StockX buoys record year in Detroit venture capital, report finds
In the 2020 pandemic, two dozen Detroit startups raised over $ 316 million in venture capital funding.
This is one of the findings of a report released Monday morning by EntryPoint, an Ann Arbor-based nonprofit that focuses on entrepreneurial research.
The $ 316.5 million VC funding for Detroit companies is a massive increase from the $ 64 million that 19 companies raked in in 2019. However, Detroit-based e-commerce company StockX skews the numbers a bit based on its $ 275 million grant late last year. which was followed in April this year by an increase of $ 255 million at a valuation of $ 3.8 billion.
StockX’s two venture capital increases are by far the largest in the history of the state’s venture capital, with the next largest being the $ 77 million increase in 2019 by Kalamazoo-based Ablative Solutions.
Among other notable findings in EntryPoint’s 2021 Detroit Entrepreneurial Ecosystem Report:
- Wayne County startup companies raised a total of $ 806.3 million in venture capital funding, an increase in total capital of 333 percent over the past seven years.
- There are 38 venture-backed startups in Wayne County, a 58 percent increase in the number of startups over the past seven years.
- Last year, 24 Detroit area startups attracted more than $ 316.5 million from venture capital firms, nearly five times the amount raised the previous year.
- Ten venture capital-funded startups headquartered in the city of Detroit are led by a CEO who is a Person of Color. These companies raised 1.5 percent of the total venture capital raised by startups in the city last year.
“Detroit’s entrepreneurial ecosystem has seen incredible growth over the past seven years. However, our research shows that the challenges facing the region, such as racial inequality and the global pandemic, have hit the community hard over the past year, “EntryPoint founder and CEO Emily Heintz said in a press release. “We hope that through extensive and ongoing research we can do our part to support the community as it continues to grow and progress.”
Of the 24 startups that received venture capital investments in 2020, 67 percent are IT companies and 21 percent are life science or healthcare companies.
According to the report, the remaining companies are spread across the sectors of mobility, consumer goods and others.
A report by Crunchbase News last month found that Michigan venture capital investments rose 886 percent between 2016 and 2020, by far the strongest in the country.