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Ann Arbor SPARK scores $500K for Michigan Angel Fund

The Michigan Angel Fund has enjoyed so much success in its first year that organizers are coming out with a sequel in 2014.

The Michigan Economic Development Corp is giving Ann Arbor SPARK, which manages the Michigan Angel Fund, $500,000 for the continuation of the Michigan Angel Fund’s first investment vehicle and then some.

"This is allowing us to raise a second fund," says Skip Simms, manager of the Michigan Angel Fund and senior vice president of Ann Arbor SPARK. "The first fund is nearly all invested. It will allow us to continue investing in early stage technology companies across the state."

The Michigan Angel Fund is an angel-investment equity fund that specializes in early stage investments. It only invests in Michigan-based tech start-ups in the hopes of growing the Great Lakes State’s new economy.

It has 72 members and has made six investments in its first year. Those investments range from $100,000 to $250,000 and are part of seed rounds for startups looking to raise between $250,000 and $2 million. Its latest investment is in Larky, an Ann Arbor-based mobile app startup that just closed a $1.76 million Series A round.

"We will probably have a portfolio of 9-10 companies (by the end of the year)," Simms says.

Source: Skip Simms, manager of the Michigan Angel Fund and senior vice president of Ann Arbor SPARK
Writer: Jon Zemke

Read more about Metro Detroit's growing entrepreneurial ecosystem at SEMichiganStartup.com.

MuniRent gains tractions, wins spot in Code for America

MuniRent, the startup that enables municipalities to share heavy equipment, has been gaining traction with some local governments in its first year, but it's finding a lot of easy target clients in Oregon.

MuniRent has landed the cities of Chelsea and Milan as clients and is in the process of signing up Washtenaw County, Ypsilanti, and a handful of municipalities in Macomb and Oakland counties. However, it's starting to appear that the startup's easiest opportunities are in the northwestern section of the U.S.

"There is a lot of action in Michigan but the biggest concentration (of municipalities open to MuniRent's idea of sharing heavy equipment) is in Oregon," says Alan Mond, co-founder of MuniRent. "Oregon has been doing this since 1995 but they were using Excel spreadsheets."

MuniRent launched out of 1000 Tools last year, which is based in the sharing economy where people who own expensive or niche tools can put them up as rentable online. MuniRent is now 1000 Tools primary product, enabling local municipalities to put their heavy or niche equipment up for rent to other nearby municipalities.

The three-person startup has spent its first year getting the company established in Metro Detroit, and it also got tipped off to Oregon's affinity for the idea recently. MuniRent also won a place in Code for America’s 2014 accelerator class. About 120 companies applied to take part in the four-month-long program, which takes place in San Francisco, and MuniRent was one of five (and the only one from the Midwest) to make the cut.

"We were pretty flattered to be selected," Mond says. "It's a pretty big deal. They are a growing force in the government tech space."

Source: Alan Mond, co-founder of MuniRent
Writer: Jon Zemke

Read more about Metro Detroit's growing entrepreneurial ecosystem at SEMichiganStartup.com.

Ann Arbor-based AdAdapted raises $725,000 in seed round

AdAdapted has locked down $725,000 in seed capital to help it scale up its mobile advertising platform.

Among the investors were the University of Michigan’s Zell Lurie Commercialization Fund, Belle Michigan, and Start Garden. The Ann Arbor-based startup plans to initially use part of the money to accelerate its hiring. The 2-year-old company currently employs six people after hiring three over the last year. It's currently looking to hire a software developer and sales professional. After that much of the money will be used to help get the word out about AdAdapted.

"We'll mostly be using it on sales and marketing after that," says Molly McFarland, co-founder & chief marketing officer of AdAdapted.

The startup's advertising platform connects advertisers with developers to create customized native ads in mobile apps. It strives to provide a simple interface so advertisers can find their best  audience. The idea is to do away with intrusive banner ads by replacing them with slicker native ads.

"We have clients right now," McFarland says. "The technology is up and running."

AdAdapted's technology is being used by some advertisers. The startup's staff is currently working to flesh out the platform and expand its client base.

Source: Molly McFarland, co-founder & chief marketing officer of AdAdapted
Writer: Jon Zemke

Read more about Metro Detroit's growing entrepreneurial ecosystem at SEMichiganStartup.com.

Ornicept shifts into sales mode, plans to close on Series A

Ornicept has a new brand for its product, a few new customers, and is making way to raise even more money later this year.

The downtown Ann Arbor-based startup has rebranded its field data collection software (formerly called GeoTraverse) to Specteo. It has gone beyond its Beta launch and started lining up customers as it fleshes out its mobile platform.

"We have been hitting sales mode pretty quickly and heavily," says Justin Otani, co-founder of Ornicept. "We also have been adding features and improving functionality."

Otani co-founded Ornicept with Russell Conard two years ago, originally developing bird monitoring technology for airports and wind farms. Last year it pivoted to creating a mobile software platform that helps researchers and inspectors collect data in the field. It started on Andriod tablets and is expanding beyond that.
 
"We have an iOS version coming out later this year," Conard says.

Ornicept raised a $600,000 angel round last year that helped get its product to market. It is aiming to raise a Series A round of investment later this year. The company has hired four people over the last year (two marketing professionals and another two sales professionals), expanding its staff to 14 people.

Source: Justin Otani and Russell Conard, co-founders of Ornicept
Writer: Jon Zemke

Read more about Metro Detroit's growing entrepreneurial ecosystem at SEMichiganStartup.com.

Movellus Circuits launches fresh microprocessor technology

A lot of startups struggle to raise money to build prototypes of their technology. Movellus Circuits is flipping the script: it already has its prototypes in hand before any money has been raised.

"We have four working prototypes that prove the technology works," says Muhammad Faisal, CEO of Movellus Circuits.

Faisal graduated from the University of Michigan in April with a PhD in electrical engineering. He is commercializing his research at the university. That technology is a patent-pending clock generator for the microprocessor market. The 1-year-old startup is working to make sure its generators are quicker to design, smaller than competitors, offer higher performance, use lower power, provide more flexible, and while only being for sale at a fraction of the cost of existing solutions.

Movellus Circuits is currently working to line up its first customer to license the technology to. It is also looking at establishing a strategic partnership while gearing up to raise a seed capital round of $1 million later this fall.

"That will give us 18 months of runway," Faisal says.

Source: Muhammad Faisal, CEO of Movellus Circuits
Writer: Jon Zemke

Read more about Metro Detroit's growing entrepreneurial ecosystem at SEMichiganStartup.com.

North Coast Banners eliminates debt to grow business

Many growing companies actively work to increase their debt load in order to expand their business. North Coast Banners works to eliminate its debt load to grow.

The Ann Arbor-based company has spent the last few years focused on eliminating its debt, while enjoying steady growth. It routinely aims for 10 percent revenue growth while making sure it owes as little to other people as possible.

"We have paid down every single nickel of corporate debt," says David A. Abramson, managing partner of North Coast Banners. "This is why we're here and a lot of people aren't."

He adds his company was inspired by Dave Ramsey, a financial author and radio host, and his emphasis on being debt free. That has allowed North Coast Banners to grow its staff to six employees and the occasional intern. It hired its last intern as a graphic designer, and it plans to hire another 1-2 people over the next year.

North Coast Banners has also added new work by making banners for concerts, festivals and events. Abramson says if you watch a local band in concert these days there is a good chance the banner hanging over it was made by North Coast Banners. That has allowed the company to add $250,000 in gross revenue and spike its revenue beyond the $1 million mark. Abramson credits that growth to the new business and his firm’s continued focus on remaining debt free.

"I'm really convinced it's the missing link in a lot of our businesses," Abramson says.

Source: David A. Abramson, managing partner of North Coast Banners
Writer: Jon Zemke

Read more about Metro Detroit's growing entrepreneurial ecosystem at SEMichiganStartup.com.

Huron Valley Financial hires 12 as it eyes expansion

Huron Valley Financial has spent much of its first 17 years establishing its mortgage services in Michigan.

Today the Ann Arbor-based company has eight branches in Michigan, employing 75 people. That's after it opened two new branches in Clarkston and Kalamazoo over the last year, prompting it to hire a additional dozen people. Those new hires are mostly of loan officers and customer support professionals.

Now Huron Valley Financial is eyeing a bigger expansion across the U.S. this year. Indiana, Texas and Florida have licensed Huron Valley Financial to originate mortgages, and a few more states are in the works.

"We have Ohio and California in the works right now," says Casey Daniels, vice president of business development for Huron Valley Financial. "Our California application could be approved any day now."

Huron Valley Financial is working to expand to southern statements to help smooth out its business model. Its revenue usually spikes in the warmer months in the Midwest to correspond with housing sales. Warmer climates in southern states means a steadier sales volume, which creates a smoother revenue stream for Huron Valley Financial.

"We would like to be able to tap into the warmer states for when it gets cold up here," Daniels says.

Huron Valley Financial has continued to grow as the mortgage industry has shrunken over the last year, primarily thanks to rising interest rates and falling refinancing sales. Despite this, Huron Valley Financial kept on growing while other lenders were laying people off.

"We never grew too big too fast, even during the good times," Daniels says. He adds, "We haven't gone through any layoffs because we have a great business model."

Source: Casey Daniels, vice president of business development for Huron Valley Financial
Writer: Jon Zemke

Read more about Metro Detroit's growing entrepreneurial ecosystem at SEMichiganStartup.com.

Accent Reduction Institute spins out Accents International

Judy Ravin and Barb Niemann are in the middle of a big shake up at the Accent Reduction Institute.

First off, it's not just the Accent Reduction Institute anymore. The Ann Arbor-based company is now working closely with Accents International, which spun out of Accent Reduction Institute three months ago.

The 8-year-old company made a name for itself providing accent reduction training programs. Those programs gave non-native English speakers the tools to communicate seamlessly. Think of software that helps people with English pronunciation.

"I felt that Accent Reduction Institute was up and running and doing great," Ravin says. "This year we converted all of our learning material to online and hosted in the cloud. It was a big milestone for us."

Today Accent Reduction Institute focuses on licensing those programs out to corporations and large institutions looking to help their employees overcome language barriers. It's primarily a product company.

Ravin, who is still a board member at Accent Reduction Institute, and Niemann launched Accents International to handle the service end of the business. The LLC focuses on providing educational training to people who speak English as a second language and want to do so with ease and clarity.

"We really missed the teaching side of this," Ravin says. "There is nothing more gratifying than working with people and helping them clarify their professional expertise."

Source: Judy Ravin, co-founder of Accents International
Writer: Jon Zemke

Read more about Metro Detroit's growing entrepreneurial ecosystem at SEMichiganStartup.com.

Selocial bridges photos, music, and social media

Music, photos, and social media are three of the hottest trends in tech today. Lots of startups make their way specializing in one of those things. Selocial is making a name for itself by connecting all three.

The Ann Arbor-based startup likens itself to when Instagram meets Spotify or Pandora. The 1-year-old company’s software allows users to make a "Selomix," which is a 15-minute visual playlist that combines the users preferred music with a photo.

"When any song is played on Selocial instant news about that artist is activated," says David Baird, co-founder & CEO of Selocial. "It's a more social experience than Instagram or Pandora."

Baird considers himself an artist with published work as a songwriter and author. His songs have appeared in the movie "White Chicks" and TV show "House of Lies" on Showtime. His career over the last 15 years led him to believe that there had to be a better way for independent artists to attract attention, which served as the inspiration for Selocial.

"I thought artists weren’t being discovered the way they should be," Baird says. "How can I help artists like myself get discovered?"

Selocial launched the public Beta version of its platform in May. The team of six behind the startup is working to grow its user base to 5,000 to 10,000 people by the end of the summer. In the mean time, the Selocial team is working to better link user accounts and introduce real-time chat.

"We want to improve our sharing," Baird says.

Source: David Baird, co-founder & CEO of Selocial
Writer: Jon Zemke

Read more about Metro Detroit's growing entrepreneurial ecosystem at SEMichiganStartup.com.

Internet2 adds staff as it expands higher-ed tech offerings

New technology agreements and a few new hires are on the radar for Internet2. The Ann Arbor-based, member-owned technology community is signing new agreements to increase technology sharing between universities and hiring a handful of people in Tree Town.

Internet2 is working on a special offering that could bring Amazon Web Services to its membership, a collaborative of U.S. research and education organizations. The deal is in process and could come to fruition as soon as this summer.

"Amazon Web Services are highly desired by higher education," says Todd Sedmak, PR & media relations manager with Internet2. "It's one of the most robust platforms to help our researchers."

Internet2 also launched the Unizin consortium, earlier this month with the University of Michigan serving as one of the co-founding partners. The four co-founding universities will provide a common technological platform, overseen by Internet2, that allows members to work locally and strengthen their traditional mission of education and research while using the most innovative digital technology available.

"They can leverage that for digital learning on their campus and the campuses that are participating," Sedmak says. He adds, "It all stays within the academic community."

Internet2 recently hired an associate vice president of community engagement in Ann Arbor. It also has three open positions for associate program managers and a community engagement manager. You can find those openings here, here and here.

Source: Todd Sedmak, PR & media relations manager with Internet2
Writer: Jon Zemke

Read more about Metro Detroit's growing entrepreneurial ecosystem at SEMichiganStartup.com.

LLamasoft growth spurt includes 35 hires in 2014

The LLamasoft growth streak continues to spike unabated as the downtown Ann Arbor-based firm expands its footprint around the world.

The logistics firm spent its first decade establishing its software in the logistics marketplace, building up a customer base of bigger and bigger firms. LLamasoft landed $6 million in a Series A round of venture capital investment and has leveraged that to scale its business.

"We have had some really significant growth," says Ginger Stegmier, vice president of marketing for LLamasoft. "We increased our revenue by 80 percent over the last year."

And it has been adding staff, hiring 35 people since the start of this year. It now employs about 150 people in the U.S. and close to 200 people worldwide. After relying on a London office for European growth, LLamasoft has opened satellite in both France and Germany over the last year, and plans to keep expanding its presence in a similar fashion around the world.

It's all part of plan to keep doing all of the little things in its business plan to keep growing the company. LLamasoft has expanded its sales and marketing teams to better brand itself. It has also worked to make its logistics software more accessible to customers.

"It's not one thing we have done," Stegmier says. "It's a variety of things we have done to grow."

LLamasoft is also hosting its fourth annual logistics/supply chain design conference (SummerCon) in Ann Arbor next week. The conference, which features a keynote address by Bill Nye the Science guy, has attracted participants from more than 20 countries and some big names in U.S. logistics, including the senior vice president of logistics for Pepsi.

"We have a lot of industry heavy hitters participating this year, and a lot of local companies," Stegmier says. "We're pretty excited about that."

Source: Ginger Stegmier, vice president of marketing for LLamasoft
Writer: Jon Zemke

Read more about Metro Detroit's growing entrepreneurial ecosystem at SEMichiganStartup.com.

Jolly Pumpkin fills out new production space in Dexter

Jolly Pumpkin Artisan Ales moved into a bigger production facility a little more than a year ago, and that investments is starting to pay off for the Dexter-based craft brewery.

Jolly Pumpkin Artisan Ales doubled its sales last year when production could catchup with demand. Its revenue and production are trending higher again this year, as the brewery continues to up its production. It produced about 4,000 barrels of its brews last year, and another 5,000 barrels of North Peak Brewing Co's beers, to which Jolly Pumpkin Artisan Ales bought the distributions rights.

"This new facility is five times that size," says Ron Jeffries, founder of Jolly Pumpkin Artisan Ales. "We have lots of room to expand."

That includes another five acres of land adjacent to the brewery. That is enough space for Jolly Pumpkin to triple its current production. That has also meant more jobs. The craft brewery has hired five people at its production facility, which now has a staff of 15 people, over the last year.

"We're constantly adding people," Jeffries says. "We just added two people over the last two weeks."

Jolly Pumpkin Artisan Ales is also at full employment at its two restaurants in downtown Ann Arbor and Traverse City. That means 200 people working between the two locations. Jeffries adds that his company is looking at adding a third restaurant in the near future. It’s also looking to bump up its production to 10,000 barrels of beer next year and 15,000 barrels of booze by 2015.

Source: Ron Jeffries, founder of Jolly Pumpkin Artisan Ales
Writer: Jon Zemke

Read more about Metro Detroit's growing entrepreneurial ecosystem at SEMichiganStartup.com.

HistoSonics adds 3 staff as it continues clinical trial

Clinical trials and venture capital. Those are major milestones the team at HistoSonics is working to hit before the end of this year.

The Ann Arbor-based life sciences startup is aiming to finish raising a Series B round of venture capital and finish its first clinical trial by the end of this year.

"Those are our two biggies," says Christine Gibbons, president & CEO of HistoSonics.

HistoSonics spun out of the University of Michigan four years ago. It's primary product is a medical device that uses tightly focused ultrasound pulses to treat prostate disease in a non-invasive manner with robotic precision. The technology helped inspire the company's name by combining histo (meaning tissue) and sonics (meaning sound waves).

HistoSonics has a team of 11 people after adding three new researchers over the last year. It is currently working on a completing a clinical study measuring the safety of their product. The startup is aiming to submit its technology to the FDA for approval in 2016.

HistoSonics also raised $11 million in Series A funding in 2009. It is seeking another $12 million to $15 million in a Series B round this year.

"We have gotten some interim funding from our investors so we haven't had to raise a Series B yet," Gibbons says. "We want to get that wrapped up by early fall."

Source: Christine Gibbons, president & CEO of HistoSonics
Writer: Jon Zemke

Read more about Metro Detroit's growing entrepreneurial ecosystem at SEMichiganStartup.com.

DavaRay leans on Ann Arbor SPARK as it scales up

DavaRay is getting more than a little bit of help from its friends these days as the medical device startup taps into local entrepreneurial resources to grow.

"We have been focusing on utilizing the MEDC groups, like Ann Arbor SPARK," says David Arndt, co-founder of DavaRay.

DavaRay has an office at Ann Arbor SPARK’s Central Incubator in downtown Ann Arbor. The 7-year-old company also graduated from Ann Arbor SPARK's Entrepreneur Boot Camp and is leveraging the coaching resources at the business accelerator. That has allowed DavaRay to nearly triple is sales over the last year and add two people to its current team of 25. It's also looking to export its products overseas in earnest later this year.

DavaRay's principal product is the Nanobeam 940, a proprietary heat dissipation technology that uses light to stimulate the healing process. Specifically its monochromatic LED ray helps soothe chronic pain.

Arndt and his co-founder, David Anderson, launched the business not long after Arndt created a new way to help him cope with chronic back pay. He found relieve in infrared therapy and started making his own products after the company he was using went out of business.

Nanobeam 940 is being used in home healthcare and professional sports team, including by the Detroit Tigers. Check out a video of the Tigers Athletic Trainer talking about the Nanobeam 940 here.

Source: David Arndt, co-founder of DavaRay
Writer: Jon Zemke

Read more about Metro Detroit's growing entrepreneurial ecosystem at SEMichiganStartup.com.

FlockTAG sticks to growth plan as it expands across Midwest

FlockTAG, the consumer loyalty startup, is starting to scale it business model across the Midwest this year.

The 2-year-old startup is working to reinvent the customer loyalty programs with creating one centralizes card users can use at a number of different retailers. That way technology can keep tabs on the loyalty rewards the user accumulates at local businesses without them carrying around a different card for each business.

FlockTAG has grown into seven markets across the Midwest, including Columbus, Indianapolis and Champaign. It is working to expand into more metro areas this year, focusing on high-volume retail locations, such as coffee shops.

"We're doing our plan," says David Lin, co-founder & CEO of FlockTAG. "We're growing these direct sales and relationships with franchise groups."

FlockTAG has grown its average transactions per day at a location to 30. It’s users per location is now up to 1,100. Both numbers are up 20 percent over the last year.

"We have several locations where there are more than 200 transactions per day," Lin says.

Lin adds that FlockTAG has been able to drive up those numbers because his team (which stands at 15 people after making seven hires over the last year) has gotten better at its job. Specifically helping keep new stores using the FlockTAG software.

"It's about helping the vendors when they need it," Lin says. "When you bring on a vendor you need to help them so they understand the platform."

Source: David Lin, co-founder & CEO of FlockTAG
Writer: Jon Zemke

Read more about Metro Detroit's growing entrepreneurial ecosystem at SEMichiganStartup.com.
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