Ann Arbor and Detroit — An Intro to the Startup Ecosystem
This week on Midwest Startups, we’re adding a city resources page for the combined metro areas of Ann Arbor and Detroit. We asked a few founders to highlight why they’ve planted their flag in the region and what makes Michigan an exciting place to grow their startups.
Want even more info? Check out these resources from EntryPoint:
Comprehensive Analysis on Ann Arbor Entrepreneurial Ecosystem
Comprehensive Analysis on Detroit Entrepreneurial Ecosystem
“We were able to learn from some of the best”
With nearby University of Michigan, early stage companies have a research giant within arm’s reach to help with startup R&D. Of perhaps even bigger impact, large colleges and universities often have other beneficial programs, like accelerators (Desai at University of Michigan, Red Cedar at Michigan State) that provide mentorship opportunities and, in some cases, funding for early stage companies.
Proximity to research institutions and their resources was a key factor to the early success of Dynamo Metrics, according to founder Nigel Griswold. “The underlying data system that fuels Dynamo Metrics’ cloud-based software — built specifically for state and local government and their partners — was conceived during my graduate research at Michigan State University,” says Nigel. “My co-founder Ben Calnin and I cut our teeth working together on public sector policy evaluation research at the MSU Land Policy Institute.”
In addition, simply having a density of research institutions is spinning up startups to create a strong network of experts in the area. Ripple Science CEO Peter Falzon has found the university-adjacent startups to be a particularly appealing part of growing his business in Michigan. “Since returning to Michigan, I have learned is that there is a wealth of high quantity of technologies produced by University of Michigan, Wayne State University, Michigan State University and others which makes southeast Michigan is an opportunity rich environment for entrepreneurs,” he says.
Industry partners in the area can also be a huge benefit to startups in Detroit and Ann Arbor. “As a healthcare AR company, we were very interested in connecting with a variety of hospitals as we went to market, and we were able to learn from some of the best, like University of Michigan Health System, a top research institution, and Children’s Hospital of Michigan, in Detroit, one of the top ranked pediatric hospitals in the country,” says Spellbound founder Christina York.
“…Great support for getting startups off the ground.”
The Detroit/Ann Arbor region’s government and region-driven resources for startups have created a strong backbone for startup funding. Early stage companies can often get an assist from the abundance of city and state agencies.
“We were able to secure angel, government backed, and venture funding in the area. We also secured our first $100K in non-dilutive grants to get us to our first customers,” says Christina.
Smartzones like Spark (Ann Arbor), TechTown Detroit as well as higher-ed institutions offering fund matching programs like First Customer Program (University of Michigan) and DC3 (Detroit Creative Corridor Center) can help companies get funding to get off the ground, where early stage investors can jump in to support product-market fit.
These resources paired with a strong network of early stage VC firms makes Detroit/Ann Arbor an attractive spot to grow a startup. Nigel chimes in about what it’s meant to start Dynamo Metrics there: “We have closed $50,000 in direct non-dilutive financial support from Ann Arbor SPARK (our local economic development authority), hundreds of thousands from early-stage state-endorsed venture financing, as well as seed stage venture capital firms — all delivered from the Ann Arbor VC network.”
Peter adds, “The early funding landscape here has improved significantly in no small part thanks to economic development minded funds like Renaissance Ventures, the Michigan Biomedical Fund, Michigan Investment in New Technologies (MINTS), Invest Michigan, Invest Detroit and Red Cedar Ventures, that provide great support for getting startups off the ground.”
An Abundance of Talent
The Detroit/Ann Arbor region knows no shortage of talent. It’s something all three entrepreneurs we interviewed pointed out in detail. Here’s just one example from Christina:
These schools have more than just “traditional” technology programs producing talent: these schools are graduating students with 3D art and design, animation, AI, game development, and AR/VR skills. But these institutions often have other beneficial programs, like the Entrepreneurship Leadership Program that matches pre-vetted, skilled students, with companies and even funding sources and the Michigan Athletics Career Center that matches hard-working student athletes with companies. And you can find these talented people at meetups (Game Dev Meetup in Ypsilanti or the AR/VR Meetup in Detroit) and local events like Tech Trek in Ann Arbor and Startup Week in Detroit.
Both Ann Arbor and Detroit can provide an exciting standard of living for, among other groups, young people interested in a tech career. Peter explains that both places are appealing for getting started in the industry. “It’s really the chance to experience the urban revival taking place in Detroit or live in a great college town. I think it’s great that this generation of graduates doesn’t have to go off the California to be part of an exciting startup.”
Nigel adds that the density of startups means the bar is high for finding talent: “We have accessed top-level talent due to a healthy churn of small- and medium-sized startups that offer the promise of shared glory when amazing ideas are brought to fruition and corporate exit.”
In Summary?
Detroit and Ann Arbor as a region have quote a lot going for them, but Nigel puts it simply:
“It’s a healthy space. Schools are good. Culture is good. Entrepreneurs can thrive. People are passionate and give a damn.”
Ready for more data about startups and funding in Midwest Cities? Check out our City Resources.
