A new venture capital fund is being formed in West Michigan with $6 million from the state’s 21st Century Jobs Fund.
Michigan Accelerator Fund I L.P., which will total $10 million, was formed to support early stage life science and technology companies.
Fundraising for the new fund and its first investment activity are both expected in early 2011.
MAF1 was developed specifically to leverage the hundreds of millions of dollars already invested in West Michigan’s science and research infrastructure by filling the region’s early stage funding gap.
The fund intends to drive forward the new economy of Michigan, providing a path to funding and partnerships for the commercialization of new regionally developed opportunities. MAF1 presents its university and research institution partners with a fresh channel for technology transfer funding.
While MAF1 will focus on healthcare and life sciences investments, a portion of its funding plan will be allocated to other important Michigan industries such as advanced manufacturing, alternative energy, and homeland security.
MAF1 is sponsored and supported by leading West Michigan investors, research organizations and socio-economic stakeholders, including Grand Valley State University, the Van Andel Research Institute, Hope River Ventures, the West Michigan Science & Technology Initiative, Grand Angels, the Michigan State University Foundation, The Right Place Inc. and Lakeshore Advantage.
MAF1 will be managed by John Kerschen and Dale Grogan, principals at The Charter Group, a Grand Rapids-based merger and acquisition advisory firm.
“This Fund reflects the collaborative spirit and forward-looking leadership that has typified West Michigan over the years,” Kerschen said. “We have an opportunity to accelerate the development of high-growth industries and the creation of knowledge-based jobs — both of which are necessary for long-term economic success across our region.”
Kerschen also noted that while more than 20 percent of the country’s research expenditures and patents occur in the Midwest region of seven states, less than 6 percent of venture capital investments occur in the region.
“We cannot simply wait and hope this situation changes,” he said. “This fund will help us more effectively chart our own economic path in the years ahead.”
In addition to providing early-stage capital for high-growth businesses, MAF1 will also include a number of programs aimed at enhancing the support infrastructure for emerging companies.
* Mentor-in-Residence Program: Two to three mentors will be identified who have deep industry and scientific expertise and are willing to proactively incubate opportunities until they are successfully launched.
* Student Internships: As many as 10 Grand Valley State University Seidman School of Business students will be offered summer internships during the fund’s initial five years of operations.
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