Michigan is becoming a new hub for venture capital and private equity finance

 

Here’s a recent message from David J. Brophy, Director, Center for Venture Capital and Private Equity Finance:

CVP SPURS ENTREPRENEURIAL FINANCE CAREER CONNECTIONS

At the Center for Venture Capital and Private Equity Finance (CVP), we have noted a marked increase in venture capital investment activity in, out, and through Ann Arbor over the past year. This trend has created greater exposure for start-up ventures led by U-M student entrepreneurs and funded by Ann Arbor venture capitalists, including many of our alumni.

Drawing upon the deep pool of Michigan creativity and talent, our students and graduates are generating entrepreneurial ideas, bringing them to application, shepherding them through multiple prototypes and then making their financing pitch to investors on the coasts or in the nation’s heartland.  Nowadays, savvy global investors are willing to look farther afield to source new deals, including here in the University’s own backyard. Likewise, alumni from the Ross School and the College of Engineering who have done stints at Silicon Valley or on Wall Street are now gravitating back to Michigan and Ann Arbor to open investment offices. Our state currently has 25 venture capital funds providing growth capital to promising start-ups spawned by University research discoveries and inventions across various academic disciplines. This ramped-up connectivity augers well for our reputation as an innovative community and a source for high-potential technology and social-networking investment deals.

Private equity also has taken root in Michigan, where well-established firms are sourcing and partnering on deals with PE investors from across the country. In recent years, we’ve seen the sector’s investment focus shift away from using takeover capital to buy entire companies and turn instead toward investing growth capital in companies through partial acquisitions, known as leveraged recapitalizations. CVP has supported the industry’s recalibration through our coursework and case writing. In addition, we have paved the road to careers in entrepreneurial finance by inviting alumni to return to campus. This past year, we hosted a series of three fireside chats that brought 45 leaders from venture capital or private equity together with students. Their conversations helped to illuminate the field and underscore their willingness to recruit Michigan graduates for their companies.

Currently, the Center is formulating plans to expand our footprint in global alternative investment management by promoting new courses and greater interaction between students and financial practitioners. We are well-positioned at the nexus of entrepreneurship and finance to help our graduates strengthen Michigan’s standing in the venture capital and private equity investment landscape.

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