LANSING – The Michigan Economic Development Corp. has announced Michigan Strategic Fund investments of $4.5 million into two venture capital funds to help grow the venture capital industry in Michigan.
Said MEDC President and CEO Michael A. Finney. “We are confident that by co-investing in these promising funds, we can continue to grow Michigan’s venture industry and accelerate the growth of innovative technology start-ups.”
In June 2012 the Pure Michigan Venture Development Fund opened for applications from first and second generation venture capital funds in Michigan for the primary purpose of increasing their ability to raise additional funds and become viable entities, with the ultimate intent of increasing the number of venture investments in the state.
From an initial authorization of $5 million for this round of funding, the MSF has approved two funds for awards of $2.25 million each:
* Michigan eLab (Ann Arbor) – Michigan eLab is a seed to early stage technology venture fund focused primarily on IT and life science/health care companies from the University of Michigan ecosystem (faculty, students, alumni, university research and research partner institutions).
* Resonant Venture Partners (Ann Arbor) – Launched in 2010, Resonant Venture Partners makes seed and early stage investments in companies developing cloud infrastructure, software and services.
The PMVDF will invest in up to two more new venture funds in the state with up to $2.25 million each. Awarded venture funds must raise additional capital from the private sector (at least 4.5 times the state’s investment) and invest in Michigan companies. The PMVDF program is accepting applications until Feb. 28.
To qualify, applicant venture funds are required to have raised $1 million in private capital from at least three unrelated investors at the time of application, which must be evidenced by signed investor commitments. Funds that have raised more than $25 million are not eligible to apply. Funds with target sizes greater than $50 million will not qualify for this program.
Proposals must be submitted to the MEDC via email sent to VDF@Michigan.org. Once the MEDC has received the application, applicants will be contacted on how to pay the application fee. Proposals will not undergo peer review until the application fee has been received.
There will be a $1,000 application fee due once a review confirms that the application meets the required minimum guidelines. There will be a peer review of the venture fund’s business plan as required under the 21st Century Jobs Fund legislation.
Questions pertaining to the Pure Michigan Venture Development Fund should be submitted electronically toVDF@Michigan.org. Responses to questions will be posted to the program web page on a regular basis: www.michiganadvantage.org/PureMichiganVentureDevelopmentFund.
The complete guidelines for the PMVDF Fund can be found at http://www.michiganadvantage.org/pure-michigan-venture-development-fund/