup support for rural communities. We asked ourselves a simple question: What if we stopped applying urban-focused models? What would an accelerator designed specifically for rural realities look like?
Designing for Place, Not Convenience
Over the past year, AscendRural has been working with rural communities in central Minnesota and beyond to answer that question. Through conversations with rural leaders, founders, and changemakers, one thing became clear: Communities don’t want a stripped-down version of urban accelerators. They want a totally different approach.
Rural communities want models that are grounded in trust, shaped by relationships, and focused on outcomes that matter locally, like health, education, economic resilience, and youth opportunity.
In short, they want systems and solutions that center the people and places they’re meant to serve.
The Rural Innovation Accelerator is a place-based accelerator model designed to do exactly that. It focuses on these guiding principles to help technology companies become rural-ready for pilot projects with partners in rural communities.
Want to see what rural-centered innovation looks like in action?Join us for a three-part webinar series that brings together state leaders, representations from Centers for Medicare & Medicaid Services, health plans, and innovators to explore how rural health transformation is being implemented on the ground.
AscendRural is an initiative that connects early-stage technology companies to rural communities to pilot, validate, and scale well-being solutions.”
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