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Grand Angels expand investment reach into Ann Arbor

Grand Angels has been spreading its wings across Michigan, making investments across the Great Lakes State including in Ann Arbor.

That's a significant step for the Grand Rapids-based angel investment group. Angel investors are high-net-worth individuals (think millionaires) who invest in early stage startups. The Grand Angels started a decade ago with the idea of investing in those startups in the Grand Rapids area. It quickly realized that opening up that area meant more opportunities to invest.

"We said we will look at deals anywhere in Michigan as long as it looks like a good deal," says Jody Vanderwel, president of Grand Angels. "That opened up the pipeline quite a bit."

One of those deals is in Local Orbit. The Ann Arbor-based startup is developing software that helps connect food producers (think farmers, co-ops and farmers markets) with grocers, restaurants and other eateries.

Local Orbit's online marketplaces are active across a dozen states. That enabled local farmers' sales through Local Orbit to grown 300 percent between 2012 to 2013. Local Orbit is leveraging its investment from Grand Angels to expand its targeted regions.

Source: Jody Vanderwel, president of Grand Angels
Writer: Jon Zemke

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

Michigan Business Challenge sends 113K to student startups

A wide variety of student-led startups scored thousands of dollars in seed capital at the most-recent Michigan Business Challenge.

The annual business-plan competition at the University of Michigan awarded $113,000 from the Michigan Business Challenge and Dare to Dream grant program. The competition awarded money to 16 teams that ranged from $200 to teams that made it past round one to $20,000 for the top placer. Among the winners were clock generator technology for the microprocessor market and a workout water bottle that can be turned inside out so it can be washed.

"When you have that kind of diversity of really smart people all in one place it is unusual if you don’t see that sort of breadth of diversity when these competitions come up," says Stewart Thornhill, executive director of the Zell-Lurie Institute for Entrepreneurial Studies, which organized the competition.

Among the top winners are:

Movellus Circuits won the Pryor-Hale Award for Best Business (worth $20,000) for its patent-pending clock generator technology for the microprocessor market.

Flipsi won the Pryor-Hale runner-up award for best business ($10,000) and the marketing award ($2,500). Flipsi is creating a reusable drinking bottle that flips completely inside out to facilitate easier cleaning.

A group of three U-M graduate students studying engineering ands business won the Erb Institute award for Sustainability ($7,500). The trio is developing an energy system that installs heavy-duty power electronics and battery storage units in commercial buildings for fast-charging services to electric vehicle drivers.

MyDermPortal won the Outstanding Presentation award ($2,000) and the Marketing award ($2,500) for its web-based app for dermatologists to provide follow-up treatment via the Internet for the most common diagnoses in significantly less time than an in-person visit.

Lab Compass won the Most Successful Undergraduate Team award ($2,500) for its cloud-based software enabling more efficient collection, storage and sharing of sensitive healthcare data used in medical research.

Nodify won the Best Written Plan award ($2,000) for its mobile apps that automatically refine a user’s professional network into a manageable group of important contacts and suggests relevant reasons to stay in touch.

"The ones that did emerge at the tip of the heap are the one that showed the most promise," Thornhill says.

Source: Stewart Thornhill, executive director of the Zell-Lurie Institute for Entrepreneurial Studies
Writer: Jon Zemke

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

Seelio continues to expand software platform across U.S.

Seelio is starting to grow beyond its humble beginnings in Ann Arbor. The software startup's digital portfolio platform for college students is appearing at more and more universities across the U.S.

Seelio is developing a software platform that allows college students to showcase their portfolio of work. The software enables the students to document how college projects came to fruition and use that to get a start in the professional world, such as for job interviews. Seelio’s software is actively being used at seven universities across the U.S., including the universities of Michigan, Toledo and Texas, among others.

"We have a very strong pipeline of universities," says Moses Lee, CEO of Seelio.

That growth has allowed Seelio to grow in a number of different ways. It raised a $1.5 million seed round last year. It also hired six people (mostly in sales and customer service), expanding its staff to 12 employees. It also moved to new space at Ann Arbor SPARK’s Central Business Incubator in downtown Ann Arbor.

Seelio is looking to continue to grow its product use in more universities across North America. It currently has string footholds in the Midwest, East Coast and South, but would like to partner with more institutions of higher learning in other regions of the country in 2014.

"It's all about growth," Lee says. "We want to provide stellar outcomes and services to university students."

Source: Moses Lee, CEO of Seelio
Writer: Jon Zemke

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

G2 Consulting Group plans to open up office in Ann Arbor

G2 Consulting Group is opening up a new office in Ann Arbor, which is bringing a handful of new hires to Tree Town.

The Troy-based firm provides environmental and geotechnical engineering services in the construction industry. It has an office in Chicago and is opening up the new office in Ann Arbor to accommodate its double-digit revenue growth. The new office has a staff of six people and ambitions to grow further.

"We are going to hire a couple more people for that office," says Noel Hargrave, co-founder & principal of G2 Consulting Group. He adds there are two engineering jobs currently open.

The 20-year-old firm has experienced significant growth in the last two year, spiking its revenues by 20 percent in 2012 and 31 percent last year. Part of that expanded work comes from the University of Michigan and Washtenaw County. G2 Consulting Group is opening a lab for soils and materials work in its Ann Arbor office to accommodate that work.

G2 Consulting Group does work across the U.S., operating in 29 states. Hargrave says the business has grown with the upswing in economy because it’s true to its word when it’s time to deliver.

"We do what we say we're going to do and we do it on a timely basis," Hargrave says. "In construction you can't be the person holding up the project."

Source: Noel Hargrave, co-founder & principal of G2 Consulting Group
Writer: Jon Zemke

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

Qstride expands into Ann Arbor with downtown space

Qstride is expanding its physical presence across the U.S. and the Troy-based firm has its eyes on Ann Arbor.

The software company, which already has a growing office in downtown Detroit, is opening a another office in downtown Ann Arbor and Virginia this winter. The Ann Arbor office has one person right now, but the leadership at Qstride expects that head count to grow.

"We have local people in these locations," says Shane Gianino, CEO of Qstride. "These are hotbeds for new technology."

The 20-month-old firm specializes in analytics and business intelligence software. Qstride has watched its revenue jump 135 percent over the last year, allowing it to expand its staff to 22 people. It has clients across the U.S. including in New York, California, Arizona and Ohio.

Gianino says there are a couple of reasons why Qstride choose Ann Arbor for its newest location. The biggest reason is its proximity to the University of Michigan.

"There is a lot of talent at the University of Michigan," Gianino says. "We need software engineers. Our lead data scientists is out of Ann Arbor and is in charge of that office."

Source: Shane Gianino, CEO of Qstride
Writer: Jon Zemke

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

U-M students create new mobile startup, Tag Contacts

What do you do when you want to launch a new economy startup? Find a new economy pain in the butt and begin working on a solution. It also helps if you can have a tech titan give you a shout out to get things started.

That's what's going on with Tag Contacts. The startup is the brainchild of two University of Michigan undergrads who want to build a better contacts apps for smartphones. The startup also managed to get a bump in interest when Twitter CEO Dick Costolo took notice of Tag Contacts and told the world.

"We're trying to go back to basics," says Chris O'Neil, co-founder of Tag Contacts. "Tag is for play tag on the playground. We’re trying to make it as simple as possible."

O'Neil, who is also president of MPowered, and Billy Irwin are juniors at U-M studying computer science. They became frustrated with a million and one annoyances with traditional contact lists on their smartphones, so they started reinventing the technology. That meant launching Tag Contacts, which is now composed of a team of five people, last October.

Tag Contacts technology, which is in private Beta, aims to make using the contacts list on a smartphone simpler and more intuitive. For instance, it allows users to sort contacts by which ones were recently entered. It also differentiates between contacts found on social media and in real life.

"The people you call and text aren’t necessarily the people you interact with on social media," O'Neil says. "We want to get you through to the people you want to call."

Tag Contacts caught Costolo's eye last week. The Twitter CEO, also a U-M alum, began following Tag Contacts and tweeted the startup, which brought about a world of attention. The startup is now pulling allnighters to get its technology into Apple's App Store by March.

Source: Chris O'Neil, co-founder of Tag Contacts
Writer: Jon Zemke

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

U-M startup takes top prize at Michigan Collegiate Innovation Prize

GENOMENON, a startup founded by University of Michigan students, walked away with the top prize at the Michigan Collegiate Innovation Prize last week. The win allows the healthcare software startup to pocket $40,000 in seed capital.

GENOMENON's technology is the product of three U-M pathologists. The trio is developing software focused on improving cancer diagnosis and treatment. The company won the top prize at the event and the competition’s health category.

This is the fifth year for the competition, which has changed names and pivoted its focus a couple of times. The Michigan Collegiate Innovation Prize is a three-month program that helps innovators find the market for their products. It is organized by U-M's Center for Entrepreneurship and offers $100,000 in seed capital for student-led startups.

Startups from across Michigan’s colleges are eligible to compete. This year it fielded 81 student teams from 16 colleges. Twenty three of those teams made the semifinals and five of those teams walked away with seed capital prizes.

"It's about talent retention through Michigan-based ventures," says Amy Klinke, associate director at University of Michigan’s Center for Entrepreneurship. "For us it's a win that these students stay in the state to lead these ventures."

The Michigan Collegiate Innovation Prize got its start as a business plan competition at the University of Michigan. It then pivoted to become the Michigan Clean Energy Competition and expanded its reach to include participants from across the Great Lakes State. This year it opened up the competition even further to invite participants from a number of different new economy sectors, such as software.

Source: Amy Klinke, associate director at University of Michigan’s Center for Entrepreneurship
Writer: Jon Zemke

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

Thomson-Shore acquires PublishNext, Seattle Book Co

Thomson-Shore has acquired PublishNext and its subsidiary Seattle Book Company in an effort for the Dexter-based firm to broaden its publishing platform.

"It is something we have been wanting to do for sometime now," says Kevin Spall, president of Thomson-Shore.

The 40-year-old company, which is 100-percent employee owned, operates as a full-service book publishing, production, and distribution company. It employs 200 people and a couple of summer interns. The firm has hired 10 people (mainly in production and manufacturing) over the last year. It is also looking to hire two more people in sales and customer service.

PublishNext enables authors or small publishing houses to print their tomes or create an eBook. The Seattle Book Company has distribution channels in new markets that Thomson-Shore desires. Thomson-Shore’s acquired the two entities so it can create a broader publishing and distribution platform that allows it to fill the gaps it has with its customers.

"It was a really good fit from a market-fit and customer-service standpoint," Spall says.

He adds that Thomson-Shore has been looking to make an acquisition like this for the last 18 months and passed on a few other opportunities because they didn't fit Thomson-Shore's goals of supplying high-quality products and services.

Source: Kevin Spall, president of Thomson-Shore
Writer: Jon Zemke

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

ArborMetrix nails down an extra $1.3M in VC funding

ArborMetrix has expanded its Series B funding, adding $1.3 million in seed money from a couple of local venture capital firms. The Renaissance Venture Capital Fund and Detroit Innovate contributed to the Series B round, which was closed last year and led by RPM Ventures.

"They basically topped off that Series B," says Brett Furst, CEO of ArborMetrix. "It brought the Series B to $8.3 million."

The healthcare software startup moved into a new 9,000-square-foot office in downtown Ann Arbor, across the street from Google’s office, in November. "We take up most of the second floor," Furst says.

ArborMetrix's software platform provides real-time clinical performance analytics tools for hospitals. The technology helps healthcare providers improve the quality, safety and cost-effectiveness of surgical and other specialty care. ArborMetrix currently employs 31 people, up from 16 about a year ago, who are working to boost sales and flesh out the software platform.

"Our business plan shows we will be at 46 to 47 people by the end of the year," Furst says.

The $8.3 million Series B will help fund the development of the second generation of ArborMetrix's software platform, along with its sales and marketing efforts. Furst expects the platform to be released later this year. The increased size of the Series B might mean the startup doesn’t have to raise a Series C round anytime soon, if ever. It also means it can focus on the continued growth of its venture and the local investors who supported it.

"We want to hire and grow here," Furst says.

Source: Brett Furst, CEO of ArborMetrix
Writer: Jon Zemke

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

Ann Arbor's stkr.it adds 2 jobs after locking down Series A financing

Ann Arbor-based stkr.it may be about to turn three years old, but most of its growth took place over the last year.

The software startup helps people create and connect new messages to items like greeting cards and scrapbooks. The company has landed a number of partnerships with larger companies that will utilize its technology. Some of those partnerships include deals with Epson (a printer company) and Walsworth Publishing (a yearbook firm).

"It has been gratifying to see all of these partnerships come about," says Mike Newman, president of stkr.it. "As these products hit the market we expect to see a dramatic level of growth in the next six months."

The startup, which has dual offices in Ann Arbor and New York City, also locked down a Series A round of seed capital worth $600,000. That has allowed it make two of its part-time employees full-timers, rounding out its staff to five people. It is also looking at adding interns this year. Newman hopes to leverage a growing staff and revenues to flesh out its product in 2014.

"Now that we have built up a user base we want to give them the best product we can," Newman says.

Source: Mike Newman, president of stkr.it
Writer: Jon Zemke

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

Michigan eLab's portfolio company looks to open Ann Arbor office

Venture capital firm Michigan eLab made its first investment in a startup last year, and it’s now helping that company establish a presence in Ann Arbor.

Fonemine is headquartered in Silicon Valley. The software startup scored an investment from Michigan eLab last fall and is working to open a sales office in Ann Arbor.

"They have already hired one sales rep in Ann Arbor," says Doug Neal, co-founder of Michigan eLab. “They are partnering with (Detroit-based) VisionIT.”

Michigan eLab launched about a year ago with the idea of funding startups in Michigan and bridging the gap between tech super hubs like Silicon Valley and the Great Lakes State. The firm has five partners, one administrative staffer and an intern. That team has raised almost half of its first fund, which has a goal of $40 million, and hopes to finish fundraising before the end of the year.

Michigan eLab specializes in investing in early-stage tech startups. Its average investment is $1 million. Neal hopes to close on two more investments in the near term, including one with an Ann Arbor-based startup.

"The pipeline is great," Neal says. "It's amazing how many opportunities we are seeing."

Source: Doug Neal, co-founder of Michigan eLab
Writer: Jon Zemke

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

Renaissance Venture Capital Fund begins investing in startups

The Renaissance Venture Capital Fund made its name as a fund of funds in the venture capital world, making sizable investments in smaller venture capital firms either based in Michigan or establishing a presence in the Great Lakes State. Now the fund is starting to make headlines for investing directly into startups.

The Renaissance Venture Capital Fund, which has its offices in both Detroit and Ann Arbor's downtowns, has made three direct investments in maturing startups that are backed by its own fund of funds. Those investments, all made in 2013, have a Michigan focus and more are in the pipeline.

"Those funds (that the Renaissance Venture Capital Fund backs) tend to invest in early-stage companies," says Chris Rizik, CEO of the Renaissance Venture Capital Fund. "We have been monitoring them as they grow. Three of them reached a level of maturity that we could invest in them in 2013."

That level was the $8.3 million Series B round invested in ArborMetrix late last year. It also includes venture capital rounds for Fidelis SeniorCare and Swift Biosciences. Those investments range between $500,000 and $750,000 per startup.

"You will probably continue to see 1-2 direct investments per year for the foreseeable future," Rizik says.

The Renaissance Venture Capital Fund has made 14 investments since its launch a few years ago, and is preparing to announce its 15th investment in a couple of weeks. It has committed $60 million of its initial $100 million fund. The fund is primarily capitalized by Fortune 1000 firms based in Michigan.

Source: Chris Rizik, CEO of the Renaissance Venture Capital Fund
Writer: Jon Zemke

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

Kalyspo aims to commercialize technology by year-end

Kalyspo, the bio-tech startup and University of Michigan spin out, is well on its way to commercializing its surgical instrument tracking technology.

The Ann Arbor-based company’s technology helps prevent medical professionals from leaving foreign objects (think surgical tools like sponges) in patients during an operation. It accomplishes this by inserting a micro-machined tag that shows up clearly on x-rays and computer software. The technology is so advanced that it scores highly on both the sensitivity and specificity scales for finding these sorts of items.

"This is one of the best (detection rates) I have ever seen," says Dr. Theodore Marentis, co-founder of Kalyspo.

The 1-year-old startup employs a team of four employees, two interns and two independent contractors. It also won the Best of Boot Camp award at the Ann Arbor SPARK Entrepreneur Boot Camp.

Dr. Marentis expects to commercialize this technology before the end of the year. He says the company is in discussion with a couple of hospitals which could become potential customers, and it is looking to create other types of revenue streams.

"We're talking to a number of manufacturers about adding them to their product line," he says.

Source: Dr. Theodore Marentis, co-founder of Kalyspo
Writer: Jon Zemke

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

TLS Productions moves to new Ann Arbor location

TLS Productions has moved from Brighton to Ann Arbor, bringing 14 more jobs closer to the Washtenaw County seat.

The 60-year-old firm specializes in providing sales, rental, and production for the stage part of special events. For instance, it provides the lighting for everything from theater productions to automotive and trade shows. It employs 20 people in total, and is also looking to hire two more people.

"Ann Arbor is a fantastic hiring base," says Carl Kedzierski, director of marketing and new business development for TLS Productions. "We're hoping to get somebody local."

TLS Productions' new space in Ann Arbor is twice as big as its previous one in Brighton. It began the move in November and finished just before the end of last year.

"It took quite a while," Kedzierski says. "It was quite a production for us."

Source: Carl Kedzierski, director of marketing and new business development for TLS Productions
Writer: Jon Zemke

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

Trilogy Health Ventures expands with 60 new hires

Trilogy Health Ventures launched businesses in three areas in the last few years, expanding into pharmaceutical research, consulting and home healthcare. The Ann Arbor-based firm’s investment in latter of those sectors is paying off the most.

Trilogy Health Ventures owns three home healthcare businesses that provide home healthcare for senior citizens and other people in need across Michigan. Trilogy Ventures North handles cities like Bay City, Mt. Pleasant and Flint. Trilogy Ventures South covers Ann Arbor and Jackson. Trilogy Ventures West overseas Grand Rapids Kalamazoo and Hastings.

"These are really driving the hiring of new employees," says Barry Paxton, managing partner of Trilogy Health Ventures. "We have just been growing like crazy in the senior-care space. We're looking at subsequent investments in the business."

Those three businesses have hired 60 people over the last year, mostly nursing assistants and other types of home healthcare workers. Paxton expects to double that head-count over the next year.

Trilogy Health Ventures employs 70 people through all five of its businesses. It has two other businesses not associated with home healthcare. Pharma Form Solutions specializes in contract pharmaceutical research but has experienced flat revenues while hunting for new work. Paxton Holdings, a pharmaceutical consulting service, has experienced modest growth over the last year.

"It's a consistent revenue stream," Paxton says. "It's been going quite well."

Source: Barry Paxton, managing partner of Trilogy Health Ventures
Writer: Jon Zemke

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