KALAMAZOO – Those who run Michigan’s cutting-edge businesses call access to venture capital their single most pressing need, but despite the difficulty in obtaining these funds, start-ups are optimistic about their companies’ futures and keeping an open mind about the state’s ability to become a powerhouse in such new economy sectors as the life sciences.
Those are just some of the conclusions found in a Survey of New Economy Businesses in Michigan disclosed by Western Michigan University President Judith Bailey. The survey, completed early this year, was a joint effort of the WMU Research Foundation and EPIC-MRA, a Lansing-based, public-opinion, marketing and research firm.
“New economy businesses now play a significant role in shaping Michigan’s business climate and they intend to play an even greater role in the future,” Bailey said. “Their need for capital to continue growth came through loud and clear in this survey, and the views they expressed illustrate the merit of recent state government proposals to increase the availability of such funds.”
More than 1,100 company representatives took part in the survey. These companies? business focus included engineering, information technology, consulting in a variety of areas, life sciences, telecommunications, health care, scientific services and manufacturing. The companies were small, with an average employee base of 58 and average annual gross sales in 2004 of $6.7 million.
Michigan Venture Capital Association President Mitch Mondry said he agreed with the survey?s assessment that the state needs more money to make things happen.
?Our greatest short coming is capital for early-stage companies,?? Mondry said. ?That why the MVCA took it upon itself to help create the Michigan Venture Fund.?
But before the Venture Fund can make any investments, the Fund board must name a Fund Manager and get non-profit status certified by the Internal Revenue Service. Michigan Treasurer Jay Rising said early this month both tasks could be completed in February. At month?s end, however, no announcement came from the Treasurer?s office.
Mondry said he also is hopeful that Gov. Jennifer Granholm?s call for a $2 billion bond fund to invest in Michigan technology and life sciences start ups would be approved this November. The governor hopes the $2 billion would generate 72,000 jobs over the next decade.
