By MVCA Executive Director Maureen Miller Brosnan
One of the greatest challenges facing entrepreneurs when launching a business is finding capital. Funding is often the most critical resource needed to fuel a company’s growth, but many don’t know where to start or how to connect with different sources of financing or entrepreneurial support organizations available in their community. One of the primary goals of Michigan Venture Capital Association (MVCA), the trade association for the venture capital and angel community in Michigan, is to foster a collaborative entrepreneurial and investment community. With this initiative in mind, we outlined investment and entrepreneurial resources for entrepreneurs who are launching their businesses in Michigan.
Step 1: Identify entrepreneurial support organization that can help you refine and build your company
Currently, there are 96 entrepreneurial support organizations in Michigan! These organizations provide a wide array of services related to building a business plan, finding office space, doing market research, attracting talent, networking, and more. Many times, these services are free! Many entrepreneurial support organizations work with various sectors and offer a wide range of services based on the company’s stage of growth.
Step 2: Identify investment organizations that invest in your company’s stage and sector
With 56 investment organizations in the state, entrepreneurs, there are many options for raising capital for your company.
Angel groups and accelerators are good sources of funding for newly launched companies. Often, angel groups are comprised of individuals who were previously entrepreneurs who are still actively involved as leaders in their industry. Accelerators, on the other hand, typically consist of a designated cohort who participate in a program for a limited time that provides mentorship and resources. Both angel investors and accelerators typically invest in companies at earlier stages than venture capital firms.
Venture capital firms offer investment to high-tech, high-potential companies that are earning revenues from operations and nearing (or past) cash flow positive. In exchange, venture firms receive equity in the company. A great venture capital investor will provide investment in addition to industry connections and expertise.
Step 3: Stay Connected!
To navigate Michigan’s entrepreneurial and investment community, entrepreneurs can view the 2017 Michigan Entrepreneurial & Investment Landscape Guide online to quickly connect with all the entrepreneurial and funding resources available in Michigan. Additionally, entrepreneurs can navigate every startup company, investor and entrepreneurial organization by geography on its Landscape Map at MichiganVCA.org.
With these resources, entrepreneurs can easily identify information to help them connect with capital, talent, research, and community. These connections help Michigan build a stronger entrepreneurial and investment community, creating more economic opportunities for everyone in the long run.
MVCA Executive Director Maureen Miller Brosnan