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Personal tragedy inspires launch of U-M spin-out, Neurable

Making the world a better place is the kind of warm and fuzzy rhetoric tech entrepreneurs use when launching their new startup.

Ramses Alcaide wants to make the world a better place, too, but his inspiration comes from personal experience.

The University of Michigan PhD candidate is dedicated to developing technologies to assist people with physical disabilities because he witnessed first-hand the challenges of living with such disabilities. In particular, the hardships that faced his favorite uncle. That uncle, also a scientist, suffered an accident that immobilized his legs when Alcaide was a young man. His struggles stuck with the U-M grad student.

"I remember seeing him struggle to relearn how to walk with the archaic technology of the time," Alcaide says. "I thought there has to be a better way. But I had no idea what that was."

Those memories served as the inspiration for Alcaide's post doctorate studies and a new startup called Neurable. The University of Michigan spin-out is developing a non-invasive brain-computer interface that allows for real-time control of software and physical objects, allowing people to control wheelchairs, robots and even a car with no training.

Neurable currently has a working prototype of its technology and is working toward commercializing it next year. The startup aims to raise $500,000 in seed capital to make that happen and more.

"We have much bigger dreams," Alcaide says. "We want to make it into a full-fledged company."

It's off to a good start. Neurable, with the help of U-M's Zell-Lurie Institute, took second place in the Rice Business Plan Competition. That gave it $50,000 in seed capital, as well as up to $280,000 for the competition's OWL Investment Prize.

"I really wanted to bring this technology to the next level so I can help as many people as possible," Alcaide says.

Source: Ramses Alcaide, founder & CEO of Neurable
Writer: Jon Zemke

PreDxion Bio's tech helps tailor treatments to patient's immune system

The team at PreDxion Bio isn't just trying to come up with new technology to help sick people. It's trying to help really really sick people. The University of Michigan spinoff is in the early stages of developing a diagnostic device to help create custom diagnosis. The technology is coming from U-M's Pediatric Critical Care Precision Laboratory.

"One of the main thrusts of our lab is to develop new diagnostic tools to treat these really sick patients," says Walker McHugh, co-founder of PreDxion Bio and a biomedical engineering graduate student at the University of Michigan. He is launching the startup with Dr. Timothy Cornell, a physician at U-M, and Caroline Landau, an MBA student at U-M's Ross School of Business.

PreDxion Bio's technology is a patent-pending diagnostic device that gives doctors the information they need to precisely tailor treatments to a specific patient's immune response. The idea is to make precision care more available to people in intensive care.

The team has created a prototype and is currently entering it into a variety of high-profile business plan competitions. It is one of two U-M startups to make it to the Rice Business Plan Competition next week where it will compete for $1 million in prizes.

The company plans to use any winnings from business plan competitions and any seed capital it can raise to develop a next generation version of its technology that will be manufacturing grade. It hopes to then submit it for clinical trials that will eventually lead to FDA approval in 3-5 years. In the meantime PreDxion Bio's team is looking for interested parties to help it get to the next step.

"We're talking with strategic partners," McHugh says.

Source: Walker McHugh and Caroline Landau, co-founders of PreDxion Bio
Writer: Jon Zemke

Detroiter invents cooker that makes diabetic-friendly rice

Swad Komanduri isn't trying to reinvent the wheel with his first startup. He's just trying to reinvent the rice cooker.

Komanduri came up with the idea after his father was a diagnosed with diabetes. His father is a vegetarian who eats Indian dishes composed mainly of rice, which his doctor suggested he cut from his diet.

The Komanduri family had a better idea. Instead of preparing the rice in traditional cookers, they started cooking the rice al dente, so it's still slightly firm. The end result is a significant reduction in its glycemic index -- as much as 30 percent. Within a few months, Komanduri's father returned to pre-diabetic health levels.

"It immediately improved my dad’s health," says Komanduri.

But cooking rice in a pot requires some maintenance. Given his family's proclivity for the grain, that added up to a couple of hours each day of watching rice cook.

"You can't just put it on the oven and go to the gym," he says.

So Komanduri, who worked in robotics in high school and got an engineering degree, started to tinker.

He is also a fellow with the 2014 class of Venture for America in Detroit. The nonprofit pairs promising college graduates with startups in economically challenged areas like Detroit in search of talent. Komanduri has spent the last two years working for NextEnergy and is nearing the end of his fellowship. He had been weighing different opportunities to launch his own company, and then the rice cooker idea popped into the center of his family’s life.

Komanduri launched a crowd-funding campaign to produce the initial prototypes with an eye on commercializing them within the next year. He hopes to raise $5,000.

Source: Swad Komanduri, founder of Simple Kitchen
Writer: Jon Zemke

Sidewalk Ventures works to connect businesses with local investors across Michigan

Sidewalk Ventures spent its first year helping a local entrepreneurs connect with local investors, but now the Midtown-based company is looking to spread its business model across Michigan.

"It's been a year of educating people and helping people across the state understand what this new phenomenon is," says Jeff Aronoff, principal at Sidewalk Ventures.

Sidewalk Ventures, which calls the Green Garage home, bridges the funding gap for small businesses looking to get their ventures off the ground. The firm pairs clients with local investors to create community-based investment and a smart profit to their backers.

The 1-year-old company helped Sister Pie, a seasonal baked-goods company, lock down five figures of investment last year. The money, which came from local investors, helped Sister Pie secure its retail location in West Village, giving it space for future growth. Sidewalk Ventures is also helping the Detroit City Football Club raise hundreds of thousands of dollars to renovate its new stadium in Hamtramck.

"The investment deal will be open until the middle of February," Aronoff says. "It will be between $400,000 and $750,000. We have already raised $360,000."

Aronoff is currently working to attract more potential small businesses from across Michigan. It's also looking to attract more community organizations, like downtown development authorities, to help it make inroads in neighborhoods across the Great Lakes State.

"This is a tool that can be used by anybody in the state of Michigan," Aronoff says.

Source: Jeff Aronoff, principal at Sidewalk Ventures
Writer: Jon Zemke

Go! Ice Cream targets opening own shop in downtown Ypsilanti

Rob Hess has a dream, a dream that includes opening up a new ice cream store in downtown Ypsilanti. And he would like your help to make it happen.

The Ypsilanti resident has launched a crowdfunding campaign to help him finance the opening of the first permanent home of Go! Ice Cream. Today the fledgling business that makes craft ice cream is sold from the cooler of his tricycle and at the events he caters. Hess aspires to open an ice cream store at 10 N Washington, activating a vacant storefront and deserted alley in downtown Ypsilanti.

"I searched high and low for the right place," Hess says. He adds he spoke to local developer Stewart Beal and other local stakeholders to find the right spot. "I really want a space in downtown Ypsilanti. When you walk through downtown you can see a lot of vacant storefronts."

And that means opportunity for Hess. He has raised a little more than $6,000 of his $30,000 goal as of Tuesday afternoon. If Hess raises the money he plans to have the kitchen ready by early next year and the storefront open to the public by May.

Hess got started making ice cream as a hobby a few years ago. Check out a previous feature on Go! Ice Cream from Concentrate here. The videographer at the University of Michigan quickly got sucked into the craft of making ice cream.

"I got interested in the chemistry behind it," Hess says. "You can do a lot of subtle things to tweak the texture and flavor."

Soon he had a freezer full of his homemade ice cream and no room for any of his vegetables. So he started giving it away to friends and family. They started offering to pay him for it and the entrepreneurial light went off over his head. He started working with Zingerman's, which agreed to pasteurize the ice cream for him, and he had a real business on his hands.

"Once I figured that out I thought, 'Let's see if people will respond to $9 a pint ice cream?'" Hess says.

They responded well. Hess, an avid bicyclists, bought a tricycle to sell Go! Ice Cream's flavors across the city. He now sells ice cream to about 700 people per month and growing. He hopes to grow that number even faster when he has his own store where people can come to him.

Source: Rob Hess, owner of Go! Ice Cream
Writer: Jon Zemke

How Beezy's, Beal made the numbers work to grow in downtown Ypsilanti

News that a local entrepreneur (Bee Roll) and developer (Stewart Beal) are partnering to expand a popular business in downtown Ypsilanti (Beezy's Cafe) is rightly being celebrated. It's the type of move that passersby would say, "That makes so much sense. Why didn't it happen earlier?"

Normally, the problem of filling empty storefront A with growing local business B is a lot easier said than done. Roll and Beal figured out a way to make the numbers add up.

"This is what I would call Ypsilanti hustle," Beal says. "We are both going to work really hard to make this work."

Beezy's Cafe has become an Ypsilanti institution in the seven years since its opening, serving soups, sandwiches and other delicious food to a growing clientele. Despite its success, finding capital to grow has proven difficult, to put it nicely. (You can read more in-depth writing about those challenges here. Roll recently signed Beezy's Cafe up as one of the early adopters to ZipCap to leverage a $10,000 loan. More on that here.)

Last week Beal purchased the former Club Devine building at 21 N Washington St. The vacant structure also happens to be across the street from Beezy's Cafe current home. Beal and Roll plan to expand Beezy's Cafe into 3,000-square-foot of the former Club Devine space later this year or early next year. That space includes a 800-square-foot commercial kitchen, which is four times the size of Beezy's Cafe's current kitchen. It should give Roll ample room to keep up with demand for both her eatery's breakfast, lunch and dinner items, and its catering service.

"I just hope to have the kitchen operational so that I can produce food in a little more space," Roll wrote in an email. "That will potentially raise enough revenue to feed the rest of the growth and keep up with existing bills."

Roll is paying $2,500 a month for the new space of Beezy's Cafe, which include $30,000 worth of improvements Beal is making to the space and rolling into the rent. That comes to a price per square foot that Beal describes as the minimum a commercial property can charge a business and still maintain its status as a functional property that can make further improvements. Beal adds that he has been talking to Roll for years about her business and knows she was looking at expanding into an adjacent property that required at least $150,000 buildings updates. The problem so many retailers like Roll run into is they see empty storefronts in a dynamic downtown like Ypsilanti and then realize they need tens of thousands of dollars in upgrades that the landlords have no interest in making.

"In Ypsilanti the reason buildings are vacant in because the the owners of the buildings don't want to invest in the building to land a tenant," Beal says.

The former Club Devine building was move-in ready. Beal says his development team only needs to put down a new floor in an otherwise pristine space. Which is part of the reason why Beal wanted to move a tenant into 21 N Washington right away. For him it makes sense to bring in an popular business like Beezy's Cafe at an affordable price to anchor his new commercial development.

Beal is now working to fill the second floor and basement of the 22,000 square foot building. He is considering turning the second floor into either an office space or residential lofts, and hopes to fill it within six months. He knows filling the basement will be more of a challenge and hopes to find the right tenant for it in the not-too-distant future.

"She (Roll) brings the fan base and we get the space ready for her to make it work," Beal says.

Source: Stewart Beal, owner of Beal Properties; Bee Roll, owner of Beezy's Cafe
Writer: Jon Zemke

Lazlo employs returning citizens to make sustainable clothing

T-shirt companies are a dime a dozen in Detroit, but Lazlo, a new company in Corktown, is working to set itself apart from that pack.

Brother and sister partners Christian and Kathryn Birky are doing so by employing formerly incarcerated Detroiters to make high-end, socially conscious t-shirts and paying them a living wage.

"A large portion of the prison population ends up back in prison after it gets out," Christian Birky says. "There are many reasons for this, but the difficulty in finding a job is part of it."

Christian Birky spent time working as a tutor in a prison in New Jersey before starting Lazlo. He knows there is a large pool of untapped potential in that section of the population that only needs a pathway to success, which to him includes a well-paying job.

The Birky siblings think they can provide that by making high-end clothing in Detroit. Lazlo's first product is a white t-shirt. The Birkys are using high-end, organic cotton produced in America to make shirt, which is designed to better fit each user and comes with a life-time guarantee. Prices start at $120 and top out at $198.

"I was looking for clothing I wanted to wear made in a way that I wanted to support," Christian Birky says. "There was a disconnect between what I was wearing and the values I held in my life."

The Birkys plan to expand their product line into more menswear items by next year. They also want to expand their production team to 10 people by next year. In the meantime they are working to raise $27,000 in a crowdfunding campaign to get their venture off the ground.

Source: Christian Birky, co-founder of Lazlo
Writer: Jon Zemke

Wayne State student re-invents the crossbow, launches a company

A recent Wayne State University graduate is launching a new business based on his invention, a new-and-improved version of the crossbow.

Adam Skornia graduated from Wayne in December with a bachelor of science in mechanical engineering, but he never played video games until he went to college. Those hours spent in front of a screen playing first-person shooter games inspired him to invent a patent-pending design for a new crossbow.

After a couple of years fiddling with the design, the idea started to become real.

"I started thinking this could happen -- this could be built." Skornia says.

The crossbow design allows the bowstrings to run internally, prohibiting fingers from coming across the path of the strings. The design is safer, more efficient, and compact. It is just shy of 3 pounds, about half the weight of the typical crossbows.

Skornia launched Skore LLC to commercialize his invention. He has a prototype after working with Wayne State's Blackstone LaunchPad program. The company recently won $5,000 in seed capital from Wayne State's Blackstone LaunchPad Warrior Fund Competition. That money will be put toward getting the Skore crossbow to the market.

"I want to start off in Michigan," Skornia says. "This is a Michigan-based company and I am big on Michigan-made products."

Source: Adam Skornia, founder of Skore LLC
Writer: Jon Zemke

Ann Arbor startups claim lion's share of Michigan Pre-Seed Fund

Ann Arbor-based startups are taking the lion’s share of the new early stage seed capital from the Michigan Pre-Seed Fund 2.0.

Promising small businesses from Tree Town made up three of the last five recipients from the fund. Ann Arbor-based ventures have also comprised 10 of the 18 investments made so far.

"The recent activity has been concentrated in Ann Arbor," says Charles Moret, president of Invest Michigan, which manages the Michigan Pre-Seed Fund 2.0. He adds that there are plenty of other promising startups at the front of the line for funding, including several from the west side of Michigan and Metro Detroit.

Invest Michigan launched a little more than a year ago and currently employs a staff of four people in downtown Detroit. It oversees the Michigan Pre-Seed Fund 2.0. The $5.8 million fund is capitalized by the Michigan Strategic Fund, which is administered by the Michigan Economic Development Corp.

The Michigan Pre-Seed Fund 2.0 makes small investments ($50,000 to $150,000 in a convertible note or equity investment) in early stage startups looking to rapidly grow their businesses. All companies that receive funding are required to secure a minimum of 1:1 in matching co-investment funds. Some of the industries it is targeting include automotive, agriculture, alternative energy, defense, IT, and life sciences. Startups that do well can receive a follow-on investment worth up to $500,000 from the fund.

"Our strategy in Michigan is to enable investors to pool their money together to support early stage startups," Moret says.

The most recent companies to receive funding include ENT Biotech Solutions, NanoRETE, Arborlight, Cribspot and Picospray. The last three are based in Ann Arbor. Arborlight makes architectural lighting that mimics daylight. Cribspot serves as clearinghouse for rentals on and near college campuses. Picospray is developing technology that makes small engines more fuel efficient and produce fewer emissions.

Moret expects to make another 10-12 investments in Michigan-based startups before the end of the year.

"We have funding for the next two years if we maintain our current pace," Moret says.

Source: Charles Moret, president of Invest Michigan
Writer: Jon Zemke

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

FreeStride Therapeutics scores win at Accelerate Michigan, adds positions

FreeStride Therapeutics won the Life Sciences category at last month's Accelerate Michigan Innovation Competition.

The win came with a check for $25,000. The Ann Arbor-based startup, which is repurposing a human drug for veterinary purposes, made a number of connections with investors and fellow entrepreneurs at the four-day business plan competition in downtown Detroit.

"It was a generally rewarding and a literally rewarding experience," says Michael Long, CEO of FreeStride Therapeutics.

FreeStride Therapeutics is developing a drug that relieves and even prevents shin pain for racing horses. It even has implications for companion animals, like dogs and cats, suffering from arthritis. The startup is working on raising $1 million in a Series A to complete the final two studies necessary to bring it to market. The $25,000 from Accelerate Michigan will go toward that effort.

"We'll probably be able to close on that by the end of the year or early next year," Long says.

The three-person company plans to raise a Series B after it starts to generate revenue for its technology. That money will go toward overcoming the final hurdles on the way to FDA approval.

"We'll have a very good understanding of what the market wants from us," Long says.

Source: Michael Long, CEO of FreeStride Therapeutics
Writer: Jon Zemke

U-M student-led VCs look for a few good startup investments

Opportunities for finding seed capital for local startups are anything but in short supply this fall. A broad range of financial sources are looking to invest tens of thousands of dollars in promising ventures, such as the University of Michigan’s Social Venture Fund and the Accelerate Michigan Innovation Competition.

Three student-led venture capital funds at the University of Michigan are putting out calls for applications. The VCs are looking to sink $50,000 to $100,000 per investment, and they are looking for a broad range of startups to evaluate.

"We invest in 1-2 companies per year," says Joanna Herrmann, director of investments for the University of Michigan’s Social Venture Fund. "Last year we invested in two companies."

The other two student-led funds (the Wolverine Venture Fund and the Zell Lurie Commercialization Fund) are looking to make investments of similar sizes in a wide variety of ventures.

This is the fifth year for the university's Social Venture Fund. It has made five investments in that time, including an investment in downtown Detroit-based software mapping startup Loveland Technologies, which has hired three people in recent months. The Social Venture Fund looks for companies that are for-profit and aim to make a social or environmental impact.

"We try to cast a really wide net," Herrmann says.

Bigger money is at stake at the Accelerate Michigan Innovation Competition this fall. The annual business plan competition offers prizes that are often worth $10,000 or more. Top prize is $500,000. Startups from Washtenaw County, and the U-M specifically, have historically fared quite well, often taking the top spot and walking away with six figures in seed capital. For information this year’s Accelerate Michigan Innovation Competition click here.

Source: Joanna Herrmann, director of investments for the University of Michigan’s Social Venture Fund
Writer: Jon Zemke

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

Venture for America fellows launch video production firm TernPro out of Bizdom

Brian Bosche came to Detroit two years ago as part of the inaugural class of Venture for America, a two-year program that pairs talented college grads with startups in economically challenged cities. Bosche ended up working on the leadership team at Bizdom and noticed a common challenge all of the entrepreneurs in the program were facing.

"They all struggled to tell their story," Bosche says. "Especially with video because video is really hard."

That inspired Bosche to start TernPro, a full-service video production company. Along with Venture for America fellow Dan Bloom, Bosche launched the company earlier this year. TernPro is currently going through Bizdom's startup accelerator program, but is already producing videos for a variety of clients, including Come Play Detroit, Quicken Loans, and Grand Circus.

"[We do] everything from real-estate to travel, both in Detroit and across the country, as well." Bosche says.

That workload has allowed TernPro to hire two employees and bring on an intern. Bosche expects to continue adding staff this year, possibly bringing the firm’s intern on as a full-time employee.

TernPro is also developing a video creation platform so everyday people can produce videos and track the public's interaction with them. Bosche hopes to have a Beta version of the comprehensive video creation platform up and running by next year.

"That entire process is one I’d love to have on one platform," Bosche says.

Source: Brian Bosche, co-founder & CEO of TernPro
Writer: Jon Zemke

Livio Radio co-founders launch new tech venture, Tome

Fresh off a successful exit of tech startup Livio, co-founders Jake Sigal and Massimo Baldini are at it again, launching a new venture called Tome out of Ferndale.

"People like to say we're like an old married couple when it comes to business," Sigal says.

Sigal is shy to describe Tome in too much detail but would say its technology is focused on the "Internet of things," a newer term used to describe the movement to connect the power of the Internet with tangible objects. Specifically, Sigal says Tome’s principal product aims to merge mobile apps, devices and services.

"We're looking at the larger issues in the tech industry," Sigal says.

Sigal and Baldini launched Livio Radio in Ferndale, making physical radios that could play Internet radio stations in the late 2000s. The startup evolved to creating software that connected mobile devices with automobiles. Ford acquired the startup, later rebranded as just Livio, last year. Sigal and Baldini left the company soon after but stay connected with its staff and progress.

"We're excited about what Ford is doing with it now," Sigal says.

Tome now has a staff of three people after launching in April. Sigal says it's in "stealth mode" but he did describe it as a non-automotive play that focuses on software. The pair raised a $250,000 angel round that closed in June.

"Our mission right now is to build the right team and the right product," Sigal says.

Source: Jake Sigal, co-founder & CEO of Tome
Writer: Jon Zemke

Social Entrepreneurship Showcase highlights impact investors

Business competitions are becoming increasingly common in Detroit. Three are making their way through the Motor City this summer.

Former AOL CEO Steve Case recently announced that Detroit will be the first stop on his Rise of the Rest bus tour and pitch competition on June 24. The tour highlights up-and-coming entrepreneurial hot spots, showcasing their business accelerators and startups. Each stop will host a pitch competition with a top prize of a $100,000 investment from Case.

Project Startup Live held its business plan competition at TechTown last week. Of the three finalist (Banza, Swaddle-mi-Bili, and Social Sushi), Banza walked away with the top prize of $5,000. The two runners-up each received $2,500. Banza is marketing a pasta made from chickpeas. Swaddle-mi-Bili is developing a wearable fabric that helps babies fight jaundice. Social Sushi works to connect people and ideas through high-quality sushi.

The Social Entrepreneurship Showcase is gearing up to hold an afternoon event on June 20 to promote the participants and winners of this year's Michigan Social Entrepreneurship Challenge. The challenge looks to help grow the local socially focused entrepreneurial community. This year, 280 entrepreneurs and companies are participating from across the state.

"I think more than half of our participants hail from southeast Michigan," says Elizabeth Garlow,  executive director of Michigan Corps, which is organizing the Michigan Social Entrepreneurship Challenge.

She adds that this year's conference will focus on helping grow angel investors and investment funds looking to blend their portfolio with ventures that are socially entrepreneurial. This new class of investor is being branded as an "impact investor" who aims to make a difference while making a profit.

For information on the Social Entrepreneurship Showcase, click here.

Source: Elizabeth Garlow,  executive director of the Michigan Corps
Writer: Jon Zemke

TurtleCell launches iPhone case with retractable headphones

Every time I take my cell phone out of my pocket, I usually have to untangle a small web of earbuds. It’s the type of frustrating process that makes me wonder why I even want to use earbuds to begin with.

The team at TurtleCell believes it has an answer to this problem. The Ann Arbor-based startup is launching a new product, a cell phone case with retractable earphones. It’s not the first time the fledgling startup has tried this. Last year is started floating the idea for the product, even launching an ill-fated crowd-funding campaign.

Then it went back to the drawing board. The actual drawing board. The three-man team redesigned their product, upgraded the headphones, streamlined its business approach. They created a cell phone case (for iPhone 5 and above) they are excited to use every time they take it out of their pocket.

"Every aspect has been improved," says Nick Turnbull, director of business development for TurtleCell.

TurtleCell started taking pre-orders for its first run of products this week. Buyers can get the product for $39.95 (which includes $10 off the full retail price) and expect to have it delivered in October. The company expects to make tens of thousands of its cell phone case in time for the holiday shopping season.

"It's somewhat up in the air but it will be more than 100,000," Turnbull says.

Making all this possible is a successful seed capital round. The company has raised $250,000 from angel investors, allowing it to bypass another crowd funding campaign and just move forward with production.

"We raised almost all of it over the last month," Turnbull says.

Source: Nick Turnbull, director of business development for TurtleCell
Writer: Jon Zemke
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