The venture capital landscape, long dominated by coastal hubs, is experiencing a transformative shift, with firms like Cortado Ventures emerging as pivotal players in unlocking innovation across America’s heartland. In a recent spotlight from the National Venture Capital Association’s (NVCA) "Meet a VC" series, Mike Moradi, co-founder and general partner of the Oklahoma City-based firm, articulated Cortado’s distinctive thesis: to invest in seed-stage frontier technology companies across the U.S. Midcontinent, backing founders who are uniquely positioned to revolutionize critical industries from within. This approach not only seeks to generate compelling financial returns but also aims to broaden the very definition of American innovation, demonstrating that talent and groundbreaking ideas are distributed far more widely than capital has traditionally been.
Mike Moradi’s Entrepreneurial Odyssey: Lessons Forged in Fire
Mike Moradi’s journey to venture capital is a testament to the resilience and iterative learning process inherent in company building. Before co-founding Cortado Ventures in 2020, Moradi was a six-time founder himself, navigating the often-treacherous waters of entrepreneurship across diverse, technically complex sectors such as biopharmaceuticals and nanotechnology. His initial foray into the startup world began unconventionally, leaving dental school to pursue his first entrepreneurial vision. That venture, as Moradi candidly shares, ultimately failed. This early setback, however, did not diminish his ambition; instead, it served as a foundational lesson in perseverance. "The lesson was to keep pushing past every obstacle, to not be discouraged by hearing the word ‘no,’ and to stay the course," Moradi reflects, highlighting a conviction that would define his subsequent career.
This experience stands in stark contrast to the often-glamorized narrative of immediate startup success, echoing a broader truth in the entrepreneurial ecosystem: failure is frequently a prerequisite for profound learning. According to data from the Small Business Administration, approximately one-fifth of new businesses fail within their first year, a statistic that underscores the high-risk, high-reward nature of venture creation. Moradi’s ability to extract critical insights from this initial defeat became a cornerstone of his pragmatic approach to investment.
His subsequent ventures brought varied successes and further lessons. One company scaled rapidly and was acquired by a Fortune 100 corporation, validating his drive and vision. Another San Francisco Bay Area startup, despite securing an $18 million Series B financing round, teetered on the brink of collapse before its eventual acquisition. This near-failure delivered a different, equally vital lesson: while capital can accelerate growth, speed without direction can be detrimental. "A high valuation and a full bank account will happily let you scale the wrong thing," Moradi cautions. This insight into the double-edged sword of abundant capital – its power to propel or to misdirect – became central to Cortado’s investment philosophy, emphasizing disciplined capital deployment aligned with validated milestones rather than unbridled expansion. Moradi’s personal history as a founder, marked by both triumph and tribulation, thus forms the empathetic and strategic core of Cortado Ventures, positioning the firm as a true partner built by founders, for founders.
The Midcontinent Thesis: Unlocking Untapped Potential
Cortado Ventures’ core strategy is deeply rooted in the conviction that the American Midcontinent represents a vast, often overlooked reservoir of innovation. The firm’s investment thesis challenges the traditional geographic concentration of venture capital, asserting that proximity to "hard problems" in critical industries can yield highly differentiated companies and robust returns. The Midcontinent is home to foundational sectors undergoing immense pressure to evolve and innovate, including energy, aerospace and defense, healthcare, manufacturing, mobility, and logistics. These industries operate within complex physical environments, established supply chains, and demanding customer relationships, requiring solutions that go beyond mere software applications to a deep, nuanced understanding of operational realities.
Cortado actively seeks out experienced technical founders who possess this intimate industry knowledge. These are often individuals who have spent years immersed in hospitals, factories, laboratories, energy companies, aerospace programs, or logistics networks, identifying persistent problems and conceiving novel solutions from an insider’s perspective. Their lived experience provides unparalleled credibility with customers, practical insights into implementation challenges, and a knowledge base that would be exceedingly difficult to cultivate from an external viewpoint. This "founder-as-industry-expert" model mitigates many of the risks associated with early-stage frontier technology, where market adoption hinges on solving real-world, complex problems.
The geography itself serves as a significant competitive advantage. The Midcontinent offers unique benefits: direct proximity to key industries and potential customers, a readily available technically skilled workforce often cultivated through regional universities and vocational programs, strong research institutions, and complementary public funding initiatives. Furthermore, the region boasts significantly lower company-building costs compared to traditional tech hubs. For instance, office space, talent acquisition, and general operational expenses in cities like Oklahoma City or Tulsa are often a fraction of those in Silicon Valley, Boston, or New York. This cost efficiency allows startups to extend their runway, iterate more effectively, and achieve meaningful milestones with less capital, thus increasing their chances of long-term success. Data from the Kauffman Foundation and other economic reports consistently highlight the rising entrepreneurial activity in secondary markets, driven by these very factors. While traditional venture capital flows have historically favored coastal regions, with over 70% of U.S. venture dollars going to California, New York, and Massachusetts, there’s a growing recognition of the untapped potential in regions like the Midcontinent. According to PitchBook-NVCA Venture Monitor reports, while the overall share remains small, the growth rate of venture investment in non-traditional hubs has shown promising upward trends in recent years.
Cortado’s portfolio vividly illustrates the breadth of innovation emerging from this environment, with investments spanning space communications, industrial safety, critical infrastructure cybersecurity, advanced manufacturing, healthcare, energy, and mobility. Moradi emphasizes that this strategy is not built on a premise of preferential treatment for Midcontinent founders; rather, it’s a robust economic conviction. "Talent is not concentrated anywhere in particular. Capital and networks have just been slower to distribute than talent has," Moradi asserts, encapsulating the firm’s belief that by actively seeking out and nurturing these geographically dispersed centers of excellence, Cortado is uncovering sources of insight and innovation that traditional networks have historically overlooked, ultimately contributing to a more diversified and resilient American innovation economy.
Beyond Capital: Architecting a Thriving Innovation Ecosystem
When Cortado Ventures launched, Mike Moradi initially believed that the primary impediment to a burgeoning venture ecosystem in the Midcontinent was a simple scarcity of capital. The firm’s early successes in identifying and funding promising regional companies validated the demand for local investment. However, as Cortado matured and its understanding of the entrepreneurial journey deepened, Moradi’s perspective on what founders truly require expanded significantly. "Five years ago, I would have said the limiting reagent in a young ecosystem was capital. Capital turned out to be necessary, and also nowhere close to sufficient," he states, highlighting a crucial evolution in his philosophy.
This realization underscored that a vibrant innovation ecosystem demands far more than just financial injections. Founders need experienced operators who can provide hands-on guidance and help them circumvent common, preventable mistakes. They need customers willing to pilot and adopt unproven technologies, acting as crucial early adopters and validation points. Moreover, they require a network of investors prepared to offer sustained support between funding milestones, demonstrating long-term commitment. Crucially, a thriving ecosystem necessitates a robust community where vital relationships can naturally form – connections with mentors, advisors, potential employees, and collaborators. "Money can accelerate a company," Moradi notes, "It cannot stand in for experience."
This expansive view of founder support has profoundly shaped Cortado’s role within the broader Midcontinent ecosystem. Rather than hoarding valuable relationships exclusively for its portfolio companies, the firm actively works to weave a dense network connecting founders, funders, universities, corporations, policymakers, and technical experts. This collaborative ethos is exemplified by Cortado’s annual Midcontinent Venture Capital Summit, an event that convenes investors, limited partners, founders, and ecosystem leaders from across the country, fostering connections and facilitating knowledge exchange that transcend regional boundaries. Additionally, Cortado actively partners with regional entrepreneurship organizations and The Verge, an Oklahoma City-based incubator and accelerator that provides critical company-building resources, programming, and capital connections.
Each of these interactions, whether at a summit, a networking event, or through an accelerator program, serves as a potential catalyst for a founder – leading to a crucial customer introduction, an invaluable advisor, a key employee, a strategic collaborator, or a follow-on investor. Collectively, these relationships construct the essential infrastructure that enables more companies to successfully launch, grow, and scale within the region. For Moradi, this systemic approach is where venture capital’s impact truly extends beyond the confines of a single investment. A stronger, more interconnected ecosystem not only offers more entrepreneurs a viable pathway to company formation but also creates more opportunities for capital, talent, and groundbreaking innovation to find one another, fostering a self-sustaining cycle of growth and prosperity. This aligns with broader national efforts by organizations like the Economic Development Administration (EDA) and local chambers of commerce, who recognize that fostering robust startup ecosystems is key to regional economic resilience and job creation.
The Philosophy of Prudent Investment: Conviction Without False Certainty
Investing in early-stage companies is inherently fraught with uncertainty, a reality Mike Moradi readily embraces. "Incomplete data is my job description," he quips, acknowledging that venture capitalists often make high-stakes decisions with imperfect information. Rather than attempting to eliminate this inherent ambiguity, Cortado Ventures operates with a disciplined framework designed to manage risk and validate assumptions systematically. Moradi’s approach involves meticulously separating assumptions that can be tested immediately from those that will only resolve over time. This involves identifying the critical conditions that must be true for a venture to succeed, rigorously considering how those conditions could be proven false, and carefully evaluating the cost of achieving the next meaningful milestone.
Cortado’s strongest conviction typically centers on three core pillars: the strength and resilience of the founding team, the clarity and urgency of the customer problem the company aims to solve, and the demonstrable rate of progress in addressing that problem. While bullish on these fundamentals, Moradi maintains a healthy skepticism regarding predictions about the precise timing of emerging markets or the specific path a company might ultimately take to an exit. This disciplined approach becomes particularly vital when a financing round is moving quickly, as competitive processes and compelling founder narratives can generate intense pressure to make swift decisions before core investment assumptions have been thoroughly vetted. "A hard deadline is exactly when people stop asking uncomfortable questions," Moradi warns, highlighting a common pitfall in the fast-paced world of venture funding.
To counteract this, Cortado is prepared to slow down the diligence process when necessary, often bringing in independent scientific or technical experts to conduct a deeper evaluation. This additional scrutiny either strengthens the firm’s conviction, providing a more robust foundation for investment, or reveals potential red flags that warrant stepping away. Moradi notes that Cortado’s most enduring founder relationships often begin with this rigorous examination, as it sharpens strategic thinking and identifies risks proactively, allowing them to be addressed while there is still time. Importantly, slowing down the decision-making process does not equate to a delayed response; rather, it ensures a more informed and strategic commitment.
This same discipline extends to valuation. Moradi firmly believes that "a sensible entry price is a form of protection for the founder, employees, and investors alike." While an aggressive valuation might feel like an immediate victory, it can create unrealistic expectations. If a company’s subsequent progress fails to meet the lofty projections tied to that valuation, the consequences can be severe, impacting founder ownership, employee equity, future fundraising options, and the company’s crucial ability to adapt to market shifts. This dynamic underscores a delicate balance: while venture capitalists must offer attractive terms, overly aggressive valuations can effectively "strangle the life out of a company" by setting an impossibly high bar for future growth. "The right number buys you options for years. In boom times, people forget that financial crises happen," Moradi reminds, stressing the importance of long-term financial prudence. For Cortado Ventures, this discipline is not a reflection of a lack of belief in a founder’s ambition but rather a strategic tool to provide an ambitious company with the flexibility, runway, and time it needs to truly succeed amidst inevitable market fluctuations and unforeseen challenges.
Active Partnership: Speed, Specificity, and Strategic Non-Intervention
Cortado Ventures’ commitment to its portfolio companies extends far beyond the initial capital injection, embodying a philosophy of active, founder-centric partnership. The firm’s team, composed of individuals who have themselves built, scaled, and successfully exited companies across many of the industries in which Cortado invests, brings invaluable operating experience to the table. This shared history profoundly shapes how the firm supports founders, particularly when strategic plans pivot or difficult decisions become unavoidable. Mike Moradi distills this meaningful support into two core principles: "Speed and specificity."
"Answer in hours rather than days and show up with work already done instead of advice. Better yet, pick up the phone," Moradi advises, illustrating a bias towards immediate, actionable engagement. This proactive approach can manifest in diverse ways: rebuilding a complex financial model overnight, facilitating a critical customer introduction, actively recruiting a senior executive, or taking responsibility for navigating a challenging board conversation. It also entails the crucial, albeit often uncomfortable, task of speaking difficult truths when a company’s runway is shortening or its core strategy requires a drastic re-evaluation. Moradi’s personal experience as a founder deeply informs this aspect of support. He recalls being in those meetings, emphasizing, "What helped was someone who lowered the temperature, told the truth to me and the board, and followed up after the meeting." This empathetic yet direct approach fosters trust and enables founders to confront challenges head-on.
As Cortado and the broader Midcontinent ecosystem have matured, the sophistication of its founder support has evolved. Portfolio companies now have access to a comprehensive network that includes operating executives, industry specialists, expert advisors, prospective customers, seasoned coaches, fellow investors, and a community of other founders. This multi-layered support system addresses the diverse needs of growing startups. While in the early days, Cortado’s investment and its ability to attract additional investors were paramount, today’s founders increasingly seek customer access, senior talent acquisition support, specialized technical expertise, and candid, honest guidance.
Crucially, Cortado’s role is never to usurp control from the entrepreneur. The firm understands that true leadership resides with the founders, and sometimes, the most valuable contribution an investor can make is recognizing when to step back. "Other times," Moradi notes, "being helpful means staying out of the way." This nuanced understanding of intervention – knowing precisely when to engage deeply and when to allow founders the space to lead – is a hallmark of Cortado’s strategic partnership model, reflecting a profound respect for the entrepreneurial spirit and the autonomy required for innovation to flourish.
Broader Impact and The Future of American Innovation
Mike Moradi firmly believes that a venture firm’s responsibility extends beyond the confines of its own portfolio and the limited partnership agreements of its funds. "We must build things that outlast a single fund," he asserts, underscoring a long-term vision for systemic impact. For Cortado Ventures, this philosophy translates into a concerted effort to strengthen the connective tissue among founders, funders, universities, corporations, and policymakers across the Midcontinent. It also means actively fostering the formation and growth of other investment firms within the region, rather than viewing them as competitors. "This is not a zero-sum game," Moradi declares. "We want to enable a dozen other firms in our geography, and bring in outside funds for later rounds. We need to create scalable structures where everyone can win."
This expansive, collaborative approach to ecosystem building is critical. A larger, more interconnected investment community provides founders with a broader array of potential capital sources and expertise, increasing their chances of success. It simultaneously creates more opportunities for investors to collaborate, co-invest, and participate in promising companies, diversifying risk and amplifying impact. Over time, this collective effort establishes a more durable pathway between regional innovation and national capital markets, ensuring that groundbreaking ideas in the Midcontinent can attract the necessary follow-on funding to scale globally. This aligns with national policy goals to foster regional economic resilience and reduce the concentration of innovation in just a few geographic hubs.
While deeply committed to ecosystem development, Moradi is equally emphatic about the foundational responsibility of a venture firm: fiduciary duty. His experience serving as a trustee and audit committee member for a state retirement system instilled in him the paramount importance of being transparent and direct about investment risk, duration, and potential losses. "Ecosystem building matters, and it does not excuse any of us from being disciplined fiduciaries first," he states, highlighting the critical balance between mission-driven development and rigorous financial stewardship.
Moradi also recognizes the pivotal role of the NVCA as an essential part of the connective infrastructure supporting venture firms and founders nationwide. Policy issues such as capital formation, research commercialization, immigration, government procurement, tax treatment, and securities rules are not abstract concepts; they directly influence an emerging manager’s ability to raise a fund, a startup’s capacity to attract talent, and a new technology’s path to reaching the customers and institutions that desperately need it. "NVCA helps each of us make policy concrete and stay on top of the issues that matter in D.C. and beyond," Moradi confirms. Furthermore, Cortado’s active participation in the NVCA provides a vital platform to inject a Midcontinent perspective into national conversations about innovation, capital formation, and the future trajectory of the venture industry, ensuring that diverse regional voices are heard at the highest levels.
Expanding the Map of American Innovation: A Vision for Collective Success
Mike Moradi hopes that the story of Cortado Ventures can help reshape perceptions of the American venture capital landscape, revealing its true breadth and diversity. While the industry’s largest, most visible firms often capture the most media attention, a significant and increasingly vital portion of venture capital comprises smaller, specialized investors. These firms write early checks into niche markets, specific industries, underserved geographies, or particular demographic segments. Moradi aptly notes, "Most of VC looks nothing like the caricature. The bulk of the industry is small firms writing early checks into some niche, be it industrial, geographic, demographic, or otherwise. And a VC firm is also a startup until fund 3 or 4."
These specialized firms play an indispensable role in the innovation ecosystem. They are adept at identifying founders before their markets become obvious, connecting highly specialized knowledge with crucial capital, and guiding companies through the challenging, often ambiguous period between a promising idea and a sustainable business. "The hardest work happens after the money moves," Moradi emphasizes, highlighting the intensive operational support and strategic guidance that these early-stage investors provide.
The confluence of new technologies — artificial intelligence, automation, advanced manufacturing, energy innovation, biotechnology, and space technology — is dramatically reducing the cost of pursuing ambitious ideas. This technological democratization empowers small, agile teams to tackle opportunities that once demanded the vast resources of large corporations or national programs. Critically, many of these innovative teams are emerging in locations intimately connected to the complex problems they are working to solve.
This decentralization of innovation is precisely where the broader impact of expanding venture capital across America truly lies. When investors intentionally look beyond familiar networks and actively seek out founders where critical industries operate, they facilitate the transformation of more ideas into viable companies, enable more groundbreaking technologies to reach the market, and empower more communities to participate robustly in the nation’s innovation economy. For Mike Moradi, the unwavering optimism for the future is rooted in these founders—the entrepreneurs who dare to attempt what others deem impossible. "Never forget that we’re here for them. When we do this right, everyone, including humanity, wins," he concludes, articulating a powerful vision for a future where venture capital serves as a catalyst for collective progress. Cortado Ventures, with its distinctive approach and deep regional commitment, stands as a shining example of this transformative potential, demonstrating how strategic investment can cultivate not just companies, but entire ecosystems of innovation.
