2 Detroit Metro nonprofits receive funding to support entrepreneurs
Two entities in the Detroit metro area – Automation Alley in Troy and TechTown in Detroit – are among the 50 recipients of funding from the US Economic Development Administration.
The funding, announced Thursday, is part of the Biden administration’s Build to Scale program, which aims to strengthen inclusiveness in access to business support and capital for entrepreneurs in the tech space.
Detroit Metro companies that receive funding, in the form of grants, are among higher education institutions, state government agencies, nonprofits, and 26 state organizations that will receive funding from 36, $ 5 million.
The annual grant program has two categories: the Capital Challenge, which facilitates access to capital in places where there is a shortage, and the Venture Challenge, which enables job creation and innovation in tech entrepreneurship. .
“These EDA investments support aerospace, agtech, blue economy bioscience, advanced manufacturing and health technology clusters in regions of the United States and will lead to the creation of stronger economies. and more resilient across the country, “Alejandra Castillo, assistant secretary of commerce for Economic Development, said Thursday at an event in Detroit. “And we’re so excited to be here in Michigan, because two of our award winners are from here in Michigan.”
Capital Challenge recipient TechTown Detroit is expected to receive $ 400,000, which will be used to train 200 angel investors. The nonprofit, which is a business and startup accelerator and incubator, will focus on recruiting and teaching women and people of color how to become investors.
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There is a plan to support 50 projects, which will bring in $ 34.7 million in capital. All this in partnership with the Angel Capital Association, VentureWell and Ann Arbor SPARK.
“This award is really about structural change,” said Ned Staebler, president and CEO of TechTown Detroit. “It’s about breaking down barriers. It is about overcoming decades and centuries of institutional racism. The situation we’re looking at is that the founders of Black and Brown in America make up about 8% of tech companies, which is really bad to be honest with you. But even worse, in the first half of this year, they received less than 1% of all venture capital.
Staebler says the founders of Black and Brown don’t have access to capital because investors expect a lot of back progress up front. It requires funding, networking, support, and even some prior knowledge that many may not have. TechTown Detroit has increased the black and brown entrepreneurship makeup of its incubator and accelerator program from 20% to 60%.
Automation Alley, which is a not-for-profit organization that helps innovation and cutting edge technology and is a Venture Challenge recipient, will receive $ 1.3 million to provide resources for its Industry 4.0 accelerator. This program helps start-up manufacturing companies adapt technology and digitize manufacturing systems.
“We need every manufacturer to become a software company,” said Tom Kelly, executive director and CEO of Automation Alley. “It is essential that we educate our manufacturers and help them with this transition, because manufacturing is a game of little men. This accelerator will allow us to recruit technologies that will help our small businesses gain this competitive advantage and navigate this risky path. “
Automation Alley is partnering with Lawrence Technological University’s Centrepolis Accelerator and the Lean Rocket Lab to help manufacturers as technology continues to evolve.
The United States Economic Development Administration plans to distribute $ 3 billion in grants and recipients will be chosen over the next year, Castillo said. These recipients will be chosen through different challenges in the American Rescue Plan EDA programs.
Contact writer Chanel Stitt on Twitter: @ByChanelStitt. Become a subscriber or offer a subscription.