|Three startups win more than $500,000 seed money|
by Gary Gosselin | Oakland Business Review
Monday July 07, 2008, 11:56 AM
Startup companies in Flint, Midland and Novi have landed more than $500,000 in pre-seed money to give their efforts a boost.
Flint's Global Energy Innovations, Inc. received $250,000; Novi's 3IS got $92,499 and Fulcrum Composites in Midland received $200,000.
The three join 22 others that have received $5.4 million as part of a program that targets start-ups in one of the state's identified competitive edge technology and have the sponsorship of its local SmartZone. In addition, companies must have received grant, angel or venture capital funding greater or equal to funding requested of the Michigan Pre-Seed Capital Fund.
Global Energy, sponsored by the Ann Arbor/Ypsilanti SmartZone, provides advanced auxiliary high temperature PEM fuel cell power systems capable of reforming various fuel sources to provide multiple, reconfigurable power output channels.
3IS, sponsored by Automation Alley, received $92,499. 3IS is a business information aggregator that provides Web-based data portals for the global electronics industry.
Fulcrum Composites works with advanced materials and designs to develop structural components for the trailer and energy industries and was sponsored by the Mt. Pleasant/ Midland SmartZone.
The Michigan Pre-Seed Capital Fund is an equity fund that invests in technology-based companies to support business formation and acceleration. The fund will receive the same returns as the third party investor. The returns that the Michigan Pre-Seed Capital Fund receives from its investments will serve as seed money for the Fund's continuation.
Each SmartZone is responsible for recommending an investor to the review board. Ann Arbor SPARK serves as the Fund's administrator. The fund just received its first loan payback - with interest -- in May from an investment in a wind turbine startup company, Simms said.
But, he said, the organization only has funds for about five more investments with the original $8 million it was awarded in 2006 from the Michigan 21st Century Jobs Fund to operate the program.
Simms said he's talking to the Michigan Economic Development Corp. to obtain more funds and was confident the organization can be self-sustaining in just a few years.
"Those contacts have been made but its not a done deal yet," Simms said. "It's a high priority were told by MEDC and we're hoping to get funded fairly soon."
Over the 17-month life of the program so far, 70 companies have expressed interest and 31 have gone through the entire process.