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Southeast Michigan is a victim of more than seventy years of economic success. The region was once one of the most innovative places on the planet, attracting and developing multitudes of talented entrepreneurs. The auto industry became one of the most profitable industries in the world. As a result, the region’s ability to innovate and create became more and more concentrated within and around the auto industry. Investment and lending markets became more restricted to opportunities within auto design and manufacturing. Education and training programs became limited to jobs within and supporting the auto industry. If southeast Michigan is going to move to a more innovative economy, we must restore the structures and resources necessary for a robust entrepreneurial eco-system.
The entrepreneurial eco-system module of activity is the most developed to date as a result of some early grantmaking and collaborations established by NEI. Five focus areas will anchor our work to enhance and expand the entrepreneurial eco-system.
The first investment is in entrepreneurial training and education. The Kauffman FastTrac programs at TechTown and our support of Bizdom U are examples of programs that have been funded in this focus area. Success in this area will be principally measured by the number of new business start-ups, jobs created and business growth or expansion. The work of the Urban Entrepreneur Partnership will help educate existing tier 2 and 3 manufacturing firms as they migrate from dependence on the auto industry to a more diverse client base. Success in this area will be measured by the percentage of new business that come to the selected suppliers from non-automotive industries and the number of jobs maintained and created within the selected suppliers.
Connecting entrepreneurs to needed resources is another area of focus. The iBridge Program, an online “Craigslist” for primarily university-based technology and intellectual property, is an example of a program in this focus area. The iBridge Program was funded as a part of NEI’s $5 million TechTown grant. TechTown is working with the University Research Corridor (URC) to expand iBridge to as many Michigan colleges and universities as possible. Success in this area will be measured by the number of successful funding matches, the increase in resources available and utilized by entrepreneurs, and the number of users of the systems.
This module of activity will also work to influence university technology transfer from concept to market. We will explore pathways and programs that can increase tech transfer. Initial discussions with partners indicate that NEI might be helpful by providing modest resources to assist in the development of common intellectual property and tech transfer policies for Michigan colleges and universities. NEI’s recent commitment to support a Kauffman Post-Doctorate Fellow is another example of an investment that will improve tech transfer. Staff is beginning to explore how NEI might replicate the fellowship for Michigan universities exclusively. Success in this area will be measured by the increase in technology licensed for commercial use and new business start-ups that result from tech transfer.
NEI leadership is currently exploring several areas where we believe NEI can positively improve access to capital. Specifically, NEI is working to develop a product that will provide equity or small low interest loans for the companies that are being developed by FastTrac graduates. Supporting the “deal flow” that will result from our investment in FastTrac is a logical and needed next step. NEI is also looking at how attracting management talent can improve venture capital funding opportunities.
In order to provide greater opportunity for economic inclusion, NEI staff will continue to monitor ShoreBank Enterprise Detroit’s loan fund, which was funded in May 2009. This program provides a much needed neighborhood business and employment balance to our efforts. NEI will also explore new efforts to develop support for neighborhood businesses that promote employee ownership.
Finally, NEI is working with the Urban Entrepreneur Partnership to assist in finding access to capital for the minority supplier migration program that was funded by NEI in May 2009. NEI staff and Economic Advisors are exploring how policy changes might meet needs in this area.
Success in all access to capital areas will be measured by new money attracted and released for business start-up and expansion.
The last focus area is to create a district that promotes an entrepreneurial culture. Many of the grantmaking activities of NEI and several of our funding partners have been focused in Midtown Detroit, which is quickly becoming a district that will attract talent and promote entrepreneurial activities. The creative economy grantmaking of NEI is anchored with two Midtown capital projects – the College for Creative Studies’ Argonaut Project and the Sugar Hill Arts District and will be a key component of creating an entrepreneurial culture as the effort works to attract creative businesses. The FastTrac programs will expand the capacity of Midtown-based TechTown and will drive hundreds of entrepreneurs into the district. Kresge’s support of the M1 rail project will help to bring transit and transit-oriented development to the district. The Ford Foundation has been discussing how it might best support transit-oriented development. The Hudson-Webber Foundation has embarked upon a vision to drive young talent into the district as well. Creating this culture in a geographic district is a key component of attracting and retaining talent and developing a critical mass of entrepreneurs, investors and creatives.
With the focus and leverage of many funding and strategic partners, Midtown has the opportunity to become one of the country’s most creative and entrepreneurial districts. NEI will work to develop an entrepreneurial indicator that will measure the activity and density of entrepreneurs living and working in the Midtown district.
If you are interested in applying for a grant to address this area of interest, please see our How to Apply section of the website.
If you are interested in learning more about our grantees, please see the Our Grantees section of the website.
Thank you for your interest.
Strategic investments and regional collaboration are helping the New Economy Initiative and partner organizations promote economic revitalization in southeast Michigan.
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