Ann Arbor SPARK, other local groups land $15.5 million from Michigan Economic Development Corp.
Michigan Economic Development Corp. CEO Michael Finney, seen here speaking at the Detroit Regional Chamber's Mackinac Policy Conference in June alongside Gov. Rick Snyder and DTE Energy CEO Gerry Anderson, said the 21st Century Jobs Fund would distribute millions in cash to various economic development groups throughout the state.
Nathan Bomey | AnnArbor.com
Three Ann Arbor-based economic development agencies received $15.5 million from the Michigan Economic Development Corp. for several programs to invest in tech startups, train entrepreneurs and provide various services to early-stage companies.
The 21st Century Jobs Fund, managed by MEDC through the Michigan Strategic Fund, announced this afternoon that it is distributing millions to several different groups.
Ann Arbor SPARK, a public-private group co-founded by Gov. Rick Snyder and formerly led by MEDC CEO Michael Finney, got $10.8 million for three programs. Of those funds, $9.17 million will go to SPARK's Michigan Pre-Seed Capital Fund, which invests in early-stage companies throughout the state on behalf of the MEDC; $1.05 million to a new initiative called the Michigan Angel Fund, which will invest in very early-stage ventures; and $600,000 to the Accelerate Michigan Innovation Competition for startups.
“The funding awarded by the MEDC recognizes Ann Arbor SPARK’s leadership in creating and executing programs that drive economic growth in the state,” SPARK CEO Paul Krutko said in a statement. “Ann Arbor SPARK has a track record of collaborating with our economic development partners throughout Michigan, and these efforts have generated broad impact and business growth. MEDC’s funding awards will extend these programs that are critical to business expansion and the creation and retention of jobs in the state.”
SPARK makes investment decisions in coordination with the state's 15 high-tech economic development districts called SmartZones, which oversee the investment funds. The Michigan Pre-Seed Capital Fund, launched with funds from the MEDC under former Gov. Jennifer Granholm's administration, has invested or loaned $13.4 million to 61 companies, including several in Ann Arbor.
MEDC also said today that it had distributed $3.1 million to the Ann Arbor-based nonprofit Michigan Venture Capital Association for programs to develop executive leadership for startup companies and venture capital firms and to develop new angel investors throughout the state.
Biotechnology Business Consultants, an Ann Arbor-based for-profit company, received $1.6 million to help early-stage companies secure grants from the federal government.
MEDC's decision to use the 21st Century Jobs Fund dollars to distribute funds to economic development groups marks a change in strategy from the early days of the fund, when MEDC used the dollars to loan cash directly to startup companies.
Finney and Snyder have argued that the MEDC is not well positioned to make informed decisions about business investments and that cash should be distributed to groups that are on the ground and can make better decisions.
It comes after AnnArbor.com reported in January that the MEDC was planning to distribute more funds to economic development groups throughout the state.
“Early-stage companies require seed capital and access to a strong network of public and private resources,” Finney said in a statement today. “We are confident that with the funding of these organizations and the types of programs — from federal grant support to business plan completion to providing services and angel and pre-seed funding — we will continue to accelerate the growth of innovative technology start-ups in Michigan.”
Other groups that received cash included the statewide Michigan Small Business & Technology Development Center, which received $3.5 million to set up a fund to distribute cash to other business acceleration groups; Lansing-based Great Lakes Entrepreneurs Quest, a nonprofit formerly based in Ann Arbor that will use its $1.1 million to run a business plan competition; Western Michigan University's Biosciences Research & Commercialization Center, which will use $3.8 million to invest in startup life sciences companies throughout the state; Detroit Creative Corridor Center, which got $400,000 to provide services to digital firms and media production companies; the Inforum Center for Leadership of Detroit and Grand Rapids, which got $700,000 to encourage mentorship and boost women entrepreneurs.
(Editor's note: AnnArbor.com Executive Vice President Laurel Champion serves on Ann Arbor SPARK's Executive Committee.)
Contact AnnArbor.com's Nathan Bomey at (734) 623-2587 or nathanbomey@annarbor.com. You can also follow him on Twitter or subscribe to AnnArbor.com's newsletters.
Comments
Alan Goldsmith
Thu, Jul 28, 2011 : 10:42 a.m.
Audit? Ask for audit numbers of get them from, say...a board member and publish the information? Why that would be...eh, I don't know, reporting?
Townie
Thu, Jul 28, 2011 : 12:42 a.m.
Ask for SPARK's audit and see how far you get. OK, SPARK - post it, huh. Or is there something in it that no one can be allowed to see? SPARK is just taking money (public money) and laundering it (taking a piece of it) and then handing it to someone else. Nice work if you can get it. And SPARK's job creation figures? Just like Rick's -- made up and not verified independently. Good deal -- other people's money, you get to make up your own 'performance' figures and you get to hide your audit. Cool.
Tom Whitaker
Wed, Jul 27, 2011 : 11:38 p.m.
Snyder cut school funding drastically and is using some of the savings to give to his friends at SPARK. Ann Arbor also funnels school tax money to SPARK via the LDFA. I think it's clear that this is an unnecessary double-dip into the pockets of our schools. Dismantle the LDFA, and send that tax money to the schools--the purpose it was collected to serve in the first place.
Monica R-W
Wed, Jul 27, 2011 : 11:28 p.m.
Talk about funneling tax payers money for your own purposes? Wonder how many Mom and Pop small businesses will get any money from this 15 million? I thought the state was broke? So broke that Gov. Snyder cannot wait to kick over 12,000 women and CHILDREN off of food stamps and medicaid? But, he has 15 million dollars to give (of OUR MONEY) a organization he founded? Smells a little fishy...Just saying!
glacialerratic
Wed, Jul 27, 2011 : 10:31 p.m.
Raw cronyism and state-directed corporate welfare to private business from pubic funds. Is this how the free market works?
Mike K
Wed, Jul 27, 2011 : 9:50 p.m.
Wow - the anti Rick crowd got here fast lol. Jenny did the same thing, yet when she did it, it was to build a strong middle class, and it was deemed "good" by the left. Why was that? Ah, that's right, she was a democrat, and Rick is a republican..... There's always a reason. We don't need corporations, we need more government jobs. Yeah, that'll fix everything, especially if those government jobs are unionized to gain leverage and extract more tax from the rich. That's how it's supposed to work lol.
Mike K
Thu, Jul 28, 2011 : 12:25 a.m.
Jenny funded Spark gentlemen. There is no such thing as an honest and decent corporation; how dare you insinuate such David. Corporations are in the business of making profit and nothing could be worse than that, right David. Candidly, you need to grind your partisan axe somewhere else. It appears to me that most appreciate what Snyder is doing here. You are in the minority, and you always will be.
David Briegel
Wed, Jul 27, 2011 : 10:43 p.m.
No, he's a TeaPublican and we are just now finding out what that really and truly means. And we don't like it one bit! We need HONEST and DECENT corporations who contribute value to our society. Grind your axe somewhere else. Or join the rest of us and call for an independent audit of the fraud ridden SPARK and MEDC! Surely there is nothing to hide!?
Cash
Wed, Jul 27, 2011 : 10:42 p.m.
Granholm did NOT start SPARK, Snyder did. Good try though.
nickcarraweigh
Wed, Jul 27, 2011 : 9:23 p.m.
Shades of Kwame Kilpatrick! Except it's worse. If this ain't a crime, there's something wrong with the law
quetzalcoatl
Wed, Jul 27, 2011 : 9:18 p.m.
This stinks. Snyder founds the agency, then funnels it almost $11 million even before the ink is dry on cutbacks to welfare recipients in the midst of the worst economic downturn in four generations, and while he is hammering state workers for still more givebacks and takeaways. where do I sign on the recall petition? And Michael Finney, Snyder's old co-racketeer from Spark, is the same guy who not long ago said it was fruitless for the Michigan Economic Development Commission to even ATTEMPT to draw business to Michigan. A moral man who truly believed that would quit his job, because it means he is taking money under false pretenses. That's a crime, he's a criminal, and so is this whole gang of robber barons born again a new Gilded Age. Bread lines for the poor, millions for corporations.
alan
Wed, Jul 27, 2011 : 9:11 p.m.
Is this a joke? Snyder and Finney give 10M to their buddies at SPARK? Criminal investigation.
Cash
Wed, Jul 27, 2011 : 9:06 p.m.
More money throw nto big business....and nothing coming back i nthe form of jobs. SPARK refuses to answer to taxpayers and will not release any information regarding where the money goes. And yet, the Tea Party doesn't complain about this form of welfare...the corporate klind.
Mike K
Thu, Jul 28, 2011 : 12:20 a.m.
Well Cash, one can compare 60 years of federal intervention, or 6 months of Snyder's intiative................ And since you brought it up, what happened in the 8 years of your beloved Jenny's reign and all the money she spent on trying to attract tax generating business's to Michigan? I'll help answer that. I relocated here in 1991. For Michigan, it was a job gained - a taxpayer earned. Something changed?
Cash
Wed, Jul 27, 2011 : 10:41 p.m.
Name the successes of SPARK...millions funneled into it....and they refuse to report where it went. They claim jobs have been created but REFUSE to account for them...WHERE are those jobs ...this is a Snyder venture and now he funnelsmy tax money into it for his corporate buddies?
Mike K
Wed, Jul 27, 2011 : 9:54 p.m.
Start ups = big business? C'mon man? It's fine when Obama does it. Why is it not fine when "Slick Rick" does it? One last thing there Cash, the private sector generates tax revenue, the public sector consumes it. Do you see how it works?
Larry Eiler
Wed, Jul 27, 2011 : 8:39 p.m.
The awarding of $15.5 million by the MEDC to train and invest in startups and early-stage companies in one more positive step in the "relentless positive action" approach Gov. Snyder is taking. Solid and ongoing funding is all the state needs to get us all moving along the growth path. It is good to see this strategy being delivered and on course. Larry Eiler
Dr. Rockso
Wed, Jul 27, 2011 : 10:58 p.m.
Hey Larry this is peachy. From the following link it looks like Rick and Spark have been writing checks to you. <a href="http://www.innovativebusinessresults.com/larry.html" rel='nofollow'>http://www.innovativebusinessresults.com/larry.html</a>
David Briegel
Wed, Jul 27, 2011 : 10:45 p.m.
Larry, I know you to be a fine and decent man and an upstanding citizen. Please join those of us who are calling for an independent audit of MEDC and SPARK.
Audion Man
Wed, Jul 27, 2011 : 10:36 p.m.
@Larry Eiler Your response sounds like a press release.
Mike K
Wed, Jul 27, 2011 : 9:44 p.m.
Nick - he does, as do I. We pay State income taxes.
nickcarraweigh
Wed, Jul 27, 2011 : 9:24 p.m.
Then write them a check Larry and put your money where your mouth is.
Dr. Rockso
Wed, Jul 27, 2011 : 8:18 p.m.
Ann Arbor Spark is a joke. This is corporate welfare. These start ups should be getting their seed money from all the tax savings that the RICK stole from the poor and elderly and gave to the private sector, I'm not clowning around!