Bullish About Michigan

Last week, Chrysalis attended the annual Michigan Growth Capital Symposium in Ypsilanti.  Just prior to the event, the Michigan Venture Capital Association published the 2012 annual report, releasing the following state investment data:

  • 33 Michigan companies closed 47 investment deals worth $242 million in 2012.

  • The 33 deals represent a 27% increase from 2011 and the most money invested in the state since 2008.

The MoneyTree Report publishes an annual state ranking, based on the amount of VC investment in each state.  Here’s the MoneyTree Report’s breakdown, showing how Michigan stacks up:

Note:  The MoneyTree and MVCA data differs slightly based on each report’s methodology.

We caught up with Alan Ying to discuss the opportunities Chrysalis Ventures sees in Michigan.

Q:  Chrysalis has been investing in Michigan for nearly two decades.  How has the innovation & startup ecosystem evolved?

Alan Ying:  Chrysalis began investing in Michigan in the early 90s, a time when the state began to reinvent itself as a technology and innovation hub — pivoting from an economy based solely on the auto industry.  Michigan has top-notch higher education and research institutions as well as well-directed government support — factors necessary to create an innovation economy.

Koleman Karleski wrote about this topic for the Wall Street Journal’s Venture Capital Dispatch.

Q:  Clearly, the data shows the midwest can’t compare to the amount of venture capital invested on the coasts.  But, startups in the midwest and south continue to grow and attract capital.  Why?

Alan Ying:  We continue to see these geographies building lasting companies that create jobs.  While the numbers don’t compare to investment in Silicon Valley nor Boston, these are consistently strong numbers.  More and more we’re seeing entrepreneurs build businesses in middle America.  As we discussed in an earlier post, geography will become less and less of an issue to entrepreneurs, venture capitalists and, most importantly, customers.