October 18-20 | Tucson, AZ

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Michigan Economic Development Corporation to provide more money for entrepreneurship, innovation 

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October 18-20, 2023 / Tucson, AZ
The annual summit for research institution gap fund and accelerator programs, including proof of concept programs, startup accelerators, and university venture funds

The Story

The Small Business Development Center, Invest Detroit, Automation Alley and TechTownare some of the beneficiaries of a budget increase for support of entrepreneurship and innovation by the Michigan Economic Development Corp. for the fiscal year that begins Oct. 1.

According to Emily Guerrant, MEDC vice president of marketing, the budget for entrepreneurship and innovation has been increased from $19 million in the current fiscal year to $21.4 million, while the overall budget for the MEDC was cut by $1.5 million by legislators to $251.9 million.

“So it’s fair to say that entrepreneurial services and programs were a higher priority in the fiscal year 2017 budget than previously,” she said.

According to Fredrick Molnar, MEDC vice president of entrepreneurship and innovation, the Small Business Development Center is the largest beneficiary, getting a total of $4.8 million for several of its programs, including $2.1 million for its Emerging Technologies Fund and $1.2 million for its Business Accelerator Fund.

The SBDC is based at Grand Valley State University in Grand Rapids, with 11 regional offices and more than 20 satellite offices. It provides counseling, training and research for startups, existing small businesses and advanced technology companies.

Two of Invest Detroit’s programs will benefit — its Hacker Fellowship Program will get $300,000 over two years, and $100,000 in sponsorship money has been earmarked for November’s seventh annual Accelerate Michigan Innovation competition at Cobo Center.

“The Hacker Fellowship Program has done a great job at talent retention,” said Molnar. “We’re trying to keep our young talent here. They come out of college and all they think about is the East Coast or the West Coast. We’re saying, you don’t have to leave here.”

According to Martin Dober, vice president and managing director of Invest Detroit Ventures, the investment arm of Invest Detroit, a nonprofit economic development organization, the program puts graduating computer science graduates into one-year fellowships at Michigan startup companies.

“College students aren’t aware of startup opportunities in the state and often leave because of that, and startups don’t have the time to recruit for junior development talent on campuses,” he said. “We annually recruit a class of 15 computer science graduating seniors. … In two years of running the program, all 30 fellows have received jobs at Michigan startups. Last year, we asked our 15 fellows how many of them would have been working outside of Michigan had it not been for the Hacker Fellows program. Thirteen of the 15 fellows raised their hands.”

Dober said Invest Detroit will recruit the 2017 class of fellows this fall and match them with companies in the spring.

The program has also received financial support from the Community Foundation for Southeast Michigan and the Ford Motor Fund.

Rumors were circulating at last year’s Accelerate Michigan event that it might be the last. The MEDC, which had allocated a total of $1.35 million for the event in 2014 and 2015, had its budget cut by 27 percent for fiscal 2016 by state legislators and laid off 65 employees.

Dober said that despite the reduction in MEDC funding, this fall’s event is on solid financial footing. Invest Detroit replaced Ann Arbor Spark as the event’s fiduciary in 2013 and has taken over management of the event.

He said there is $200,000 remaining from MEDC’s previous commitment that wasn’t spent; that the New Economy Initiative for Southeast Michigan has chipped in $350,000; that he has been able to raise more in corporate sponsorships; and that he has a commitment of $250,000 by Spark to be one of the investors in the grand prize of $500,000 for the winning pitch, and a commitment of $150,000 from Detroit-based Invest Michigan.

He said the prize money this year will likely surpass the total of $845,000 last year and could hit $1 million.

Other recipients of support from Molnar’s budget include:

  • $2 million for a new fund, the First Capital Fund. While the money is allocated in Molnar’s budget, he said the Michigan Strategic Fund board has to approve the new fund at its September meeting, with would-be managers applying to run it in October. It would fund very-early-stage companies with investments of between $50,000 and $100,000.
  • $1.4 million for the Michigan Corporate Relations Network, which helps the private sector find and use university researchers.
  • $1.3 million for SmartZone grants.
  • $1.2 million for the Technology Transfer Talent Network, a program run by the University of Michigan that provides experienced business mentors to startups.
  • $1 million Michigan Translational Research and Commercialization (MTRAC) grant to support the advanced transportation project at UM.
  • $1 million for a new Proof-of-Concept Fund. This will provide awards of between $5,000 and $30,000 to help determine if a promising idea has commercial possibilities.
  • $525,000 MTRAC grant for the advanced materials program at Michigan Tech University.
  • $500,000 for Automation Alley 7C’s Program — the seven are concept, context, community, clarity, customers, capital and commercialization — which helps startups land customers.


Source: MEDC to provide more money for entrepreneurship, innovation – Crain’s Detroit Business

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