Economic Development, Nonprofits, and Small Business & Startups

Is Michigan a startup state?

September 29, 2014
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Is Michigan a startup state?
The book “Startup Communities” is written by venture capitalist Brad Feld of Boulder, Colo. Photo via

A conversation about growing Michigan’s entrepreneurial ecosystem kicked off a conference Sunday in Grand Rapids — designed to align legislative policies with economic development initiatives in West Michigan.

The 2014 West Michigan Policy Forum is a two day, sold-out conference that's attracting business leaders and legislators from across the state and produced by the West Michigan Policy Forum, a nonprofit in Grand Rapids.

Rick DeVos, founder of Start Garden and ArtPrize, introduced the topic of Michigan becoming a startup community, incorporating intellectual, social and capital resources to ultimately serve as a method to attract and retain great talent in the region.

“There are many of us who believe that Michigan can be a great state for startups and are working hard to make that so,” DeVos said. “When most people think about startups and building a startup movement, they think primarily about access to financial capital. But to really thrive, startups require access to intellectual, social capital, to a rich ecosystem of investors and other startups with knowledge, experience and relationships all being shared.”

Although the creation and development of an entrepreneurial-supporting ecosystem on a statewide level poses challenges, guest speaker Brad Feld continued the discussion, as he highlighted how Michigan can build on its entrepreneurial growth and outlined the four principles he believes enables any city to become a startup community.

Feld is the founder of the Foundry Group, an early stage venture capital firm in Boulder, Colo., and author of the book “Startup Communities: Building an Entrepreneurial Ecosystem in Your City.”

Embrace geography

With any major startup community throughout the world, Feld said its unique characteristics are linked to the geography the entrepreneurial ecosystem originated from. Instead of striving to emulate other cities that have been successful, the focus should be on the natural strengths of the resources of the area, in terms of geography, culture, experience and skill sets.

“The real power of your geography — your natural resources — is right in your backyard," Feld said. "You start looking at what kinds of people are attracted to the geography that you have and what things culturally about your geography cause people to be excited. Start by looking inward about what is special about your geography, about Michigan in general, and then about the major cities in Michigan."

4 keys

To create a sustainable entrepreneurial ecosystem, Feld shared four principles a startup community should abide by: allow entrepreneurs to lead rather than supporting entities; maintain a long-term view; willingness to be broadly inclusive; and actively engage the entire entrepreneurial staff through activities and events.

Startup leaders

“You don’t really have entrepreneurial activity generated unless you have the entrepreneurs leading the charge," Feld said. "The feeders are all of the organizations that help support entrepreneurial activity. These spheres play a very critical role, but they can’t lead. They can’t try to organize. They can’t try to control the startup community.”

Long-term view and capital

Feld said that once a group of entrepreneurs takes the initiative to lead the startup community, it's important to focus on long-term goals.

“You have to be willing to go on this long journey, go through the ups and downs, not just in terms of evolution and development of the startup community, but the macro economy, the drivers of society, and different forces that are impacting in positive and negative ways,” Feld said. “If you don’t take this long-term view, what will happen is you will make a little bit of progress and then that progress will disappear.”

Feld said the issue of giving capital or having enough capital to create a viable entrepreneurial community is a concern voiced everywhere.

With the three main types of financing coming from angel investors, venture capitalists and growth capital, he said to attract the most difficult source of venture funding, communities should focus on developing the angel investor layer. As numerous startup companies launch, some will maintain viable growth and attract venture capitalists. 


As engagement of the entrepreneurial community grows, Feld said including all types of interested people will allow a diverse network to form, while building momentum within the system. Within this third principle is an emphasis on mentorship and investors willing to enter into a relationship with entrepreneurs, without knowing if they'll succeed.

“It allows you to continually be putting into the system, and if you get a critical mass of people going, you get this huge amount of energy,” Feld said. “It starts to generate value from the system and gets the startup community really going. As you continue to give before you get, more value comes out of it, and the growth of the startup community accelerates.”


The fourth principle of Feld’s overarching strategy for any city to implement is hosting activities and events frequently to engage people in all roles within the startup community.

Events such as Startup Weekend or Startup Week not only encourage actively practicing entrepreneurship, they also bring awareness to people in the area.

“The ability and dynamics around startups, how they impact cities and states, how they interact with our own society and how people in business as well as in different cities think about how to engage with their cities long term, have become an incredibly important part of all that,” Feld said.

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