The number of venture capital (VC) firms in Michigan has tripled over the last decade proving they are beginning to take notice of budding companies in our state.
Recent history tells us that Michigan was a place venture capital firms avoided because the deals were small and the potential return on investment was even smaller. Many great businesses were hatched here only to be moved to one of the coasts because the access to talent and investment dollars was so much better.
Fortunately, that history is behind Michigan. People like Chis Rizik, CEO of Renaissance Venture Capital Fund, think venture capital firms are starting to take notice. This was among the many changes speakers noted at the Xconomy Forum held recently at TechTown.
Risik points to the number of VC funds in Michigan tripling over the last decade as proof that there is value here. While fellow panelist Charles Rothstein, senior managing director and co-founder of Beringea, might be a bit more staid in his enthusiasm for the future of VC in Michigan, he noted startup companies in the state are becoming more successful. With that success the perception of Michigan within the industry will continue to change.
Randal Charlton, the executive director of TechTown noted in his opening remarks that only one in 100 companies in the US export internationally. Since Michigan has access to international shipping through the Great Lakes and a significant trade relationship with Canada it is well-positioned to help more companies enter untapped markets.
David Cole, chairman emeritus, Center for Automotive Research, talked about a change in corporate philosophy toward intellectual property. He pointed to organizations like his new company AutoHarvest as a way for automotive companies to share their research outside the auto industry to help spur on innovation. He sees that automotive intellectual property as an example of what Michigan has to offer.
“We have the local resources to attack global markets,” said Ann Marie Sastry, co-founder and CEO, Sakti3 and professor at University of Michigan. She points to the changing attitudes in Michigan universities toward professors and their ventures outside of the classroom as the type of thinking that helps incubate the types of businesses recent graduates want to work in.
Even entrepreneurs are starting to help each other stay in the state.
Dug Song, an experienced entrepreneur and CEO of Duo Security, talked about starting Tech Brewery in Ann Arbor as a way for newly hatched companies to learn from other companies that are growing, too.
“We’re starting to figure out how to keep the companies that are started here,” Song said. “We are learning things like companies can shop for capital just as capital shops for companies.”
The event ended as it began, the panelists mingling with the approximately 40 people in attendance, exchanging business ideas and thoughts for what Michigan will look like in 20 years. Which left me wondering … Will the state motto change to, “If you seek a pleasant business opportunity, look about you?”