Entrepreneurship :Innovation & Job News

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Sphinx Technology Solutions doubles client base, plans first hire

Ryan O'Hara had that safe job. The kind that is rooted in the new economy and paid for by the big corporation. But after a few years of working in IT and other computer-related fields for SBC and Quicken Loans, O'Hara knew there was more out there for him.

O'Hara started Sphinx Technology Solutions in Dearborn two years ago, working his day job while helping customers choose the best technology. Demand for his company's expertise soon outstripped the time he could put toward it while working for someone else, so he made that leap of faith into self-employment.

"More people were leaving these so-called safe jobs to do their own thing," O'Hara says. "For me it was equal parts fear and excitement."

Sphinx Technology Solutions
, a Mac and PC support specialist, has grown exponentially over the last 6-8 months, growing from 10 clients to 20 in that time. O'Hara is expecting that growth to continue and is planning to bring on his first intern and hire this year to keep up.

Source: Ryan O'Hara, owner of Sphinx Technology Solutions
Writer: Jon Zemke

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

AutoHarvest to connect local IP with auto industry

Metro Detroit is sometimes referred to as its own worst enemy when it comes to building businesses and creating jobs. A new non-profit called AutoHarvest is ready to make the region its own best asset by capitalizing on its plethora of intellectual property.

"We think of the auto industry as low-tech and behind," says David Cole, chairman and co-founder of AutoHarvest. "It's not that at all. This is the most complicated industry in the world."

AutoHarvest plans to help connect the automotive industry and Metro Detroit's entrepreneurial ecosystem with the immense amount of intellectual property in the region. The idea is that making these connections will accelerate the deal flow and job creation in both the local auto industry and other emerging sectors.

Cole points out that there are six major automakers with operations in the region and another 350 auto suppliers. Pair those with its two research universities, the University of Michigan and Wayne State University, and its handful of business accelerators and there are not only enough sources of intellectual property but players who can use it. It's only a matter of connecting one to the other.

"This is a marketplace to facilitating collaboration around intellectual property," Cole says. "We think it's going to work."

AutoHarvest is working with each of the Big 3, the Michigan Economic Development Corp, local foundations and business accelerators, and creating a peer group of 50 organizations to draw support from. The non-profit is headquartered in Ann Arbor SPARK's central offices but is also keeping offices in Detroit's TechTown and the University of Michigan's North Campus Research Complex.

Source: David Cole, chairman and co-founder of AutoHarvest
Writer: Jon Zemke

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

Mom turns super hero capes biz into flyaway success

Boil down the description of the PowerCapes.com business to one word, and what comes to mind is "serendipitous".

The Livonia-based business got its start four years ago at a birthday party for Holly Bartman's son's fourth birthday. The special education teacher made her son and all of his guests superhero capes. The gift turned into such a hit at the party that one of the mothers suggested that Bartman sell them.

Bartman took the bait and began selling the superhero capes on eBay and Etsy, an e-commerce site for handmade or vintage items, art and supplies. Demand soon dictated that Bartman move from her home operation to a small studio at the old Winery building in Farmington Hills, where she deployed a few commercial sewing machines and hired her first employee.

Justin Draplin, owner of a social media and signage firm called CityDrip, happened to be next door. Soon he was designing a website for Bartman's superhero capes and wholesaling them. Now he is a managing partner of PowerCapes.com, a company that employs eight people (mostly mothers on a part-time basis) and has a goal of reaching $1 million in revenue this year.

"The next thing I know I am in the superhero cape business," Draplin says. "I never thought I would be in this business or that it would take off. We have been growing exponentially month over month."

PowerCapes.com plans to buy its own building this year to accommodate its growth. Draplin expects its staff to hit 12-15 people by the end of the year as it continues to sell simple, non-branded capes made for budding superheroes. It's also looking to expand its product offering to tutus.

Source: Justin Draplin, managing partner of PowerCapes.com
Writer: Jon Zemke

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

Michigan Pre-Seed Capital Fund hits $11.6M in loans

The Michigan Pre-Seed Capital Fund, a part of the Michigan Microloan Fund, closed out 2010 with some big numbers, shelling out $2.5 million in microloans to Metro Detroit start-ups in 2010.

Each microloan is tailored to the needs of a start-up, averaging about $50,000. The loans provide cash (and validation) tocompanies  in dire need of capital due to the financial crisis. More times than not, that money goes toward commercializing the start-up's first product.

The Michigan Pre-Seed Capital Fund has provided this $11.6 million to 52 startups, such as Innovative Surgical Solutions, a Southfield-based firm that made the finals of the Accelerate Michigan Innovation Competition. These start-ups employ 285 people and the microloans have helped them attract another $16.4 million in outside investment.

The future of the Michigan Pre-Seed Capital Fund is up in the air. Officials from the state of Michigan's 21st Century Jobs Fund have not yet decided whether to invest in the Michigan Pre-Seed Capital Fund this year. The first loans aren't due to be paid back until next year, so its future is in limbo for 2011.

The Michigan Microloan Fund was the first of its kind, proving quite popular. It inspired a number of similar-yet-smaller funds across Metro Detroit. However, those funds each measure about six figures in size and are focused on specific municipalities. Skip Simms, interim CEO of Ann Arbor SPARK and administrator of the Michigan Microloan Fund, believes these newer funds aren't big enough to make up for the potential loss of the Michigan Pre-Seed Capital Fund, which is by far
the largest of the funds in the Ann Arbor SPARK-run Michigan Microloan Fund pool.

"They're not that large of funds," Simms says. "For instance, our $275,000 fund for Ann Arbor is a nice fund but the demand is 4-5 times that."

The smaller funds also aren't as flexible as the Michigan Pre-Seed Capital Fund. Each of those is specifically set up to provide financing to start-ups in specific municipalities. The Michigan Pre-Seed Capital Fund can make microloans to any in-state start-up.

Source: Skip Simms, interim CEO of Ann Arbor SPARK
Writer: Jon Zemke

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

Accelerate Michigan showcases state's new economy future

One phrase came to mind when summing up the Accelerate Michigan Innovation Competition -- the future.

The new event showed off start-ups that organizers hope will be the future long-term leaders in Michigan's new economy to what they hope will be future near-term investors. The event was held in the University of Michigan's new North Campus Research Complex and
featured Michigan's future governor as its keynote speaker. Future Michigan Economic Development Corp head Michael Finney even hinted at bigger prizes for the next Accelerate Michigan competition in the not-too-distant future.

"We're looking forward," Finney said during his remarks at the event. "We're looking at where we're going to go in the next 3-4 years in this state."

The potential of those next few years looked pretty good on stage last Saturday when the 10 finalists made their pitches. Metro Detroit had a healthy contingent among them, including Southfield's Innovating Surgical Solutions, Madison Heights/Ann Arbor's Gravikor, and a number of firms from Ann Arbor. Bloomfield Hills-based ENRG Power Systems, Troy-based MatchRX, and Farmington Hills-based CSquared Innovations each won $25,000 in the Advanced Transportation, Information Technology, and Next Gen Manufacturing categories, respectively.

Kalamazoo-based Armune BioScience (a U-M spin-off) and Arbor Photonics of Ann Arbor took first ($500,000) and second ($150,000) places. Four start-ups from U-M students swept the student competition and its $60,000 in prizes. In addition to the prize money, most of the entrants raved about the exposure to potential investors that the Accelerate Michigan competition provided. To many of them it was an opportunity to expect a brighter future for their start-ups.

"We have a very bright future," Gov.-elect Snyder said during his speech. "We just need to execute now."

Sources: Accelerate Michigan Innovation Competition; Michael Finney, former CEO & president of Ann Arbor SPARK and current head of the Michigan Economic Development Corp; and Rick Snyder, governor-elect of Michigan
Writer: Jon Zemke

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

Boston entrepreneur impressed by SE Michigan's biz-development unity

Alden Zecha left Ann Arbor this weekend impressed not only with the Accelerate Michigan Innovation Competition, but the unity its organizers displayed.

The CFO and strategist made the elevator pitch for Massachusetts-based Sproxil during the finals of the $1 million business plan competition. When all was said and done, Zecha was pleasantly surprised by how well the Business Accelerator Network for Southeast Michigan (Ann Arbor SPARK, Automation Alley, TechTown and the Macomb-OU INCubator) worked together to make it all happen.

"That is fairly unusual," Zecha says. "Usually those competitions are put together by a single entity, frequently an academic institution. (At those competitions) I wouldn't normally see any animosity between organizations. I see a lot of autonomous organizations that are competing with each other."

Sproxil won the $10,000 People's Choice award for its drug-intelligence software. The winners of the grand-prize ($500,000) would have to agree to move to Michigan. Sproxil and its staff of four were ready to do that had they won, but will remain in Massachusetts for now. The $500,000 would have justified the costs of moving, Zecha says.

Source: Alden Zecha, CFO & strategist for Sproxil
Writer: Jon Zemke

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

Angott Medical Products raises $1.5M for breast cancer screening machine

Angott Medical Products is a start-up with a very personal story.

Paul Angott, the president of the Bloomfield-based firm, came up with the idea of a new breast cancer screening machine about 20 years ago when his mother first developed breast cancer. Her death a few years ago prompted the serial entrepreneur to make that new device a reality through Angott Medical Products.

"It was a painful and horrible death for her," Angott says. "She fought breast cancer for 20 years."

Angott Medical Products' breast cancer screener is a non-invasive and radiation-free device that is simple enough that it doesn't require a highly trained specialist to interpret the results. He has secured 40 patents and raised $1.5 million to develop the device. He hopes to finish the first prototype by the first quarter of 2011 and have it on the market by the second quarter of 2012.

The 3-year-old firm employs a team of about a dozen people. That team recently made the semi-finals of the Accelerate Michigan Innovation Competition. Angott hopes to get even further in it next year.

"We thought we did really well," Angott says. "We hoped to make the Top 10 but there was some stiff competition."

Source: Paul Angott, president of Angott Medical Products
Writer: Jon Zemke

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

PR Easy expands media services, plans to double staff

What was considered one of Ford's darkest hours a few years ago turned into the spark that launched PR Easy.

Janak Mehta had been working at the then-struggling automaker when he was offered a buyout in 2007. He took the money and decided to start his own business. Today the Livonia-based Internet marketing firm employs four people and gives work to four more independent contractors.

"I realized I had to focus on marketing," Mehta says. "At the core of every business is PR and marketing."

PR Easy started by focusing on public relations work. It quickly assesses search engine optimization, Web marketing, and social media services. That has allowed PR Easy to double its client base to 35 customers and 12 consulting clients, along with hiring one employee and four independent contractors. Mehta expects to hire another four people next year.

Mehta also started Social Media Michigan in 2008. It now has 70 members and he hopes to start a few more chapters in Michigan next year, with
subsequent further expansion nationwide.

Source: Janak Mehta, co-founder of PR Easy
Writer: Jon Zemke

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

Critical Signal Technologies hires 40, doubles revenue in 2010

Critical Signal Technologies is more than just a business to Jeffery Prough. It's personal.

A health care professional, Prough watched his father spend much of the final years of his life in hospitals. Had today's technologies been available then he could have maximized his time with family and friends. But the personal connection goes even deeper. Prough's elderly mother and a brother are both heart transplant recipients. Each became the inspiration for starting Critical Signal Technologies.

"I fell in love with the concept of aging in place," Prough says. "People thrive and live longer with their loved ones in comfortable surroundings where they feel they have control."

Prough equates the
shrinking will to live to the loss of independence. Home care helps the elderly or disabled to regain some independence, and is often much more cost effective than extended hospital visits or senior citizen homes.

Critical Signal Technologies provides home-monitoring and security technology and services that allows people with failing health to continue to enjoy their home lives. The company Prough founded in 2006 has grown to 125 employees, 450 independent contractors, and a few interns today, mostly in the company's headquarters in Farmington Hills and an office in Massachusetts.

Critical Signal Technologies acquired Link to Life last fall, but has grown primarily organically. The company hired 40 people in 2010, mostly in Michigan, after it doubled its customer base and revenue. It expects to add another 15-20 jobs in 2011 on projected revenue growth of 20-25 percent.

Source: Jeffery Prough, CEO of Critical Signal Technologies
Writer: Jon Zemke

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

MatchRX creates online market for indie pharmacists

MatchRX is one of those start-ups that proves new technologies shouldn't just be aimed at big corporate behemoths looking for both sales and acquisitions.

The Troy-based firm has created a Web marketplace for pharmacists to sell and buy overstocked medications. Think of it as an eBay for independent pharmacists. The company now operates in 28 states and has 600 members across the U.S. It plans to go international in 2011 and expand to 1,500-2,000 customers.

The company launched in February with three people and now employs nine and a handful of independent contractors. It has a couple of job openings right now and expects more in 2011.

"I expect we will be adding people in the foreseeable future," says John Kello, CEO of MatchRX. "They will be in IT, marketing, and compliance."

MatchRX recently made the semi-finals of the Accelerate Michigan Innovation Competition in Ann Arbor. The $1 million contest among startups will announce the finalists just before the event takes place on the weekend of Dec. 11 during the Big Chill hockey game at Michigan Stadium.

Source: John Kello, CEO of MatchRX
Writer: Jon Zemke

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

Lawrence Tech study gives voice to entrepreneurs' needs

Talk to entrepreneurs about what they need the most and the answer is almost always the same -- capital. Lawrence Technological University's new survey on the needs of Metro Detroit entrepreneurs wanted to dig deeper than that.

"We knew what the top item was going to be going into the survey," says Mark Brucki, executive director of economic development and government relations at Lawrence Tech and the principal investigator in the study. "What we wanted to find out is what they needed beyond that."

The recently completed study, the Innovation & Entrepreneurship Needs Assessment Survey, took the entrepreneurial temperature of more than 1,200 people over the last 14 months. They include Michigan-based business owners, investors, entrepreneurs, consultants, business accelerators, employees, and displaced workers. Among the top needs after capital access are: securing new customers, access to market data, assistance with structured innovation, assistance with product development/launches, and short-term advocacy with state and local agencies.

"All of these things are focused on securing new customers," Brucki says.

The final report recommends pursuing a collaboratively-based Center for Innovation and Entrepreneurship that uniquely addresses those needs at the grass-roots level. The U.S. Dept of Commerce gave $70,000 to fund a feasibility study on creating the center, which would connect the dots of the economic development services already available in Metro Detroit and actually fill in the blanks in some spaces.

Source: Mark Brucki, executive director of economic development and government relations at Lawrence Technological University
Writer: Jon Zemke

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

ENRG Power Systems plans 8-10 hires next year

Milton Roye believe the timing is right for the first product of his new startup, ENRG Power Systems.

The Bloomfield Hills-based business is working on a new piece of technology that will allow motorists to retrofit their engines to make them more sustainable. The technology makes the engines more fuel efficient, as much as 15-20 percent for V-8s, and reduces the production of all four major greenhouse gases. Roye sees such a product as having perfect timing in an age where going green is actually going somewhere.

"It wasn't right 10 years ago or even five years ago," says Roye, founder and president of ENRG Power Systems. "It is now."

The 1-year-old company is composed of two people and a network of unpaid volunteers. That team is working with TechTown to finalize its business plan and marketing strategy so it can launch the product next year. ENRG Power Systems is also one of the 50 semifinalists in the Accelerate Michigan Innovation Competition.

Regardless of whether the company wins any of the $1 million in prizes at the statewide entrepreneurship contest, Roye and his team plan to raise $750,000 to $1 million in seed capital over the next year to launch the product in 2011. He plans to hit $1 million in sales and a staff of 10-12 people by the end of next year.

"Our major push now is for the fleet markets," Roye says. "That's where we'll build out our manpower."

Source: Milton Roye, founder and president of ENRG Power Systems
Writer: Jon Zemke

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

W Bloomfield man capitalizes on Internet clips with videoburst

For David Mayer, the sign that an Internet video company was viable came with the debut of YouTube. He knew it was time to start such a company, videoburst, when YouTube's popularity shot through the roof.

"Broadband reached enough people that most people watch video on the Internet now," Mayer says. "YouTube has 30 billion views per month. There wasn't even a YouTube five years ago."

That sort of success has allowed the 2-year-old videoburst to go from Mayer alone to a staff of three employees and four independent contractors. He expects to have a staff of 15 people within the next year as websites demand ever more video material.

The West Bloomfield-based company continues to fill that need, making videos for doctors, cosmetic dentists, plastic surgeons, and industrial companies. Mayer plans to hire an in-house acting troupe to create funnier, improv-style material for its clients who want to attract more traffic to their sights.

"Businesses are recognizing how video can help them enable growth," Mayer says. "It's not just cool to have a video on your website. You can use video to draw people to your website. Video is a huge distinguishing feature for a website. It increases the chances people will stay longer."

Source: David Mayer, owner of videoburst
Writer: Jon Zemke

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

Fanaroo allows fans to put their mark on stadiums

Ever wanted to see your name in lights at a major athletic venue? Fanaroo plans to make that happen for the Joe Sixpack sports fan soon.

Steve Chapman, Giri Gondi, and Jack Nissley plan to launch the website for the 1-year-old startup in December. That website will enable people to put their name or a message into the background of a stadium, such as in the ice at Joe Louis Arena or the end zone at Spartan Stadium.

"The end product is a poster or a picture or a calendar or a personalized notebook for kids," says Chapman, vice president of sales for Fanaroo.

The Beverly Hills-based company recently became one of the 50 semifinalists in the Accelerate Michigan Innovation Competition. Fanaroo has worked out licensing deals with 52 sports organizations, including a number of minor league hockey leagues and Michigan State University. Fanaroo now employs four people and expects to hire another six by this time next year, when it hits $1 million in sales.

Source: Steve Chapman, co-founder and vice president of sales for Fanaroo
Writer: Jon Zemke

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

DataSpeaks builds drug development software, partners with TechTown

Years of intellectual property and software work for major organizations like Parke Davis, Dartmouth College, and Wayne State University led Curtis Bagne to entrepreneurship. He's now putting all of that institutional knowledge to work for himself with a new startup called DataSpeaks.

The 1-year-old firm has created software that helps improve and streamline the drug development process. The Troy-based company has been working with TechTown to perfect the technology, which Bagne expects to roll out soon.

"The patents have been issued and we have software that is ready for demonstrations," says Bagne, DataSpeaks' founder and chief science officer. "We don't have a commercially ready product quite yet."

DataSpeaks' business plan calls for landing some seed capital over the next few months so it can finish perfecting its new technology. Within the next year, he hopes to have signed on some pharmaceutical companies to test it out and begin developing it to help with doctors' switch to electronic records.

"I'd like to get some key companies and individuals involved with advancing the technology," Bagne says.

Source: Curtis Bagne, founder and chief science officer for DataSpeaks
Writer: Jon Zemke

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