Wisconsin company sees state's potential
Venture capital firm to open Ann Arbor office next month
News Business Reporter
A Wisconsin-based venture capital firm will open an office in Ann Arbor and use money from the state to invest in Michigan start-up companies.
"We think there's a lot of opportunity in Michigan and a lot of it is centered around opportunities at major research institutions," said John Neis, managing director of Venture Investors LLC of Madison, Wis.
The company expects to announce the location of the Ann Arbor office in early April.
Venture Investors was authorized by the Michigan Strategic Fund to invest up to $10 million in seed and early-stage life sciences, information technology and engineering companies.
The money comes from the 21st Century Investment Fund, part of the state's program to revitalize Michigan's economy, which is funded through the state's portion of the tobacco settlement.
Expanding in Michigan is a natural extension of Venture Investors' business model, Neis said. The firm in the past has focused on technology transfer opportunities from the University of Wisconsin at Madison, "but as we look to expand our footprint in the U.S., the obvious place to go was Ann Arbor," Neis said, adding that the area broadens the company's investment opportunities.
He said Venture Investors will focus on technology transfer deals out of the University of Michigan, Michigan State University, Wayne State University and other organizations.
The fact that Michigan still lags behind the East and West coasts in terms of venture capital presents an opportunity for firms like his, he said.
Ann Arbor venture capital firm EDF Ventures also was authorized to receive up to $7.5 million from the 21st Century Investment Fund to invest in seed and early-stage companies focusing on life sciences and technology.
The $109 million 21st Century Investment Fund is part of state's 21st Century Jobs Fund, the state's effort to diversify and revitalize Michigan's economy. Investments must be in companies with a strong Michigan presence.
EDF also received an undisclosed amount of money from Venture Michigan Fund I, another state venture capital initiative, to invest in start-up companies. EDF officials declined to comment on Thursday.
In general, amounts of investments are not disclosed during fundraising periods, said Kelly Williams, managing director of Credit Suisse, the firm managing the Venture Michigan Fund and the 21st Century Investment Fund.
As an independent nonprofit corporation, the Venture Michigan Fund is not obligated under law to disclose the amounts, Michigan Economic Development Corp. spokesman Mike Shore said.
Last month, Ann Arbor venture capital firm Arboretum Ventures also received money from the Venture Michigan Fund.
Investments are expected to made in emerging technologies such as health care and life sciences, homeland security, alternative energy and advanced manufacturing.
Both funds are managed by Credit Suisse, a Swiss asset management firm.
Contact Jenny Rode at jrode@annarbornews.comor 734-994-6843.