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2021 Ann Arbor Entrepreneurial Ecosystem: +64% High-Growth VC-Backed Startups in 7 Years

Laura Cowan

By Laura Cowan

Laura K. Cowan is a tech editor and journalist whose work has focused on promoting sustainability initiatives for automotive, green tech, and conscious living media outlets.

EntryPoint, Ann Arbor entrepreneurial ecosystem report, 2021 Ann Arbor startups, 2021 Ann Arbor entrepreneurship

Ann Arbor is home to nearly half of all high-tech startup in the state of Michigan. What's the state of Ann Arbor's entrepreneurial ecosystem after a challenging year due to the COVID-19 pandemic?

EntryPoint has a new report on the 2021 Ann Arbor Entrepreneurial Ecosystem out today if you would like to stay up to date on the latest about Ann Arbor's emerging tech and other startups.

The 2021 Ann Arbor Entrepreneurial Ecosystem Report is a comprehensive analysis of the startup community in Washtenaw County. The region, which is consistently ranked among the best places in which to live and work in the country, has built a strong foundation of talent, research, and capital that supports nearly half of all startup companies in Michigan. This foundation is largely characterized by a collaborative community, and these meaningful connections have stabilized the economy during a remarkably difficult time. The findings from the report revealed a record-breaking year of venture capital investment in startup companies, with 43 startup companies in Washtenaw County attracting more than $215 million from venture capital firms.

Key Highlights from the 2021 Ann Arbor Entrepreneurial Ecosystem Report

  • There has been a 64% increase in the number of high-growth venture-backed startups in Ann Arbor over the past 7 years.
  • Most tech startups in the Ann Arbor area are currently in the information technology and life sciences space.
  • 69 active venture-backed startup companies in Washtenaw County have raised over $1 billion in venture capital funding.
  • In the last year, 43 startup companies in the Ann Arbor area attracted more than $215 million from venture capital firms, a record for the region.
  • 46% of the startup companies in Michigan are located in the Ann Arbor area.
  • There are 69 venture-backed startups in Washtenaw County.

The Impact of COVID-19 on the Small Business Community in Washtenaw County

The 2021 Ann Arbor Entrepreneurial Ecosystem Report analyzed 500 local businesses, including startup companies, with fewer than 25 employees, to see how they were impacted by the COVID-19 pandemic. The findings from the analysis show:

  • 48% of businesses in Washtenaw County are currently hiring.
  • 66% of business owners say the best way for residents to support small businesses in the region is to spread the word about companies they like.
  • 49% of business owners in Washtenaw County say the best way for policymakers and economic development organizations to support companies is to provide marketing support.

At Cronicle, we are currently seeing a gap in new companies versus the marketing and visibility they can attract on short notice. This is largely due to the lack of funding for marketing or media coverage for what is turning out to be a historic shift in Michigan's economy, particularly in areas like Ann Arbor. Keep an eye on future reports for changes not only in the number of companies coming out of Ann Arbor, but the trends in how these companies launch themselves onto the broader scene.

View the full 2021 Ann Arbor Entrepreneurial Ecosystem Report.

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