Startup News

Paxahau moved from Ferndale to Greektown a year ago. In that time, it has hired six new people. Coincidence? The people behind the electronic music company don't think so.

"It's a very strong relationship between what we do and the city limits proper," says Jason Huvaere, president of Paxahau. "It's very important for us to be here. And we love being here."

Paxahau moved into 3,500-square-feet of office space above Flood's Bar & Grille in the Cronice & Slate Building, adjacent to the Blue Cross Blue Shield campus. Its 15-person staff organizes large events in the city and beyond, such as the Movement Electronic Music and Detroit Jazz festivals. That staff also includes dozens of interns during those events, which serves as a talent pipeline for the company.

"We hire a lot of our interns," Huvaere says. "We just hired two of them."

The company is currently working on rebranding Movement and redesigning the festival's layout to fit the changing contours of Hart Plaza. It's also working on enhancing its music technology to better capitalize on the music produced at its events.

Source: Jason Huvaere, president of Paxahau
Writer: Jon Zemke

Read more about Metro Detroit's growing entrepreneurial ecosystem at SEMichiganStartup.com.

The City of Hamtramck is looking for you, if you have entrepreneurial ambitions of opening a new business in one of Michigan's most dynamic cities.

The city will host the Hamtramck Business Start-up Information Session at Cafe 1923 this Wednesday evening (Feb. 20). The idea is to help prospective business owners learn about things like business planning, lining up financing, creating a marketing plan and scaling their enterprises. Hamtramck has enjoyed quite a bit of success as of late with cultivating and attracting businesses, such as Perkins Pickles, Rock City Pies and Chiipss skateboard shop.

"We want to build on some of the momentum we have had in the last few months," says Jason Friedmann, community & economic development director for the City of Hamtramck.

Hamtramck is partnering with D:hive to offer BUILD classes, the nonprofit's 8-week small business start-up training program. The normal fee for the class is $1,200 but Hamtramck residents will be able to take advantage of the course for far less. Prices will be determined on a sliding scale between $100 and $300.

Hamtramck has enjoyed a lot of success recently in helping cultivate creative, sustainable and lifestyle businesses, but the city would like to expand its diverse business climate to include some new economy startups. It is working with Detroit Start-up Drinks to host one of its gatherings in April.

"There is a lot of small retail space that could be repurposed as offices," Friedmann says. "We are working on a loft building that could house startups."

The Hamtramck Business Start-up Information Session will take place between 6:30 and 8:00 p.m. at Cafe 1923, 2287 Holbrook.

Source: Jason Friedmann, community & economic development director for the city of Hamtramck
Writer: Jon Zemke

Read more about Metro Detroit's growing entrepreneurial ecosystem at SEMichiganStartup.com.

The folks behind Challenge Detroit are looking to build on the talent attraction/retention initiative's initial success by repeating it this year.

Challenge Detroit brings in a couple dozen recent college graduates to Detroit each year, giving them jobs and coordinating opportunities for them to live, work and play in the city. The nonprofit pairs the fellows from each class with local employers and provides them with a living stipend. Last year it welcomed 29 fellows that work for the likes of Compuware and Quicken Loans. This year it plans to bring in another 30 young people as part of its second class.

"It's a manageable number for us," says Deirdre Greene Groves, executive director of Challenge Detroit. "It's a number that allows a greater sense of comradery in the group. They can still get to know each other."

Challenge Detroit is part of a growing number of talent initiatives that looks to bring more recent college graduates to Detroit by matching them with jobs. Organizations like Teach for America and Venture for America pair dozens of young people with positions in local schools and startups, respectively.

Challenge Detroit pairs these graduates with jobs at a number of larger corporations, nonprofits and institutions, providing them with a living stipend of $500 per month. It asks in return that the participants live, play and volunteer in the city. This year, Challenge Detroit is working to make sure its participants more fully capitalize on its experiences.

"We want to make sure we are giving a great benefit to our partners," Greene Groves says. "How can we spend a couple more weeks on them?"

Challenge Detroit is currently accepting applications for its 2012-13 class, which are due by March 3. For information, click here.

Source: Deirdre Greene Groves, executive director of Challenge Detroit
Writer: Jon Zemke

Read more about Metro Detroit's growing entrepreneurial ecosystem at SEMichiganStartup.com.

When the M@dison Building opened in downtown Detroit in late 2011, Detroit Labs was one of the first start-ups to move in. Today the mobile app company has grown to the point where it's almost standing-room only in its office, prompting it to start building out its own office nearby on Woodward Avenue.

"We are out-growing our space like you wouldn't believe," says Paul Glomski, co-founder & CEO of Detroit Labs. "We're proud to say, 'We are the fastest-growing startup in Detroit.'"

Detroit Labs launched in May 2011 as one of Detroit Venture Partners' first portfolio companies. It started out creating custom mobile apps for the likes of Quicken Loans, Stryker and Chevrolet.  It has now taken on work for Domino's Pizza, a company that is almost as well known for its software innovation as its pizza. Glomski points out that Domino's pizza ordering app does about $4 million in business a week, and Detroit Labs is one of the key players in helping make that happen.

"They wanted to bring in a team that lives and breathes mobile day and night," Glomski says. He adds that Detroit Labs will continue to do custom work for big companies in 2013 but also expects to begin creating its own original apps this year. "We have a lot of areas we are looking at," Glomski says. "We have a lot of games we're working on. We have an app in the app store (called Koha) that helps people share bills (for things like groceries and going out to eat)."

All of this new work has prompted Detroit Labs to go on a hiring spree. It has doubled its staff to 32 employees and some summer interns. Glomski expects his staff to surpass 50 by the end of the year. That expansion has led the company to make the most of its 2,000 square feet in the M@dison Building, creating makeshift standing desks and even turning a treadmill into a work space.

Detroit Labs is building out its own space less than a block from the M@dison Building. Glomski declined to reveal the address but did say it's a building owned by Dan Gilbert and will measure out to 10,000 square feet. The new space will be similar to the unique nature of the M@dison Building and should be good to go within a few months.

"They're already swinging hammers and doing the actual build out," Glomski says. "It will be very unique. Our team is taking a sense of ownership to build out the space. It will be spectacular. It will be unique to Detroit Labs. It will be cool and collaborative. Every building Dan Gilbert and Bedrock (Gilbert's real-estate development company) do is unique and this will continue that trend."

Source: Paul Glomski, co-founder & CEO of Detroit Labs
Writer: Jon Zemke

Read more about Metro Detroit's growing entrepreneurial ecosystem at SEMichiganStartup.com.

Tom Perkins never planned to become a professional pickler until a little more than a year ago. Now he has his own growing business, Perkins Pickles, that is getting ready to open up its own production facility in Hamtramck.

Perkins describes the creation of Perkins Pickles as accidental. The reporter for AnnArbor.com has always been a pickle connoisseur. When he lived in Chicago in 2008-09, he and his co-workers would always choose their lunch location based on their search of finding the best pickle in town. Frustrated, Perkins came to a conclusion.

"I finally decided I could do better and made my own," Perkins says. "I never had any intention of starting my own pickle company. I ended up winning a 'pickle-off,' and a friend's dad suggested I turn it into a business."

Perkins spent the last eight months making his pickles in the kitchen of Traffic Jam & Snug restaurant, which allowed him to create about 30 cases of pickles a week. He has grown his business to a team of 10 people making and selling pickles that appear in retail locations across Metro Detroit.

Perkins Pickles is now putting the finishing touches on its own space in Hamtramck, at 2635 Caniff, an older house turned retail space. The 1,500 square feet space, set to open late this winter, is coincidentally down the street from a vacant building that was once a pickle factory. That space was too big for Perkins and his team, but the new space will give Perkins Pickles the capacity to increase its production ten fold, to 300 cases per week.

"People image a pickle factory like a Willy Wonka type of thing," Perkins says. "It's nothing like that all."

He points out that half of the space will be used for storage and production filled with brine containers instead of rivers of chocolate. Perkins does expect to continue expanding his team to up to 15 people as orders steadily grow.

Perkins Pickles recently scored some shelf space in Hiller's Markets, and is aiming to make its products a fixture in supermarkets across Michigan and into Chicago later this year.

Source: Tom Perkins, owner & chief pickler at Perkins Pickles
Writer: Jon Zemke

Read more about Metro Detroit's growing entrepreneurial ecosystem at SEMichiganStartup.com.

Ray Wert named his new custom publication business Tiny Toy Car because he wants its readers to see the stories about automobiles the same way a child sees a car.

"The name comes from how a child looks a tiny toy car and all they see is a story," says Wert, founder of Tiny Toy Car. "That's what we create for automakers, a story."

Wert is an executive with Gawker Media and was previously editor in chief of the company's automotive website, Jalopnik. He is launching Tiny Toy Car in downtown Detroit this month as a vehicle for creating custom media content for advertisers in the automotive industry. It's working with a number of brand-name firms, including Gawker Media, major automakers and Detroit Labs.

Tiny Toy Car currently employs Wert, but he expects to expand the staff in the coming weeks as the firm's operations are fleshed out. Wert expects to open offices in New York City and Los Angeles later this year.

"I'd like to be in all three of those centers of automotive and media power," Wert says. "I'd also like to be at double-digit employees."

Source: Ray Wert, founder of Tiny Toy Car
Writer: Jon Zemke

Read more about Metro Detroit's growing entrepreneurial ecosystem at SEMichiganStartup.com.

The men behind SchedFull know that businesses lose money when appointments are cancelled or not kept. It's why they designed a software platform that helps confirms things like doctors appointments and reschedule people who cancel.

Thanh Tran, a serial entrepreneur in health-care technology, teamed up with Tashfeen Ekram, a radiologist at Henry Ford Hospital, to create the technology so people would keep doctors' office appointments and reschedule the people who cancel them. They are also trying to work the software platform into other businesses, such as salons.

"We saw potential in other industries, not just health care," says Thanh Tran, operations officer for SchedFull.

SchedFull is offering its services in a public Beta right now at a $20 monthly subscription rate. Each lost appointment costs a medical office well in excess of $100, so Tran and Ekram see the software creating a significant value. The software currently has a couple dozen Beta users and Tran expects that number to grow as his two-person team continues to build out its software .

"We're looking to get more resources," Tran says. "We're looking for funding."

Source: Thanh Tran, operations officer for SchedFull
Writer: Jon Zemke

Read more about Metro Detroit's growing entrepreneurial ecosystem at SEMichiganStartup.com.

TechTown is partnering with Bizdom and Invest Detroit to create the Detroit Technology Exchange, an initiative focused on the development of talent, technology, deal flow and cutting-edge startups.

Making it possible is a $1 million grant from the state's Michigan Strategic Fund. The grant, which will be disbursed over a two-year period, is aimed at leveraging existing economic development investments from organizations like the New Economy Initiative for Southeast Michigan to continue the development of Detroit's new economy.

"These power partnerships are what is going to move us forward," says Leslie Smith, CEO of TechTown. "We have to come together collectively to think about the macro problems and tackle them."

The Detroit Technology Exchange consists of four programs geared toward talent retention/attraction, exploiting disruptive technologies, creating robust deal flow, and supporting the early stage startups. The four programs include:

• Integrated Ecosystem Services: This program will institute practices like monthly portfolio reviews to identify opportunities for collaboration and critical marketing and design assistance for companies. The idea is to fill the gaps in the city's entrepreneurial ecosystem and help participating firms attract investment.

• Launch Detroit: A summer boot camp for aspiring entrepreneurs in college (both graduate and undergraduate) that want to launch tech startups. The 10-week program will provide a stipend to participants and work to connect them with the city's entrepreneurial ecosystem. It aims to encourage young talent interested in technology to either remain in Detroit or move to the region.

• D-Venture: This executive-in-residence program will bring selected entrepreneurial-minded professionals to Detroit to create startups out of underutilized or underdeveloped intellectual property. Each participant develops a business plan, acts as CEO, raises seed capital, and receives an annualized salary for six months to one year.

• Detroit Technology Exchange Fellows: This fellowship program will insert individuals into the Motor City's entrepreneurial service organizations and startups. The plan is to infuse high-quality, mid-level talent to Detroit's entrepreneurial ecosystem. It will provide six fellows with an annualized salary over two years.

"More (talent) is better," Smith says. "Sometimes I think we're afraid of more. I think more is better. We are nowhere near having too much talent in the region."

Source: Leslie Smith, CEO of TechTown
Writer: Jon Zemke

Read more about Metro Detroit's growing entrepreneurial ecosystem at SEMichiganStartup.com.

If you're interested in Innovation & Growth News from throughout Metro Detroit, do yourself a favor and check out our sister publication called SEMichiganStartup.com. Startup covers Innovation & Growth News from Ann Arbor to Royal Oak to Mt. Clemens in its weekly online magazine, which publishes each Friday. You can also sign up for email alerts on your favorite startups and entrepreneurs here.

Rockbridge Growth Equity has expanded its staff by four people over the last year as the private-equity firm makes both a successful exit and acquisition.

The downtown Detroit-based company has hired two investment professionals and two operations professionals, expanding its staff to 13 people. "We're looking to add two more investment professionals and one more operations professional," says Kevin Prokop, founding partner with Rockbridge Growth Equity.

That growth comes after the 5-year-old company has deployed about $250 million in its lifetime, including investing $50 million in 2012. One of its investments is in One Reverse Mortgage, which Rockbridge Growth Equity held a stake in with Quicken Loans. It sold its stake in One Reverse Mortgage to Quicken Loans last year after helping One Reverse Mortgage grow to the become what Prokop calls "the largest reverse mortgage company in the world."

Rockbridge Growth Equity also recently made an investment in Triad Retail Media, an online advertising firm based in Tampa. "It's a fast growing company in a fast growing industry," Prokop says.

Source: Kevin Prokop, founding partner with Rockbridge Growth Equity
Writer: Jon Zemke

Read more about Metro Detroit's growing entrepreneurial ecosystem at SEMichiganStartup.com.

AutoHarvest, the nonprofit focused on fostering collaboration and innovation in the auto industry, is prepping to launch a new software platform that the organization's leaders are calling the Amazon.com of intellectual property innovation.

The new marketplace for innovation will allow inventors, entrepreneurs, businesses and institutions to buy, sell and collaborate on technology. The eBay-like platform is currently in private Beta with about 1,000 participants. It expects to launch publicly later this year and expand to reach several thousands of users by the end of 2013.

"This lets people have a line of sight to an opportunity, whether it's a technology or a need," says Jayson Pankin, president of AutoHarvest. "That means the next Steve Jobs working in a garage can have that opporutnity to reach out and collaborate and transact."

AutoHarvest is 2 years old and has offices at TechTown in Detroit and at the University of Michigan in Ann Arbor. It has a staff of six people, including a rotation of fellows from local universities. These fellows, ranging from undergrad to MBA students, work at AutoHarvest for several months before rotating into the automotive/tech industries. So far about a dozen fellows have gone through the program.

Source: Jayson Pankin, president of AutoHarvest
Writer: Jon Zemke

Read more about Metro Detroit's growing entrepreneurial ecosystem at SEMichiganStartup.com.

Darci McConnell spent 14 years as a newspaper reporter before leaving the profession about a decade ago.

At that moment in life she heeded the advice of family and friends, including well-known local businessman Don Barden, and decided to create her own job instead of looking for one. That decision led to the creation of McConnell Communications, a public relations firm based in Greektown.

"I figured that some of my frustrations with journalism wouldn't change with geography," McConnell says.

Barden Companies became one of McConnell Communication's first customers, letting McConnell handle communications work in the Detroit market. Today, McConnell Communications employs three people and has a growing client list that includes Metro Property Group. It has also handled communications work for Proposal 2 and Proposal 3 in last year's election.

McConnell Communications recently hired a new media manager, which allows the firm to handle more digital work, such as search engine optimization and social media. "I recognized that if we didn't find a way to balance the old and new media it would be difficult to compete," McConnell says.

She plans to keep her company small for the foreseeable future. "We never wanted to be a huge company," McConnell says. "We want to be a boutique company that can compete with big companies."

Source: Darci McConnell, president & CEO of McConnell Communications
Writer: Jon Zemke

Read more about Metro Detroit's growing entrepreneurial ecosystem at SEMichiganStartup.com.

Fusion Coolant Systems recently secured an investment from the Michigan Pre-Seed Capital Fund, wrapping up a $600,000 angel round. The Detroit-based startup is also looking at conducting a Series A fundraising round worth $1 million that could wrap up by next year.

"We're not in a fundraising mode right now," says Tom Gross, CEO of Fusion Coolant Systems. "We're on a friend-raising mode right now."

The nearly 4-year-old company makes an environmentally friendly cutting fluid for industrial uses that help improve cutting tools performance while reducing the wear. Fusion Coolant Systems technology could eliminate the toxic cutting fluids that are standard today in sectors like aerospace and automotive. Its products are used by the like of General Electric, Ford, Masco and Boeing.

Fusion Coolant Systems moved last year to the manufacturing center at Focus: HOPE on Detroit's West Side, where it now employs seven people after hiring an engineer and sales manager over the last year. Gross hopes to hire 3-4 more people and hit sales of $1 million within the next year.

"We're already in the market now," Gross says. "We're looking to accelerate."

Source: Tom Gross, CEO of Fusion Coolant Systems
Writer: Jon Zemke

Read more about Metro Detroit's growing entrepreneurial ecosystem at SEMichiganStartup.com.

Peter Van Dyke has been named a full partner at Berg Muirhead and Associates and the New Center-based public relations agency announced it has expanded its staff.

Bob Berg and Georgella Muirhead opened the company in 1998 with Van Dyke coming aboard in 2006. It currently employs nine people after hiring two more account executives over the last year.

"It's exciting," Van Dyke says. "It's a great company to be a part of the leadership team."

Berg Muirhead has traditionally supplied public relations and marketing services to a number of the Motor City's biggest names, such as Faygo and Strategic Staffing Solutions. It recently expanded its clientele to include retail businesses, like Edible Arrangements and the Somerset Collection, while also doing projects with the state of Michigan.

The increased workload prompted not only the recent hirings but Van Dyke's promotion to partner. He joins Berg and Muirhead who are still active with the company, while Van Dyke serves as the day-to-day manager.

"We found that there was a demand to have three people as figureheads of the company," Van Dyke says.

Source: Peter Van Dyke, partner of Berg Muirhead
Writer: Jon Zemke

Read more about Metro Detroit's growing entrepreneurial ecosystem at SEMichiganStartup.com.

H2bid watched its user base expand significantly in 2012, allowing the Midtown-based Internet start-up to expand its team to 20 people with the addition of three new hires.

The 7-year-old company provides e-procurement services for water utilities. Its software helps these water utilities bid out projects over the Internet, helping ensure they get the best deal in the most cost-effective manner.

"It (the jump in usership) reflects the adaptation of the technology in this area," says Glenn Oliver, CEO of H2bid who formerly worked for the Detroit Board of Water Commissioners in the late 1990s. "People are getting more and more into using online resources for project bidding.

H2bid is also working to expand the connectivity between companies that bid on these sorts of infrastructure projects and the subcontractors that do the work. The firm is also starting to take on more bidding for projects in Canada.

"We are starting to grow globally," Oliver says.

Source: Glenn Oliver, CEO of H2bid
Writer: Jon Zemke

Read more about Metro Detroit's growing entrepreneurial ecosystem at SEMichiganStartup.com.