In a guest commentary for The Bridge, Chris Rizik – CEO of Renaissance Venture Capital Fund in Ann Arbor – describes the entrepreneurial and venture funding landscape in Michigan, giving an optimistic outlook. He writes: “Of course, Michigan hasn’t completely turned the corner; it will take years to establish sustained, diversified growth. But it is important to take stock of where we are in the process, and a look at the last five years shows Michigan has come a long way. Young people are flocking to downtown Detroit, Grand Rapids and Ann Arbor. Entrepreneurship is no longer a rarity but something for which hundreds of thousands of us are striving.” [Source]
Crain’s Detroit Business reports on the expansion of Ann Arbor-based Pot & Box, which is opening a “pop-up” version in the D:hive space on Woodward Avenue in Detroit. According to the report, owner Lisa Waud “is the first entrepreneur signed to Pilot, a new program offered by D:hive that will give a rotating cadre of small businesses two months of free rent as well as marketing and design support.” Waud plans to open a permanent location in Detroit later this year. [Source]
Local Development Finance Authority board meeting (June 12, 2012): At its Tuesday morning meeting, the board of the LDFA took action on a number of significant items, including an approval of annual revisions to the LDFA’s contract with Ann Arbor SPARK to operate a business accelerator/incubator. SPARK is this region’s economic development agency.
Besides the usual housekeeping changes (like changing the year from 2012 to 2013), substantive revisions to the SPARK contract include the following: (1) eliminating support for angel investment groups; (2) adding licensed software to be provided by SPARK to incubator clients; and (3) adding a new talent-retention internship program.
Another significant deletion from the SPARK contract is $5,000 annually for maintenance of a web-based educational module for entrepreneurs, called Cantillon. According to an LDFA resolution from early this year, the LDFA had invested around $170,000 over the course of five years in the self-paced program, which integrates feedback from a mentor. The tool had been used by SPARK for its Entrepreneur Boot Camps and in other venues. However, a formal request for proposals to commercialize it – to license and market the software to a broader audience – did not result in a deal.
The initial RFP was issued last year, in August 2011, and elicited no responses. On re-issuance of the RFP, Kurt Riegger’s Business Engines was the only respondent. Riegger had been the developer of Cantillon. After negotiation, Riegger and the LDFA were not able to reach mutually agreeable terms. With the failure to reach an agreement, and the elimination of the item from the LDFA’s contract with SPARK, the Cantillon education module was characterized by city CFO Tom Crawford after the meeting as “on the shelf.” Cantillon will not be offered as a part of SPARK’s September 2012 Boot Camp.
In other business, the LDFA board approved SPARK’s marketing plan. A video that was presented to the board as part of that plan got a positive reaction from LDFA board member Stephen Rapundalo. He appreciated the fact that it focused on support for entrepreneurs, as opposed to enhancing SPARK’s efforts “across the board.” SPARK has a broader mission and other funding sources than just what’s expressed in its contract with the LDFA – but the contract is focused on supporting entrepreneurs in the development of new businesses. So Rapundalo wondered if it were possible for SPARK to put all of its LDFA-funded marketing budget towards that same entrepreneurial focus.
Skip Simms, SPARK’s vice president for entrepreneurial business development, told LDFA board members at their June 12 meeting that it’s possible he might be bringing them a proposal for a significant additional financial request. That request, Simms said, would be for an additional incubator that would provide Class A “wet lab” space. He said the amount he’d request would be consistent with the LDFA’s 15% fund balance reserve policy, and would only target the portion of the fund balance that exceeds the 15% level. For the recently approved FY 2013 LDFA budget, that works out to a maximum of around $157,000. Simms sits on the LDFA board as a non-voting ex officio member.
Reaction by LDFA board members to the wet lab incubator idea that Simms floated was extremely guarded. But they appeared to be open to being convinced – if they were to hear a clear business plan and case for the need for additional local wet lab resources for start-up companies.
It’s worth noting that the LDFA’s contract with SPARK is separate from the support that SPARK receives from the city of Ann Arbor, which has amounted to $75,000 annually for the last few years. The city’s $75,000 contract with SPARK for business support services is on next Monday’s June 18 city council agenda.
The full LDFA report begins with some brief background on the LDFA itself.
Washtenaw County board of commissioners meeting (Nov. 2, 2011): At a meeting that lasted nearly five hours, commissioners gave initial approval to the county’s 2012-2013 general fund budget, following a discussion dominated by the topic of funding for state-mandated animal control.
With supporters of the Humane Society of Huron Valley (HSHV) demonstrating outside the county administration building and speaking during public commentary at the meeting, commissioners debated at length over how to handle its contract with the non-profit. The proposed budget calls for cutting HSHV’s contract from $500,000 this year to $250,000 in 2012 and 2013.
HSHV’s current two-year contract expires at the end of 2011, and leaders of the humane society have expressed reluctance to sign a new one with such a significant cut, saying that even at the current rate the county is not paying what the services are worth. [.pdf of HSHV analysis of legal and financial costs for mandated services]
For their part, some commissioners contended that they don’t yet know the actual cost of providing mandated services, and that HSHV hasn’t provided them with the kind of financial data they need to make an informed decision.
In the budget that received initial approval, the line item that originally earmarked $250,000 in annual payments to HSHV in 2012 and 2013 was renamed to “Mandated Animal Control,” a generic reference that reflects the possibility that the county might contract with another agency for animal control services – an option they discussed explicitly.
Board chair Conan Smith also proposed an amendment to move that line item out of the county’s funding for outside agencies, where it has traditionally been listed, and add it to the budget for the sheriff’s office. The funding could then be combined with a line item of $180,000 that is already part of the sheriff’s budget – for animal control officers. The county recently has discussed the possibility of paying HSHV $250,000 plus $180,000 – a total of $430,000 – if the humane society also takes responsibility for the work now done by the animal control officers. The shift in fund categories was approved on a 8-3 vote, with dissent from Rob Turner, Rolland Sizemore Jr., and Ronnie Peterson.
After the vote, sheriff Jerry Clayton spoke to the board during public commentary, saying he hadn’t been notified that this shift in funding to his office might occur. He expressed a range of concerns about the decision.
After making two other amendments not related to animal control, the board ultimately gave initial approval to the budget on a 9-1 vote, with dissent from Sizemore, who said he still has questions about it. Felicia Brabec abstained. Appointed two weeks ago to fill Kristin Judge’s vacated seat in District 7 (Pittsfield Township), Brabec indicated she’d like more time to review the budget document. Additional amendments are expected before the board takes a final vote on the budget, likely at its Nov. 16 meeting.
The board also got a third-quarter 2011 update from the county’s finance staff, projecting a nearly $1 million shortfall for the year, which will be covered by use of the county’s fund balance.
In other business, the county voted to create a planning task force for a new pilot program in agribusiness. Called ”Seeds for Change: Growing Prosperity in Ypsilanti,” the project is intended to provide job training and placement to unemployed workers interested in agricultural employment, and to offer shared commercial kitchen space and business support to local agribusiness entrepreneurs. No funding has yet been identified for the effort.
A task force has been formed to guide a pilot training program for agribusiness jobs in Ypsilanti, including support for entrepreneurs in food-related businesses. The Washtenaw County board of commissioners voted to create the task force at its Nov. 2, 2011 meeting, but none of the 17 members to the entity have been identified.
Called ”Seeds for Change: Growing Prosperity in Ypsilanti,” the project is intended to provide job training and placement to unemployed workers interested in agricultural employment, and to offer shared commercial kitchen space and business support to local agri-business entrepreneurs, according to a staff memo. The initiative will also encourage local entities – including governments, universities, hospitals, and other partners – to buy products made from people in this program. Products …
A new University of Michigan joint master’s degree in entrepreneurship – a partnership of the college of engineering and Ross business school – was approved by the UM board of regents at their July 21, 2011 meeting. The degree program has been in development for more than two years. According to a staff report on the proposal, the “primary objective of this program is to arm students with the critical multidisciplinary knowledge necessary to create new technology-focused ventures, either as stand-alone entities or within established innovative organizations. Students will learn to create and capture value from novel technologies within the context of entrepreneurship.” [.pdf of full report]
The program was developed in partnership with UM’s office of technology transfer.
This brief was filed from the regents meeting in the boardroom of the Fleming administration building on UM’s Ann Arbor campus. A more detailed report will follow: [link]
University of Michigan Board of Regents meeting (Dec. 17, 2009): The December meeting of the UM Board of Regents was packed with presentations – on entrepreneurship, a new enrollment policy for Ph.D. students, and environmental sustainability efforts on campus.
Regents also approved the naming of the Von Voigtlander Women’s Hospital, reflecting a $15 million gift to the institution – part of the massive $754 million C.S. Mott Children’s Hospital and Women’s Hospital complex being built and expected to open in 2012.
The board signed off on several facilities projects, including interior work on offices at the former Pfizer site, now called the North Campus Research Complex (NCRC), as well as the next step in renovations of the Couzens Hall dormitory.
Also approved was a letter making UM’s annual operating request to the state, which laid out why legislators should appropriate funds to support the university in fiscal 2011. The letter, under the signature of UM president Mary Sue Coleman, did not request a specific dollar amount.
Coleman kicked off the meeting, as she typically does, with some opening remarks that led to news about plans to hold the April 2010 regents meeting in an unusual location: Grand Rapids.
Sergio Mendez was meandering through the art fairs crowd in downtown Ann Arbor. Walking down Washington toward Main Street, Mendez saw something worth picking up. It was the left arm – just the left arm – belonging to a guy he knows, Eric Garcia. So Mendez grabbed it and put it in his backpack.
That left arm wasn’t some sculpture in the art fair. But no worries, it also wasn’t Garcia’s literal left arm. It was a virtual arm, part of a multi-player iPhone game that Mendez and Garcia are developing, along with their colleagues at Phonagle, Jeremy Canfield and Ben Malley.
Phonagle LLC is a tech start-up. This week they’re using the art fairs as the setting to test out the game they’re developing. The object of this game: Find and collect virtual objects set up around the city – this version included their own virtual body parts.
Behind a graffiti-covered door, at the end of the alley next to the Michigan Theater and one floor below street level, a handful of entrepreneurs are working at all hours in some pretty unusual office space.
Under the umbrella of TechArb, a coworking space for University of Michigan students, 10 start-up technology companies have set up shop in 30,000 square feet of commercial basement space that has been vacant for years. With 18-foot ceilings, imposing columns and no natural light, there is feeling of total isolation from the hubbub of Liberty Street, just one story up. The seclusion allows the 30 entrepreneurs to focus intensely on building their businesses.
They’re hard at work because the clock is ticking. They’ve got the rent-free space for this summer, and this summer only.
Here’s what Phil Power believes: “There is nothing in life that is more challenging or more of an art form than being an entrepreneur.”
The former UM regent and newspaper publisher was talking to a group of University of Michigan students on Friday afternoon, giving them some insights on his own experiences founding Hometown Communications Network as well as his newest venture in social entrepreneurism, the Ann Arbor-based Center for Michigan. His talk was part of a series hosted by MPowered, a student entrepreneur group.
Power said he’d read Friday’s Detroit News article reporting that more than half of UM’s graduates leave the state after graduation. People have told him there’s nothing here for them in Michigan, he said, “which I think is a load of bull.”
HealthMedia, says Ted Dacko, is “a company that shouldn’t be here.”
Just a few years ago, the Ann Arbor firm was left for dead. They had 85 employees, a burn rate of $685,000 a month, and very little revenue. Venture capital funding had dried up. Dacko was working there as vice president of sales and marketing when the previous CEO quit – two weeks before the firm would literally run out of money.
The board asked Dacko if he wanted the job. If he took it, he had two choices: Make a go of it, or lock the doors.
If you know the rest of the story, you know why Dacko was honored Thursday night with the New Enterprise Forum‘s Entrepreneur of the Year award.
The Masonic Temple on West Liberty seems an unlikely place to find a food entrepreneur, but when The Chronicle arrived there one Tuesday morning earlier this month, Mary Wessel Walker was already aproned and baking at the commercial kitchen there.
“I’m experimenting a lot with recipes I haven’t tried in large quantities,” she says, opening a jar of honey that had crystallized from the cold. Those large quantities are for her customers – eight families who’ve signed up to buy a weekly amount of baked goods from CFK Bakery, Wessel Walker’s newest venture.
Ann Arbor is considered a regional hub for food system entrepreneurship. Along with an incredible diversity of grocery and restaurant businesses, Ann Arbor attracts a large collection of emerging ventures. As an agricultural innovation counselor with the Michigan State University Product Center, I help entrepreneurs get their products to market, and I’d like to highlight some of these ventures to provide insights into both entrepreneurship and the potential of developing our local food system.
It’s hard to know how many of the 200 or so students who attended Friday’s Entrepreneurship Hour lecture will become entrepreneurs. Maybe not the ones playing video games on their laptops or texting on their cellphones – but you never know.
Those who were listening to Christopher Ilitch and Doug Rothwell gleaned a fair bit of advice on what it takes to succeed, and on what some community leaders are doing to support entrepreneurs in southeast Michigan.