Michigan Rise makes 50th startup investment

Wedge HR platform in Grand Rapids is the latest company to benefit from the pre-seed fund.
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A 2-year-old fund started by the Michigan State University Foundation now has invested nearly $6 million in startups across the Mitten state.

The Michigan Rise Pre-Seed Fund III, a subsidiary of the Michigan State University Foundation, in partnership with the Michigan Economic Development Corporation (MEDC), earlier this month said it made its 50th startup investment since its inception in August 2020.

To date, Michigan Rise Pre-Seed Fund III has invested $5.8 million across 50 investments in 38 startups across Michigan, including 12 follow-on investments in 11 portfolio companies.

Jeff Wesley. Courtesy Spartan Innovations and the MSU Foundation

“It’s been incredibly satisfying for our team to work with Michigan’s innovative startup community and to complete our 50th investment in under two years,” said Jeff Wesley, executive director of Michigan Rise Pre-Seed Fund III. “This is not only a great accomplishment for Michigan Rise and the MSU Foundation, but more importantly, it’s a demonstration of the continued growth of our state’s entrepreneurial ecosystem. I couldn’t be more excited about what’s to come and thankful to our dedicated team for the hard work and support they put in daily to achieve this milestone in just a short time for the fund.”

The Michigan Rise Pre-Seed Fund III invests in Michigan technology startups to help commercialize innovative technologies and supports entrepreneurs across Michigan through capital support, coaching, assistance with funding strategies and more.

With an average investment of around $120,000 to date and a cap of $250,000 per company, Michigan Rise touches a variety of industries core to Michigan’s economy, such as life sciences, agriculture tech, energy, mobility and more.

Prem Bodagala. Courtesy Michigan Rise

Prem Bodagala, director at Michigan Rise Pre-Seed Fund III, said the fund launched at the peak of the COVID-19 pandemic, when there was a sudden capital crunch, even for companies that previously were trending well.

“It has been a privilege investing in and working with brilliant Michigan entrepreneurs who have not only withstood the challenges presented by COVID but have thrived in that time,” he said. “It has also been gratifying to see founders who are alumni of Michigan home runs, such as Duo and StockX, launch their own startups, and we are excited to support them in their new innings.”

Michigan Rise’s first investment was in the Ann Arbor-based, pharma-focused startup Genomenon, an analytic and data visualization tool that mines millions of medical publications to deliver a list of disease-gene-variant relationships curated from primary medical literature. The investment round served as a springboard for Genomenon’s core Mastermind technology and Michigan Rise’s entrance into the health care tech industry, according to the MSU Foundation.

The fund’s 50th investment was in the Grand Rapids-based, human resources-focused company Wedge, a video screening and recruiting platform. Founded in 2015, Wedge gives employers the ability to attract, pitch and fast-track applicants through video capabilities. The company strives to “empower hiring teams to achieve better job posting results, meet the right applicants faster and fight biases, all while hiring simpler, faster and more cost-effective.”

Matt Baxter. Courtesy 616 Media

Founder Matt Baxter was a member of the Business Journal’s 2021 class of 40 Under 40 Business Leaders for growing the startup from nothing to thriving in six years. Given the overnight move to remote hiring during the pandemic and the ongoing shift toward a hybrid workforce, Baxter said Wedge is in an ideal position to continue its growth, which so far has included several multimillion-dollar funding rounds.

Fred Molnar, senior vice president of entrepreneurship and innovation at the MEDC, said success stories like Wedge’s are what the state’s economic development partners strive for.

“At the Michigan Economic Development Corporation, we prioritize economic growth and development by partnering with organizations like the MSU Foundation and Michigan Rise,” Molnar said. “Michigan Rise’s work with emerging technology companies is bolstering the state’s economic reputation and increasing entrepreneurial opportunities across all industries. We congratulate Michigan Rise on this remarkable milestone as they continue to foster growth in vibrant communities across the state.”

In the second half of 2021, the state of Michigan saw a 682% rise in early-stage funding, according to Crunchbase. That number is expected to grow in 2022, and the communities where startups convene are thriving, Michigan Rise said.

That holds true for companies like Detroit-based AaDya, a cybersecurity company for small to medium-sized enterprises.

“Michigan has always been known as the center of the automotive industry, so it’s exciting to see funders like Michigan Rise and the Michigan Economic Development Corporation willing to invest in technology companies like AaDya that complement that work,” said Raffaele Mautone, CEO of AaDya. “I am incredibly grateful to be in Michigan and start this business knowing I can shine a spotlight on Detroit, diversity and the technology sector alongside some great partners across the state.”

RIVET Work, a software company for skilled trade contractors also based in Detroit, continues to be a portfolio company of Michigan Rise. Co-founders CEO Ryan Meitl and CMO Alison Accavitti said the Michigan Rise investment allowed them to take on the business full time.

“The investment and support of Michigan Rise helped us scale from a small startup just two years ago to a company employing 14 people,” Meitl said. “By the end of 2022, we expect to have over 20 people on staff.”

Accavitti added working with the MSU Foundation and partnering with Michigan Rise “brings a sense of familiarity and comfort, knowing that I’m part of such a strong community.”

“Being a fellow Spartan is only an added bonus, and to have this continuous connection with the university that shaped me is very special,” she said.

Having reached its 50th investment in under two years, Michigan Rise said it looks forward to what could be next with additional organizational partnerships and investment opportunities.

“When we launched in August of 2020, we put in place an ambitious business plan to have made 32 investments in the first two years,” Wesley said. “Having made 50 investments prior to our second anniversary speaks to the quality pipeline of early-stage venture deals from within the state of Michigan ecosystem.”

More information about Michigan Rise is at michiganrise.com.

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