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MSU Foundation receives additional funding from Michigan Strategic Fund for Pre-Seed III Fund to continue supporting early-stage tech companies
LANSING, Mich. – The Michigan Strategic Fund has approved a grant amendment in the amount of $6.5 million for Michigan State University Foundation to support high-tech Michigan start-up companies and innovative technologies at the university level through the Pre-Seed III Fund, the Michigan Economic Development Corporation announced today.
The purpose of the Pre-Seed Fund is to provide early-stage funding to help Michigan high-tech startups gain greater access to support for technologies to reach the commercial market. The Fund provides loan and equity financing investments to companies that may be unable to access funding through venture capital firms or traditional financing. The Pre-Seed III Fund is administered by MSU Foundation through Michigan Rise, a wholly-owned subsidiary of the Foundation.
“Michigan Rise’s mission, track record, and relationships across the state make for a compelling story, and we’re excited to work with a team so committed to this important work,” said Fred Molnar, vice president of Entrepreneurship & Innovation at the MEDC. “The success of the Pre-Seed III Fund, through MSU Foundation’s leadership and expertise, is critical in terms of the return on investment it has generated from the companies it has supported.”
In April 2020, the MSF board approved $3 million in Pre-Seed III funds to be administered by Michigan State University Foundation to better support entrepreneurs and tech startups across Michigan. This funding was intended to support MSU Foundation in engaging with pre-seed stage companies by providing capital support, coaching, assistance with grant funding and more. The award of the Pre-Seed Fund was especially critical at the time, considering the impact that the COVID-19 pandemic was having on Michigan’s early-stage tech companies. The fund was vital in providing the best support possible to early-stage technology companies to help put them on a path to survive the economic crisis and scale accordingly.
“Since the launch of Michigan Rise in August 2020, the fund has invested $3.5 million in 24 companies which have cumulatively raised more than $99 million in dilutive and non-dilutive funds. Nearly 80 percent of Michigan Rise portfolio companies are led by founders that have historically been underserved,” said Michigan Rise Director Prem Bodagala.
Two of the companies Michigan Rise has invested in the past year are Greenmark Bio, based in East Lansing and 86 Repairs, based in Grand Rapids. Greenmark Bio recently received approval from the FDA to market its first product, a preventative dental care product called Lumicare Caries Detection Rinse, as a 510K Class II device and plans to begin sales of the product in the fall of this year.
One of Michigan Rise’s earliest investments at the height of the COVID pandemic was 86 Repairs. Disrupting the $26 billion restaurant equipment repair and maintenance industry, 86 Repairs automates the end-to-end repair and maintenance process for restaurants and provides actionable insights to improve back-of-house operations. The company was founded by Grand Rapids natives Daniel Estrada and Joe Gallagher and had its best growth in the past 12 months, capping it off with a $7.3 million raise in early July this year which saw participation from Midwestern and coastal venture funds.
“Our team is excited to begin the second year for Michigan Rise. The collaboration with the MEDC and the Michigan Strategic Fund has been tremendous. Together we have had the opportunity to fund 24 companies in 10 months,” said Michigan Rise Executive Director Jeff Wesley. “I am extremely thankful to our team for their hard work to have a positive impact on Michigan startups and their trailblazing leaders, and for curating a portfolio of exciting and innovative companies.”
In addition to the amendment to the Pre-Seed III Fund, the Michigan Strategic Fund also approved support for a wide array of projects including a new grocery store on Flint’s north side, Ford Ion Park in Romulus, a new much-needed spec facility in Highland Park, and community revitalization projects along with other actions that will continue to strengthen Michigan’s economy and position the state for future prosperity. Read more about these projects here.
MEDC’s Entrepreneurship & Innovation initiative establishes Michigan as the place to create and grow a business by providing high-tech start-up companies with access to a variety of critical resources, such as funding and expert counsel, from ideation to maturation. For more on MEDC Entrepreneurship & Innovation visit www.michiganbusiness.org/entrepreneurship.
About Michigan Economic Development Corporation (MEDC)
The Michigan Economic Development Corporation is the state’s marketing arm and lead advocate for business development, job awareness and community development with the focus on growing Michigan’s economy. For more information on the MEDC and our initiatives, visit www.MichiganBusiness.org. For Pure Michigan® tourism information, your trip begins at www.michigan.org. Join the conversation on: Facebook Instagram LinkedIn, and Twitter.
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