On a national scale, the venture capital industry has been shrinking in recent years. That's not the case in Michigan, according to a recent report from the Michigan Venture Capital Association.
The Ann Arbor-based early investment advocacy group's report shows Michigan-based venture capital firms invested $242 million last year, allowing the state to jump from 25th to 15th in national VC rankings. Specifically, the Great Lakes State's number of VC professionals increased over the last two years (53 to 62) while the national numbers decreased (6,328 to 5,887). Michiagn's share of capital under management also creeped up from $1.2 billion to $1.5 billion.
"It's great for us to have such growth, to have so many things happening," says Carrie Jones, executive director of the
Michigan Venture Capital Association.
Part of that steady growth is the state government's consistent efforts to expand the VC industry over the last decade-plus. Efforts and public money investment that began under Republican Gov. John Engler, continued under Democratic Gov. Jennifer Granholm, and are being further reinforced by current Republican Gov. Rick Snyder (a former venture capitalist), have made it possible to flourish in trying times for the overall industry.
Venture capital funds backed with public money, such as the
Venture Michigan Fund and the
Michigan Pre-Seed Capital Fund, have kept capital flowing despite the worst economic crisis since the Great Depression that made seed capital and financing scarce.
"There are a lot of pieces that need to come together to make a strong entrepreneurial ecosystem," Jones says. "It's good to know the state will support this industry."
Source: Carrie Jones, executive director of the Michigan Venture Capital Association
Writer: Jon Zemke
Read more about Metro Detroit's growing entrepreneurial ecosystem at SEMichiganStartup.com.
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