Michigan Creates Bank Consortium for Innovation -(Why not in your community as well?)

Advanced manufacturing and engineering start ups will have more access to investors in a new Bank Consortium for Innovation brought together by Southwest Michigan First of Kalamazoo, a local economic development intermediary. Eleven bank presidents from Kalamazoo County will work closely with Southwest Michigan First to help life sciences’ companies connect with potential investors. Monthly investment forums will connect start-ups with capital and showcase business plans from life sciences and high-tech companies. Participants receive critical feedback to improve their business model and approach to market from experts in the fields of business development and venture fund investments.

Contact: Sam Leiken
Social, Economic and Workforce Programs Division

http://www.nga.org/center/frontAndCenter/1,1188,C_FRONT_CENTER%5ED_6806,00.html

The consortium, the first of its type in the state and possibly in the nation, is unusual because bankers typically regard startup businesses with great caution. The Kalamazoo banking community’s involvement is not intended to provide a means to finance new businesses. Because these tend to be high-risk investments—and often without physical collateral—startup funding is traditionally found in the venture community where investors offset the risk by requiring a percentage of the company’s profits, and adding value through a board seat, connections into that industry, and business mentoring.

The consortium will provide support to new businesses as they transition from startups to asset-managed companies. They provide access to and information about Kalamazoo businesses and can provide financial coaching to entrepreneurs. The CEO of Southwest Michigan First notes that the initiative is a significant investment of time, financial support, and sweat equity on the part of every major bank in Kalamazoo—an effort likely to be seen as a "best practice" by other communities and a model replicated around the country.
Related Links:

* Bank Consortium for Innovation http://www.southwestmichiganfirst.com/bank/