GRAND RAPIDS — The culture has improved for entrepreneurship in West Michigan, according to a new report by Grand Valley State University researchers.
The 2013 climate report, commissioned by Grand Valley’s Seidman College of Business and Center for Entrepreneurship and Innovation, is a redo of the first report conducted in 2009.
The authors of the report, Paul Isely, professor of economics; Sridhar Sundaram, professor of finance; and Michael Kurley, a student at Center for Entrepreneurship and Innovation, found two key improvements since 2009.
“The culture has improved and changed for entrepreneurship,” said Isely. “We are now embracing entrepreneurship as a goal. That wasn’t the case four years ago. This change in culture means another improvement, which is we’re attracting more capital to West Michigan and there is more access to venture capital and more professionally controlled venture capital.”
Isely said the report indicated areas where improvement is needed. He said entrepreneurs are not accessing federal funding that can help their companies, and the cost of doing business in West Michigan is higher than the national average. “I’m surprised by the cost issue because we have a very good tax climate and do well with wages,” Isely said.
Isely added that while the availability of capital and the business climate has improved, a better job needs to be done educating the workforce and retaining young workers.
For more information, contact Paul Isely at (616) 331-7418, or Sri Sundaram at (616) 331-7433.
Culture: The population in Grand Rapids is less diverse than the national average. It also suffers from the lack of retention of young workers. This has a negative impact on the entrepreneurial climate of the region, but it is tempered by the fact that the State of Michigan has been creating new firms faster than the national average suggesting a return of the entrepreneurs to the state.
Capital: Michigan is attracting more venture capital funding compared to prior years. The access to risk capital is improving faster than the rest of the nation. Michigan continues to lag behind in attracting SBIR and STTR funds, which is a key source of funds for entrepreneurial companies.
Climate: While the cost of doing business in Grand Rapids is still high, it is improving due to the favorable change in the statewide business tax climate. However, Grand Rapids has fallen behind in recruiting new talent, especially from abroad, to supplement the local skilled labor force.
Talent: Compared to the cohort cities, Grand Rapids ranks lower in patent generation, percentage of adults with bachelor’s degrees, and people employed in creative occupations — all indicators of the talent pool from which new businesses are established.