Why Your Startup Should Consider Going Rural

Matt Dunne, founder of The Center on Rural Innovation, believes that entrepreneurs and rural towns can be a perfect match.


In the past two years, Americans have flowed out of cities, living, working and learning remotely in the more rural parts of the country. Matt Dunne, founder and executive director of the Center on Rural Innovation, sees an opportunity in that. 

“There were some horrific impacts of the pandemic, but one of the upsides was a real opening of the aperture to where people could live and work and thrive,” says Dunne. 

Last month, Dunne spoke at a Magnuson Center event sponsored by DartUP. At the event, Dunne urged entrepreneurs to consider bringing their businesses to rural areas — not just for the social impact that the enterprises could have, but also for the benefits for the startup.

First-hand experience with rural innovation

Long before starting the Center on Rural Innovation, Dunne was familiar with bringing businesses to rural America. In the late 1990s he worked as the director of marketing at Logic Associates, Inc., a company founded by two Dartmouth graduates. The company was based in the Upper Valley and provided business management systems to commercial printers worldwide. 

Logic Associates had a great trajectory and an excellent exit, showing Dunne first-hand that businesses can be global players without being based in a big city. 

“The notion that you couldn’t create software tech in rural America seemed foreign to me, but it’s become part of the narrative,” Dunne says.

Changing the narrative

The Center on Rural Innovation pushes back on that perception. The organization launches initiatives to support entrepreneurship, workforce development and job creation in small towns. By doing that, the center aims to address the rural-urban economic divide. 

“We’re supporting communities that are interested in building tech-based economies,” Dunne says. 

Rural workers make up 13% of the nation’s workforce, but only hold 5% of computer and math jobs. In order to reach equilibrium and have a more equitable distribution, the rural economy should hold 13% of those jobs. That, in turn, would boost the local economy and provide economic mobility and resilience in the face of globalization and automation, both of which have taken a toll on rural areas. 

“Unfortunately there became this conventional wisdom that because you grew up or live in a rural place, you don’t have the capacity to find a new way to solve a market problem,” Dunne says. “But you can find that kind of inspiration and innovation anywhere. It doesn’t need to be at the same volume as Silicon Valley to make a difference in the economy.”

Nationally, there is an increased awareness that having a sharp economic divide between rural and urban areas can threaten the foundation of our society and our democracy. With that, there is more keen interest from policy-makers and funding partners to address the rural opportunity gap, Dunne says. 

A de-risked environment

While investing in rural economies can have a social impact, it also makes sense for businesses. 

“Entrepreneurs are alway looking for ways to do work in a de-risked environment,” he says. Rural spaces, with their lower cost of living and doing business, can offer that. 

Tech hubs like the Bay Area or Austin have a concentration of like-minded people, but there’s been “an over-obsession with the notion of agglomeration effects,” Dunne says. 

With work and cultivation, rural towns can offer similar skill sets. Challenges including access to high-speed internet and a qualified workforce, can be overcome through policies that intentionally support entrepreneurship.

“We can look beyond those general notions and see rural places as excellent locations to innovate and find partners with can-do attitudes to solve problems,” Dunne says.