FOR IMMEDIATE RELEASE???
March 26, 2024?
Contact: [email protected]??
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Lt. Gov. Gilchrist Announces?Approval for up to?$22 Million in SSBCI 2.0 Funding to Support Michigan?s Entrepreneurial Ecosystem?
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LANSING, Mich. -- Today, Lt. Governor Garlin Gilchrist II joined the Michigan Economic Development Corporation in announcing Michigan Strategic Fund approval of up to $22 million in State Small Business Credit Initiative (SSBCI) 2.0 Michigan Small Business Venture Capital Program (SBVCP) funds to support two venture capital investment funds.??
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Union Heritage's Future Heritage Fund?will target Socially?Economically?Disadvantaged?Individuals?(SEDI) and very small businesses (VSBs), while Venture Investors Healthcare Fund will support early-stage companies in the health sector, underscoring the state?s leadership in small business support and innovation. ??
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?Michigan is the place from which people from every background and walk of life who have big ideas can and will change the world,? said Lt. Governor Garlin Gilchrist II. ?The SBVCP support for Michigan?s first Black-led venture capital fund will foster the success of diverse entrepreneurs working every day to grow their companies. It shows the world that the state of Michigan is putting our money where our mouth is and ensuring small business and early-stage companies, especially those who have been left out of funding opportunities in the past, can thrive, and make it, right here in Michigan.??
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SBVCP provides up to $75 million to increase the availability of capital to early-stage, technology-based businesses in the state of Michigan. As approved by the U.S. Department of the Treasury, the program supports funding for qualified for-profit early-stage, technology-based businesses by investing as a limited partner in venture capital funds operating in the state.?
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The Heritage Fund?and Venture Investors Healthcare Fund will each be eligible for up to $11 million in SBVCP funding, allowing them to invest in companies throughout the state. If fully drawn, the $22 million in SSBCI investment will result in more than $44 million in investment in early-stage Michigan companies.?
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The Future Heritage Fund is being launched as a venture capital investment fund with a general purpose of realizing long-term appreciation from early-stage venture capital investments in private companies which are primarily led by underrepresented and/or socially and economically disadvantaged founders or provide a product/service that addresses an issue that disproportionally affects SEDI populations. The fund has a target size of $25 million and will operate exclusively within the state, supporting Michigan-based companies.?
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?We are thrilled to receive this award from the MEDC and MSF Board to invest in founders in the Michigan early-stage ecosystem,? said Derek Batts, Chief Investment Officer of Union Heritage Venture Partners. ?This new State Small Business Credit Initiative 2.0 Small Venture Capital Program will provide critical early-stage investments to underrepresented startups in Michigan. We look forward to collaborating with the State of Michigan to invest in high growth unrepresented founders that are building and scaling their businesses in the Michigan ecosystem."?
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The Venture Investors Healthcare Fund, proposed to be a sidecar to the primary regional fund that emphasizes the Midwest region, will make investments in Michigan-based, early-stage healthcare companies. The fund?s investment portfolio will primarily focus on medical devices and diagnostics, biopharma, therapeutics, and vaccines.?
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"The MEDC's support and this investment by the SSBCI 2.0 program enables us to continue our long history of investing in breakthrough healthcare companies in Michigan," said Jim Adox, executive managing director of Venture Investors Healthcare Fund.??
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SSBCI is designed to catalyze private capital in the form of loans to and investments in small businesses, particularly in historically underserved communities and among entrepreneurs who may have otherwise lacked the support needed to pursue their business ambitions. SSBCI support can be transformative in a range of industries, including small manufacturing, supply chain, and other sectors.?
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The MEDC continues to leverage the full suite of SSBCI resources to improve access to capital for Michigan entrepreneurs. Michigan received its first round of SSBCI 2.0 funding ? $72 million of the total $236 million allocation from U.S. Treasury ? in May 2022. To date, $45 million in SSBCI debt-based capital has been deployed.??
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In October 2023, nine SSBCI Technical Assistance providers were selected to support entrepreneurs across the state in obtaining legal, accounting and financial advisory services to increase awareness of, and readiness for small businesses applying for capital.?
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