The Michigan Economic Development Corporation has announced the Tech Startup Stabilization Fund—a $3 million fund that will provide capital and support for Michigan tech startups impacted by the COVID-19 pandemic. ID Ventures is administering the fund and accepting applications from tech startups across the state at TSSFund.com. The fund will provide loans and investments ranging from $20,000-$200,000 based on the startup’s sector, stage, estimated runway, and demonstration of need, with a typical investment of $50,000-$100,000. Investments typically will be in the form of convertible notes, based upon the valuation in the business’ current funding round or using other reasonable valuation methods. There is currently no application deadline. Applications will be accepted on a rolling basis and the fund is expected to remain open for application over the next 12 months.

Eligibility requirements:

• Headquartered in Michigan with the majority of employees located in the state
• Early-stage technology and innovation businesses, less than 50 employees
• Aimed at “technology-based start-ups”—companies building tech-based solutions and products (software, hardware, advanced materials, life sciences) or tech-enabled companies that scale by leveraging technology (e-commerce, marketplaces, etc.)
• Product-oriented, scalable business (not intended for consulting and fee-for-service companies)
• Prior investment from angel or venture capital sources
• Matching angel and/or VC funds are highly encouraged
• Pre-crisis, was on path for next round of funding, with favorable relationships in place
• A strong team that has proven execution capability
• Solid customer value proposition
• Implemented cash preservation measures
• Demonstrates the need for funding within 12 months
• Provides a realistic plan of nine-plus months of runway with funding
• Conveys that company can survive and thrive post-crisis
  
  

To apply or learn more about the Tech Startup Fund, visitTSSFund.com.

Please contactTom Vaughn(313-568-6524),Emphani Aldridge(313-568-6606) or your regular Dykema attorney with any questions. We are here to help you and your business navigate this difficult time.

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