“Nowhere on earth has more soul than Detroit." - Mayer Hawthorne, American singer and Michigan native
- Detroit's transformation into an innovation hub
- A $20M investment for one cloud computing startup
- Real estate startup making transactions easier
- Bats wearing backpacks
- Name that Flyover City!
APRIL 16, 2020
Photo by David McBee from Pexels
Everybody likes a good comeback story. The city of Detroit has got one of the best.
Historically known as the heart of the automobile industry and the birthplace of MoTown, Detroit faced a low point five years ago when it filed for bankruptcy protection.
But in five short years, a new generation has transformed the city with new strategies and business models, turning it into a thriving hub of innovation and entrepreneurship, particularly in the tech sector.
There are 38 active venture-backed startups in Wayne County, a 58% increase over the last six years. Of those startups, 47% are information technology companies and 19% are mobility-related companies with the remaining companies divided among business services, consumer products, life science, healthcare, and other industries.
Ted Serbinski of Detroit’s TechStars says that the startup ecosystem across Detroit has grown immensely in the past decade, “As we enter this new decade, I see that growth is accelerating at an exponential rate.”
Detroit has an impressive network of resources including talent, mentors, research institutions for product development, and funding.
Access to talent
Michigan’s University Research Corridor (URC) – a top university innovation cluster that includes Michigan State University (MSU), the University of Michigan (U-M) and Wayne State University (WSU) – helps enhance the entrepreneurial ecosystem in the area.
One mentorship example is Detroit’s entrepreneurial hub known as TechTown. Located in a former GM auto dealership, TechTown has helped over 2,000 startups grow by connecting them with funding and other resources. The incubator supports as many as 450 businesses every year.
Another example is Inforum’s inGAGE™ Master Class, which supports women who are serious about growing their companies, even when those companies are still small. Its peer-to-peer forum helps women entrepreneurs form a supportive network and learn to assess the operations, management, finances, and personnel of their companies to examine strengths and challenges.
According to the newly released Detroit Entrepreneurial Ecosystem report:
In the last year, 19 startups in the Detroit area attracted more than $63.8 million from venture capital firms.
Of the 19 startups that received venture capital investment in 2019, 47% are information technology companies and 21% are life science / healthcare companies with the remaining companies divided among the mobility and consumer products sectors.
The New Economy Initiative has also given more than $115M in grants that have helped launch and grow nearly 1,600 ventures in the Detroit metro area.
The strong sense of community in the city has given rise to a pay-it-forward attitude, according to the report:
“Economic trends show that as entrepreneurs lead their startups to exit, they often mentor and invest in new startups that emerge, resulting in a healthy innovation economy.”
It’s quite a comeback story and it doesn't stop there. Trends indicate that Detroit’s entrepreneurial ecosystem will continue to grow and define it as a nationally-recognized startup destination.
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Stephen Ross donates $100M to UM Center for Innovation
Speaking of Detroit, last October, University of Michigan announced plans to build the $300 million Detroit Center for Innovation. It will be anchored by a 190K square foot research and education center, the first phase of a multi-building development on the 14-acre site.
Stephen Ross, Detroit native, “billionaire mega-donor,” and chairman of Related Companies, has announced that he’ll contribute $100 million to kick off fundraising for the project.
The center, which will offer programs for high-tech research, education, and innovation, will serve as many as 1,000 graduate and senior-level undergraduate students across a variety of disciplines, including AI, automotive mobility, financial technology, and cybersecurity.
$20M investment for Triangle cloud data startup
Even in times of economic peril, cloud computing is here to stay. In fact, with millions of people working remotely, connectivity solutions are more important than ever. So perhaps it is no surprise that cloud data connectivity company CData Software, landed a $20 million cash investment even while coronavirus rages.
CData, based in Chapel Hill, got the infusion from Updata Partners, a B2B software firm. The companies will collaborate on cloud offerings. They’ll focus on wrangling the fragmented data so many companies struggle with and help companies establish standards-based data solutions. CData made news earlier this year by landing on the research triangle’s “Triangle Tweener List” of thriving North Carolina companies that are not too small and not too large.
Two Wisconsin managed solutions providers join forces
Tech solutions firm Gordon Flesch Company (GFC) recently agreed to acquire managed service provider Information Technology Professionals (ITP).
Madison-based GFC, which has 26 Midwest offices and more than 600 employees, is a family-owned operation that provides office technology solutions such as cloud, cybersecurity, and managed IT.
ITP, with offices in Milwaukee, Madison, and Appleton, has more than 200 Wisconsin clients in sectors that include healthcare, manufacturing, professional services, nonprofits, and state and local government.
GFC president Patrick Flesch said ITP has a “great reputation for delivering strong technical support and solutions to the customers they serve.”
Paul Hager, president, CEO, and owner of ITP, is excited about the opportunities that lie ahead. “The combined resources and reach of our two companies will be an unbeatable combination.”
St. Louis real estate tech startup is planning to grow
While the residential real estate business is facing a pandemic-driven downturn, one real estate tech startup is actually growing. Based in the St. Louis suburb of St. Charles, Transactly recently raised $3 million in Series A funding—and it plans to use the investment to advance product development and increase headcount.
The company, founded in 2018, developed technology that coordinates real estate transactions, which CEO and founder Bryan Bowles says is aimed at solving, “the kind of chaotic, messy middle of the real estate transaction from contract to close.”
And according to Bowles, the COVID-19 outbreak has made coordinating transaction services increasingly important.
“While we're concerned about the effects COVID-19 will have on our industry, we’re not seeing a slowdown in the number of brokers signing up. In fact, we're seeing new opportunities arise for Transactly, as many brokerages are already opting to outsource transaction support to us, rather than commit to dedicated salaries as the crisis unfolds."
Here is the latest funding news from Flyover Country.
Indy news: Recruit Rooster acquires RocketBuild
Recruit Rooster by DirectEmployers, a recruitment marketing firm headquartered in Indianapolis, has just acquired custom software developer RocketBuild, also based in Indy.
Caregiver Inc. adds four more companies to its portfolio
Over the past few months, long-term healthcare provider Caregiver Inc., based in Ft. Worth, has acquired two Columbus companies—Cori Care and Absolute Care—as well as Indiana-based Houston Group Homes and Personal Care Choices in Tennessee. Caregiver has acquired 15 companies since 2015.
Raleigh-based EternaTear looks to raise $4M
Raleigh startup EternaTear, which is developing “the next generation artificial tear” to combat dry eye, is aiming to raise $4 million. So far, it has landed $2.2 million from 17 investors.
Indy’s Stamus Networks closes on $1.5M seed funding
Cybersecurity company Stamus Networks, based in Indianapolis and Paris, France, has secured seed financing in an overscribed $1.5 million round co-led by Indy investors VisionTech Angels and Elevate Ventures.
The Climate Service secures $3.825M in Series A funding
Climate analytics company The Climate Service, based in Durham, NC, has raised $3.825 million in Series A funding. The round was led by Persei Venture LLC, along with participation by a mix of existing and new investors.
“Backpack" computers provide data on how bats interact
Photo courtesy Simon Ripperger
It sounds like a sci-fi film taken to spoofy extremes: miniscule computers housed in 3D-printed plastic “backpacks,” glued to wild bats. But in fact, there really ARE bats flying around with computer backpacks, which contain accelerometers and fingertip-size sensors that communicate with each other and with ground-based receivers.
It’s all part of a study that relies on a wireless network to obtain data on the social behavior of bats, who—because they hang out in hard-to-reach places like caves and hollow trees—can’t be effectively tracked with other types of equipment.
It took roughly seven years for a team of engineers, computer scientists, and biologists to develop the system, with support from the German Research Foundation, a Smithsonian Institution Scholarly Studies grant, and a National Geographic Society research grant. The lead author of the study is Simon Ripperger, a postdoc scholar in evolution, ecology, and organismal biology at OSU.
It's ... Name that Flyover city!
Useless information that is strangely fascinating.
- What city is home to the first traffic tunnel between two nations?
- What city is known for the Cozy Dog (corndog on a stick) and Horseshoe sandwich?
- What city is the final resting place of the only Major League Baseball player to die from a baseball injury?
Click here for today's answers.
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