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Entrepreneurship in Ann Arbor, Michigan

I just returned from Ann Arbor where I was on a "quest" for the center of entrepreneurship, startups and innovation.

It’s always been a thesis of mine that Ann Arbor should have a vibrant startup and entrepreneurship ecosystem.  It’s a lot like Boulder in many respects. 

That being said, my alma mater has previously disappointed me in their lack of innovation and culture surrounding early stage software and IT.  They’ve been great in some areas like life sciences and manufacturing, but for software / IT / Internet, there hasn’t been a lot of action.  Clearly I’m biased as a VC that invests in these areas, but so do the majority of VCs in this country and it always felt a bit odd why Ann Arbor wasn’t targeting these sectors.

This time was different.  There was a lot more energy surrounding software; from the engineering school, to the business school to even LS&A.  In fact, whereas two years ago there were few organizations on campus supporting these activities, now there are several that are deeply engaged in helping good folks with good ideas out. 

I gave a lecture one night to a group at the business school outlining my thoughts on what makes a good early-stage innovation and startup ecosystem.  While I was my usual rambling mess, Mark Maynard of the tech transfer office wrote a cogent and thoughtful summary.  If you missed the presentation, he pretty much gets all the points.  In the future, I plan on doing some writing on what makes a good startup ecosystem, so stay tuned.

For those of you in Ann Arbor and are looking for where to turn to for support, I’d suggest some / all of the following:

www.a2geeks.com and www.annarborstartups.com – both brought to you by Dug Song who was the most inspiring person that I met in Ann Arbor this trip.  He is deeply engaged trying to coordinate all of the startup activity on campus and he is well-experienced in having been a startup junkie and hacker all of his life. 

The Center for Entrepreneurship – although housed in the engineering school, the center is working hard to coordinate all students and professors, regardless of school affiliation on campus.  The fact that Marc Weiser from RPM Ventures is on the board (who is an early-stage VC, including software investor) should help this mission.

There were many other organizations, too and not mentioning them is no slight, rather these two organizations seemed to be the easiest for the entrepreneur to get directly plugged in;  the first two be the consummate grass roots efforts while the latter being a more formal offering. 

In summary, there are some positive signs of life in Ann Arbor in the early-stage software / IT / Internet ecosystem.  I think they have all the tools to become an important investing geography, but only time and their collective efforts will tell.  As a former long-time resident, I sincerely wish them the best of luck and offer any help that I may give in the future.  Thanks Ann Arbor for being such great hosts. 

April 6th, 2009     Categories: Entrepreneurship, Venture Capital    
  • http://www.boulder2beijing.com Micah

    Above you say that, "although housed in the engineering school, the center is working hard to coordinate all students and professors, regardless of school affiliation on campus."

    To me, it's always struck me as weird that entrepreneurship centers are usually collocated with business schools. Any thoughts on this?

    • http://www.jasonmendelson.com Jason Mendelson

      Well, two points:1. Part of the “although” comment was because the engineering school is on North campus and not central campus 2. And yes, many centers are in the business school.  Maybe because they are good at organizing, seeing what could be commercialized and many VCs have business school connections.I would point out that in Boulder, it’s the law school – Silicon Flatirons, so one never knows where the nerve center may lie…

  • rock mcqueen

    I am originally from detroit, started a business in boulder, and moved back to ann arbor – got more support in ann arbor in 6 months than in colorado in 6 years – lots of good things happening here – you hit the tip of the iceburg.

    it is all about location – if you are doing a glue / social networking startup, go to boulder – if you are doing anything else with a real sales model, then strongly consider AA – the MEDC is doing an amazing job and are providing matching funds up to $250k no strings.

  • jkloubec

    Considering the strength of UM's computer science program, I would have expected more startup activity, but have always thought the innovation drag was more to do with Detroit. AA does not have the scale by itself and gets little help from Detroit since it does not have "pull" like other cities or significant ecosystems outside of auto which has been a laggard industry. It is not to say there is nothing in AA, but I felt the talent available from the school has been underutilized in the local market. I am glad to hear it is picking up and hope the trend continues.

  • http://www.northcoastvc.com laspegren

    I've got portfolio companies in Ann Arbor and Colorado, and it always amazes me how the environments are so similar. They both suffer from the our eco-sphere is not here problem which makes finding people, raising capital and doing all the things that Valley types are so good at hard. If I hear one more time that you cannot recruit a CEO or good sales and marketing talent in either location I will projectile vomit.

  • http://www.jpbardwick.com Peter Bardwick

    I'm a UofM (2 degrees) grad and Ann Arbor fan. There are other resources in Ann Arbor associated with the B School and the Zell Lurie Institute for Entrepreneurial Studies: http://www.zli.bus.umich.edu/resources_research/. I recently became a member of the Advisory Board for the Wolverine Venture Fund–one of the first student managed investment funds in the country–and am impressed by the student enthusiasm and community support.

    Ann Arbor isn't Palo Alto or Boston but it has developed many of the ingredients for success in the past 10 years. Two of the local venture funds have successfully raised new money which is quite an accomplishment in this environment. Ann Arbor is progressing, if it can build the ecosystem it will take time and a handful of homegrown success stories.

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  • http://www.rpmvc.com Marc Weiser

    {Posted in 2 comments – 1 of 2}

    Thanks for the visit! Always great to get fresh perspective in A2, its needed. Your message was consistent with what we believe here. We've had a small but dedicated group that has carried the water for years, but it takes a larger community. We aren't just at the beginning, but the momentum in the last few years has given us hope.

  • http://www.rpmvc.com Marc Weiser

    {2 of 3 }

    The key now is sustainability, we’ve seen momentum build in the past, only to fall flat. It will take everyone pulling in the same direction, something we’ve not been good at in the past. As I have had the opportunity to view both Ann Arbor and Boulder it strikes me that the biggest difference is the bonds formed between the different constituencies in Colorado are are much stronger. Every visit I’ve had to Colorado has led to dinners, poker nights, even bowling where entrepreneurs, VCs, angels, university faculty, etc.. were always in attendance – and all of these were just regular occurrences. It wasn’t forced, it was because everyone enjoyed the energy and had a true respect for each other.

  • http://www.rpmvc.com Marc Weiser

    {3 of 3}
    I hope that the entrepreneurs, university, government, and yes even the VCs in Ann Arbor realize that the focus has to be on collaborating together. In the past we would hear each group complain about the other, today we more frequently hear praise. We are on the verge of building a permanent foundation or our entrepreneurial community in Ann Arbor. Now is the time for everyone to get involved, come out from their hiding spots, and work on the bigger picture together. Otherwise we will repeat the failures of the past.

    Thanks again for your visit to A2, we llok forward to seeing you again soon.

  • http://www.jasonmendelson.com Jason Mendelson

    It was my pleasure.  Folks like you are making it all the worthwhile. 

  • http://www.club-penguin.org/ club penguin cheats

    I would have expected more startup activity, but have always thought the innovation drag was more to do with Detroit. AA does not have the scale by itself and gets little help from Detroit since it does not have "pull" like other cities or significant ecosystems outside of auto which has been a laggard industry.

  • http://www.tpservice.org mathew

    Thanks for your suggests of where to turn to for support.

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    Thanks for your suggests of where to turn to for support.

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    I hadn’t thought of Ann Arbor as a start-up town. I guess it’s to be expected considering the amount of graduates this college town generates.

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    I think this blog has some good resources as I have come to this blog and have found it quite interesting. I am a business management student by the way.

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