
Techstars to open up shop in Detroit - nwest
http://www.crainsdetroit.com/article/20141210/BLOG007/141219993/techstars-to-open-shop-in-detroit
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valarauca1
As a Detroiter hopefully this will give me a reason to start going downtown.

The current problem with the Detroit Metro area is when ever outside money
comes in. Most the time the offices open in the northern/western suburbs.

I say this because most _high paying_ jobs are in the suburbs. Because that's
where the businesses are. The suburbs are doing well. At first I was very
excited and hoped they'd open relatively close, but all things consider that
wouldn't help the city as much.

~~~
Igglyboo
The only time I ever go downtown is for events at the Renaissance Center and
Cobo Hall. There's really no reason to otherwise, unless you like to gamble.
Pretty much everywhere outside of the immediate area around Cobo is really bad
anyway.

~~~
mklim
> There's really no reason to otherwise, unless you like to gamble.

That's really not true. There's a ton of fantastic restaurants/coffee places
that don't exist in the suburbs (Mudgie's, Slowe's, Great Lakes Coffee, etc),
the Detroit Art Institute in Midtown (including famous works like Van Gogh's
self portrait), a music scene ranging from the big pop stars at Fox Theater to
the up and coming indie bands at the Magic Stick, there's all the sporting
events, there's ice skating at Campus Martius during the winter and free music
at Grand Circus during the summer, there's the Opera House, there's touring
Broadway shows at the Fox, there's smaller but still professional theater at
the Hillberry, and there's a few regular tech meetups that take place downtown
(Detroit Google Developer's Group, Lambda Lounge, Detroit Craftsman's Guild).
There's almost always something going on in the Downtown/Midtown area.

~~~
emcrazyone
The other problem Detroit has is the freeways. I fail to understand why I-75
in the middle of the downtown area goes down from 4 lanes to 2 lanes of
traffic. Boggles the mind. I've learned to avoid the area during major events
because the freeway turns into a parking lot down there.

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ryanmarsh
As a Houstonion this gives me pause. Houston is a massive economic center by
nearly every measure. It is also home to the most diverse county and
university in the US. There are large successful technology companies here.
Yet, Detroit and Dallas (arch enemy of Houston) are getting TechStars before
us.

Part of the reason we don't attract accelerators like TechStars is the lack of
a healthy startup ecosystem. I am NOT saying that the well intentioned
community organizers aren't working hard. It's just that most of the VC here
goes to Oil & Gas projects. If your tech isn't energy related it won't hit the
radar. The technology startup successes I've seen in my 30 or so years here
were built inspite of a (nonexistent) local startup ecosystem. Lastly, 9 out
of 10 great people I've worked with here have left to go places with more tech
opportunity. The talent is voting with its feet. Frankly, I'm done too. I'm on
the first airplane out of here once I get my feet under me. I'm sad that it
has to be this way. Maybe if I make it rich I'll come back and invest.

edit: spelling

~~~
saryant
I have to agree. I love Houston but I left it for San Antonio because the tech
scene in SA was much more lively with Geekdom and Techstars. Though I'm now in
Boulder I've been keeping in eye on SA and there's a lot of cool stuff going
on there, plus the VC activity has really picked up—multiple $1+ million
rounds have been announced or will be announced in the next few weeks.

~~~
mgirdley
As a San Antonio VC (GeekdomFund.com), I hope you come back.

~~~
saryant
Hi Michael.

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phkahler
While this is great news, I think YC-Detroit would have been even better ;-)

There is a lot of talent here. As evidence, here's the First Robotics
Competition team map:
[https://www.google.com/maps/d/viewer?mid=zIJNq656OeBY.ke6fB8...](https://www.google.com/maps/d/viewer?mid=zIJNq656OeBY.ke6fB8FLJTDI&ie=UTF&msa=0)

Our teams also have a long history of winning ;-)

~~~
yesimahuman
While YC is a wonderful program, I think it'd be nice to give some props and
support to programs like TechStars that are actively expanding and supporting
startup cities outside of the valley.

~~~
phkahler
I completely agree. It's just that YC kinda has a reputation as being #1 at
least for the kinds of startups they do. Either way, Detroit (or the Detroit
area) has been overlooked IMHO and this is still a great thing to see.

~~~
yesimahuman
Yep, I would love to see YC expand beyond the valley (drawing a bit on their
east-coast past), though I can't blame them for focusing there.

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ThomPete
I have said it before and I will say it again.

Detroit is the perfect place to build the robotics industry and they should
call it Uncanny Vally.

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dominotw
>Detroit is the perfect place to build the robotics industry

Why?

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valarauca1
Mechanical and Technical engineering base of the city already exists.

The automotive industry has already created a host of general consulting
engineering companies specializing in everything from hydraulics to
electronics to fluid flow is insane.

One area of the city is literally known as "automation alley" due to the huge
number of PLC controlled robots it produced in the 80's and 90's.

The ideas of line automation were invented in Detroit.

Also the exposure the metro-area children get to this technology is
unpresendented. While HN doesn't seem to be "big" on First/FRC high school
robotics competition. Nearly every school in the suburbs has a team that
builds at least 1 50k+ robot per year to compete locally. There are multiple
programs and competitions FIRST isn't the only. I bring this up because
Michigan teams don't exactly compete but dominate was a better word before the
region limiting system was put in place.

Finally the education system is also in place. Lawerence/Kettering university
were founded by Ford and GM as trade schools to crank out engineers for their
companies, now they're private universes. But the it demonstrates just how
many engineer degrees come from the state let alone the metro area.

~~~
jcastro
Hey I judge at First every year! You're right that the amount of engineering
prowess (and willingness to go into engineering) is really high, but for some
reason the area is never mentioned among the heavyweights for some reason.

Oakland U also has (or had) a decent engineering program, no idea how it's
coming along these days though.

~~~
phkahler
OU is still hosting the annual AUVS intelligent ground vehicle competition -
autonomous vehicles. My team took 2nd place back in 1994. Yeah Google, we've
been doing that stuff for 21 years. They're also building another engineering
building.

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alexalex
If true and successful, this would be huge for Detroit.

I once looked into the suitability of Detroit for a start-up. It seemed that
professional services were generally not as interested in working with young
companies as in the bay area. The availability of deferred legal, accounting,
or other services was non-existent. Being in the bay area, my company has
benefited greatly from having deferred legal work. I also worried about
finding good advisers.

With Techstars there, it would definitely solve these problems for their
awardees.

While there aren't a wealth of affluent, urban customers in the city, there
would be great opportunities for consumer or educational startups that address
problems for the base of the pyramid. Whole Foods opened a store in Detroit,
and talked more about it in their last quarterly conference call than any
other topic. Ostensibly, figuring out how to be successful in markets like
Detroit is a huge opportunity for growth for them. Finally, the city of
Detroit has neighborhoods that are young and affluent. Inventory is very
limited, and rents in the highest profile areas are as high as most big cities
-- think Lake Merritt in Oakland.

I really hope TechStars is successful there. Detroit is a place dear in my
heart and not as scary as many think. I lived in SF's SOMA 10-ish years ago,
and can say that I had way crazier stories and more dangerous moments than my
mom, who has been working in Detroit Public Schools since her retirement.

~~~
calbear81
Although I'm glad Whole Foods is in Midtown, it's not catered towards the
"base of the pyramid". Every time I've been in there, the customers are
primarily the hip newcomers who have moved to Midtown or folks from Oakland
county coming in to catch an exhibit at the DIA or symphony. I would love to
see development happen in the areas that need it more and not just in the
rapidly gentrifying downtown core.

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bruceb
There is already at least one accelerator in Detroit.
[http://bizdom.com/](http://bizdom.com/) It is partially funded by the Dan
Gilbert, founder of Quicken Loans. He also owns the Cleveland Cavilers and
partial funds same thing in Cleveland.

Detroit is cheap compared to SF but actually downtown is filling up, rents are
not as cheap as you might think.

~~~
rezistik
He's also invested in Detroit Venture Partners

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drawkbox
Happy for Detroit, I think there is a responsibility of tech leaders to get
this throughout our nation not concentrate it, no single point of failure,
plus more input from different areas means better products + systems which are
more robust.

However, when is someone going to setup in Phoenix (Chandler, Scottsdale,
Tempe)? Huge market, short flight to CA, always overlooked. Gangplank
(web/app/product), Game Co-lab (games) co-working locations + ASU are doing a
good job for startups but it would be awesome for more investment here, fairly
untapped and a blue ocean in the desert where we have to stay indoors working
most of the time anyways.

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johnvschmitt
Great news & I have more hope for the community.

However, many people outside of the startup scene have misconceptions, as they
see survivor bias/success bias in the reporting. One item in the report feeds
this misconception: "The average company got $1.9 million in funding." The
median raised would be far more revealing of the actual experience that a
startup faces than the average.

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cj
Techstars is incredibly transparent with their stats. Full funding data
available here:
[http://www.techstars.com/companies/stats/](http://www.techstars.com/companies/stats/)

I just pulled some numbers quickly...

In the last 3 Techstars NYC batches (not including the most recent), there
were 37 companies with median funding of just over $1.6 million. 28 are still
active, 6 have been acquired and 3 have failed.

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johnvschmitt
Thanks. That is indeed an incredible level of transparency. I didn't see a CSV
download but just scanning, it looks like it's more like a $200k median, with
1.6M average. Medians just make far more sense in letting someone outside the
system know what to expect. Just like, "The average actress in Hollywood makes
$250k, when in fact the median is $30k and a few make $100M).

~~~
cj
They don't have a CSV export, but here's a quick Javascript script that pulls
the fundings and calculates the median and average.

Total companies: 486

Median funding: $450,000

Average funding: $2,039,918

Total funding: $991,400,000

    
    
      var fundings = $('.batch .parent .right').map(function(){ 
        return +this.innerHTML.replace(/(\$|,| )/g, '') || 0;
      }).toArray();
    
      fundings = fundings.sort(function(a, b) { return a - b; });
    
      var totalFunding = fundings.reduce(function(a, b) { return a + b; });
    
      console.log('Total companies: ', fundings.length);
      console.log('Median funding: ', fundings[Math.round(fundings.length / 2)]);
      console.log('Average funding: ', Math.round(totalFunding / fundings.length));

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youssifa
If you're a startup founder accepted into Detroit Tech Stars (or even a YC)
who lives in a foreign country, there should be a policy in place to give you
an accelerated visa to work / live in the US provided you base your startup
out of Detroit. Could be a good policy experiment on urban renewal.

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marksc
This is great news!

Though, I'm surprised they aren't coming to Ann Arbor- the real startup hub of
Michigan.

~~~
rezistik
I live in Ann Arbor, and I've worked at a start up in Detroit, in what world
is Ann Arbor the start up hub?

Detroit has far more start ups and venture capital firms...mostly
owned/invested in by Quicken but the point stands.

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jasallen
If you worked at a start up in Detroit, you were defacto a part of the Gilbert
Mafia. I don't say that disparagingly, Dan Gilbert crew have done great things
for the city, but its a one shop town.

A2 lacks a Dan Gilbert to make all the things happen, but it has a much more
vibrant, Bay-like share-and-share alike, encouraging, open start-up culture.

Plug for A2-NewTech, a start-up meetup I'm a huge fan of (I'm not affiliated,
just a fan)

~~~
rezistik
I'll have to check out A2-NewTech. It's awesome to know I've been wrong about
my (new) home town.

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borat4prez
How do I apply my Detroit area startup? The application on the website is only
for Austin.

~~~
mooreds
They have rolling applications, so each city has a different application
period. Also, they probably won't take applications until the official
announcement.

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iwantagrinder
Gilbert's plan is working.

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azilnik
Does anyone else feel like Detroit is going to be an attractive place for
young tech folks to start their businesses in the next 10 years?

Are there any Detroit-centric REITs out there?

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chandrew
Hello from the Techstars office, Austin.

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monsterix
I wish there was something like this here in DC. Very little startup scene.
All I get to see are those sweettalk recruitment shops and those three
lettered agencies that I couldn't imagine working for.

Good news for you Detroit!

~~~
ryanSrich
I had the complete opposite experience in DC. There are a TON of startups in
DC. Far more than where I live now (Portland OR).

You should checkout über offices. They have 5-10 startups working out of all
three locations (most of with funding). On top of the co-working/startup
spaces you have other accelerators and funding opportunities like 1776 and
Acceleprise.

The DC startup scene is definitely healthy.

