Michigan 21st Century Investment Fund keeps powder dry for investment

The Michigan 21st Century Investment Fund launched in 2006 but the impact of the $109 million fund is just getting started.

Credit Suisse, which helps manage the venture capital fund of funds, released a report last week with some interesting statistics attached to it. The VCs that have received funding from the Michigan 21st Century Investment Fund have invested $97.4 million in 24 Michigan-based companies. Those start-ups now employ 790 people.

"We are at the inflection point where we can say, 'Hey, it's working,'" says Sean O'Donnell, vice president of Credit Suisse's Michigan office. "There is a lot of dry powder left."

The Michigan 21st Century Investment Fund launched with a goal of providing capital to fund managers making venture capital, private equity and mezzanine investments in Michigan. Those funds are then expected to invest in local companies in the life sciences, manufacturing, healthcare, IT and media industries. Some of the most active firms have been Ann Arbor-based Arboretum Ventures, investing $17.5 million in eight Michigan-based companies. Pegasus V has also made one investment worth $35 million.

"We are far from the (peak)," O'Donnell says. "We are less than 60 percent deployed. There is a lot to be done so the companies that have been invested in have the money to continue to grow."

Source: Sean O'Donnell, vice president of Credit Suisse's Michigan office
Writer: Jon Zemke

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