University of Michigan ’19 | Mechanical Engineering
San Francisco. Boston. New York City. Detroit. We all know the first three cities have a reputation for great startup culture, but Detroit? And if Detroit, and Michigan in general, has an emerging startup culture, why do startups want to be there in the first place?
Everything is already here.
For a rather new manufacturing company, take Detroit Bikes for example, every material supplier, powder coater, paint stripper, metal fabricator, machinery service provider, and shipping company is no farther than a 20 minute drive. For a small company, this is a HUGE advantage. Small quality control issues can be ironed out. Sample parts obtained. Shipments packaged and delivered in days, not weeks. Time is something small companies don’t have when operating on a tight budget. If you want to build something, Detroit was and still is the place to be.
What if you just have an idea, but need some help along the way? Between Ann Arbor and Detroit alone, there are several incubators, accelerators, and resources: Ann Arbor SPARK, TechStars, Desai Accelerator, Grand Circus, Automation Alley, and TechTown, to name a few. And that’s just Ann Arbor and Detroit, not including Grand Rapids, Kalamazoo, or the rest of Michigan.
Everybody is already here.
Sure, in Silicon Valley talent is abundant. Talent available in Michigan as well. The University of Michigan. The “other” Michigan University. A host of other schools where intelligent and creative students are graduating from. The hardest part has been getting them to stay in Michigan. With a resurgence of the automotive industry, an emerging startup culture, and the rebuilding of the state’s economy, recent graduates might want to work closer to home.
A history of innovation.
Even before Henry Ford began producing cars in 1903, Detroit has been a hub for commerce, manufacturing, and business. Since Compuware and Quicken Loans moved their headquarters downtown, more companies have been following suit. With startups setting up shop all over the state and feeding the already-present spirit of innovation, Michigan’s future is bright.
Overvaluation is less likely.
With a huge amount of VC being poured into Silicon Valley, experts and other entrepreneurs have warned about an impending bubble. Many startups are being overvalued and not meeting investor expectations when exiting, which is leading to a general decrease in large investments. Many of these overvalued startups in Silicon Valley have no viable revenue model, something startups in Michigan need from the get-go because of a lack of large amounts of venture capital. Michigan needs more investment, and maybe, some of those West Coast investors will soon be looking for new companies that’ll give more bang for their buck.
Cool places to live.
Culture. Outdoors. Nightlife. Housing. Ann Arbor and Detroit are simply cool places to live. In Detroit, Corktown, Greektown, and Eastern Market are becoming lively centers of activity. Ann Arbor is consistently ranked in the top five best college towns, and is the perfect place for younger graduates and couples to live. Though I have been a rather short term resident, Ann Arbor has been one of the most exciting places to live. Even more so when it’s warmer.
Detroit hustles harder.
The Midwest is known for its hardworking people, and Detroit is no exception. It has been through tough times, and so has its people. There hasn’t been a better time to start something, whatever it may be, in the Motor City.
About the author: I am interning at Detroit Bikes, a bicycle manufacturing company in Detroit. Detroit Bikes has the capacity to build 100 bikes a day, the highest volume domestic frame manufacturing since 2009.