I see many more reasons to be encouraged that Michigan is on the right path for fostering entrepreneurship and economic growth.
For instance, today we have a better funding environment with the 21st Century Jobs Fund. Launched in 2005 by the MEDC, Michigan’s 10-year $2 billion 21st Century Jobs Fund has created a fertile climate for entrepreneurship and begin the transformation and diversification of Michigan’s economy.
The initiative has also:
- Made direct investments in high growth technology companies;
- Made indirect investments in additional high growth companies through venture capital firms, banks,and economic development programs; and
- Built upon the existing business support infrastructure to help Michigan companies develop business plans, enter new markets, submit successful research proposals, raise capital, and conduct other critical activities involved in growing their businesses.
The 21st Century Jobs Fund plays an important role in building what just about any entrepreneur will tell you Michigan needs: a stronger financing environment with support available at different stages of a company’s
development.
The initiative addresses this by creating multiple programs, each with a different sweet spot:
The Michigan Emerging Technologies Fund (managed by the MI-SBTDC) provides commercialization funding to companies at their earliest stage when they receive federal R&D grants. Thirty companies have been funded with the first $2.4 million of this program, leveraging $17.7 million in additional capital and creating and retaining 230 jobs.
The Michigan PreSeed Capital Fund (managed by Ann Arbor SPARK in partnership with the Smart Zones) enables companies to achieve or accelerate early sales and/or meet milestones necessary to raise larger, institutional rounds of financing. Forty-three companies were funded with the first $9 million deployed by this program, leveraging more than $34 million and creating nearly 500 jobs.
The 21st Century Investment Fund (as well as a few other similar state initiatives) strengthens Michigan’s venture capital environment and has helped grow the state’s venture investment community to 16 venture capital firms with $1.1 billion under management. The 21st Century Investment Fund invested in 11 venture capital firms, who in turn invested $33.9 million in 13 companies, leveraging almost $260 million third party capital, creating more than 780 jobs.
Our greatest assetsIt's important, however, to remember that Michigan has always had unique and powerful assets, the most prominent of which are our research universities and natural resources
Chuck Newman, chairman of Ann Arbor-based ReCellular, one of the world’s largest recyclers of cell phones and accessories, is not alone when he credits Michigan’s strong research institutions with providing the state with a fresh supply of new talent for emerging companies and start-ups.
Michigan State University, Wayne State and U-M give Michigan a leg up on other states for top talent as it diversifies into such emerging technologies as alternative energy, battery development, advanced manufacturing of medical devices, and wind turbines.
Newman and others also point to the state’s natural resources and large supply of fresh water as one of its competitive assets.
Lean and greenProbably the most encouraging and promising developments in Michigan is the growing corporate commitment to sustainability and innovation.
One need not look any farther away than Downriver Detroit for a prime example of Michigan’s globalleadership in sustainability. Trenton Forging is a leading producer of custom impression die forgings for a wide variety of industries that include automotive, mining, defense and agriculture. The company has earned the distinction of being one of the first companies worldwide to be certified QS9000, and the first closed impression die forging company in the world certified QS9000/ISO9002.
Under the leadership of President David Moxlow, the company has turned its rooftop into a viable greenhouse…even growing poinsettias for the holidays.
"I have been interested in ‘vertical’ farming for a few years and even did some research into growing algae in a controlled environment for use as a biofuel," Moxlow says.
"In doing the research and trying to figure out what I could do with 26 million BTU's of wasted energy a day, I decided that we could take advantage of a flat roof on one of our manufacturing buildings and go up. This is as close as I could get to vertical farming and I wanted to create a model for industry and prove that we could grow vegetables in Michigan during the low-light months of October through January," he explains.
"We were successful with the help of energy efficient LED grow panels. Heating the greenhouse using waste heat (from the forging plant) is what makes the project affordable," Trenton Forging's top executive said.
We've come a long way, we have a long way to goMichigan has had a collective inferiority complex, developed over many years. Obviously, the state still faces daunting challenges like cutting $1.2 billion from a $9 billion budget. We still lead in too many negative economic metrics like unemployment and home foreclosures. And too many entrepreneurs still consider their situation dismal and feel they can’t get the support they need, especially financially.
But increasingly, one also hears Michigan entrepreneurs say how amazed they are by the vast amount of resources available in the state. Compare this situation to 10 years ago when there was virtually no investment community.
There is no doubt that Michigan’s economic development efforts are working. As we learned in the past decade, there’s no easy fix, no cure-all panacea for Michigan. We need to build on the past decade, set realistic, achievable expectations, measure what’s done and rebuild the superiority complex we once had.