One aspect of doing business in Grand Rapids and West Michigan that has been repeatedly cited as “a problem” is access to capital and investor money. The sum of money and assets that cumulatively define the financial strength of a city, region or state — and access to it — have long been noted as one of the constraints in growing businesses in the region. Opportunities have been more often limited to family investment, “deals in the church basement,” or by whom you know.
Start Garden, Bridge Street Capital and its mentoring program provide startup and company growth assets, but the pool is still shallow, especially for second-stage funding. Grand Rapids Business Journal news reports this early July week include interesting comments from the Austin, Texas-based Able Lending president on the occasion of its move into the Grand Rapids market, and from the business leaders of Switch Ltd. and UK-based Orangebox, all with new digs in the Grand Rapids environs.
“In your own backyard, there (are) people with … money and deployable assets. Part of it is committing people in town to be part of that asset class. Work on the people in your own backyard who are committed to investing in the city but need to be educated on how because they’ve never done it before,” said Able Lending cofounder and President Evan Baehr, whose business mission now advancing in 40 states is “to grow the ‘fortune five million’ small businesses in the nation through collaborative, low-interest loans.”
Baehr also noted, “I think Austin’s in a similar boat. You have some outlier situations of companies that randomly exist in Grand Rapids, like in Austin, and they were able to raise some capital and (reach) escape velocity — but in spite of being Grand Rapids. It just happened to be there and it happened to work, but it wasn’t drawing on resources locally,” he said.
The Business Journal also draws attention to the comment from UK-based Orangebox U.S. Sales and Marketing Coordinator Ashley Lewis, a native of Grand Rapids. “I think we can bring a fresh perspective,” Lewis said. “We’re coming from outside of the country, and we have designers that aren’t in this sort of Grand Rapids furniture groupthink. Because we all trade employees amongst each other, we all kind of think about things similarly, and we’ve all kind of grown up around here, we’ve all gone to NeoCon, so I feel like we kind of get stuck in this groupthink where there’s not much new, there’s not much different.” Lewis noted, too, one of the reasons the company decided on a Grand Rapids headquarters is it is home to the “best-quality partners we can pick from” in manufacturing firms familiar with the industry (and a comparatively inexpensive location from a business and tax perspective).
All three companies have cited a “great business ecosystem” in Grand Rapids — and all three see opportunity to elevate that ecosystem with varied types of investments, new approaches and creativity.