CEO Podcast: Bill Mayer, Ann Arbor SPARK

Paul Krutko: Welcome to Ann Arbor SPARK’s CEO Podcast…Conversations on Economic Opportunity. My name is Paul Krutko, and I’m the President and CEO of Ann Arbor SPARK.

Bill Mayer is joining me on this podcast to share how SPARK supports early stage tech startups in the Ann Arbor community. This is a part of a series of podcasts that share the various parts of SPARK’s strategic plan and work program. Bill’s team works with hundreds of startups each year, offering resources, funding, mentorship, and guidance to help founders turn ideas into thriving businesses. With a background in venture capital, early-stage investing, and startup operations, Bill brings both a founder’s mindset and an investor’s perspective to his work. He is also very deeply embedded in Michigan’s innovation ecosystem, particularly here in the Ann Arbor region, and he brings very keen insights to that role. That role includes building programs that make Ann Arbor one of the most supportive environments for entrepreneurs in the Midwest. 

So Bill, to start us off, can you give us a big picture overview of SPARK’s Entrepreneurial Services team and the work you do with early-stage startups?

Bill Mayer: Appreciate you having me on. So my background being mostly in startups, this is very second nature to me, but in the context of overall economic development, one of the things I really appreciate about Michigan is back when the smart zones were created in the late nineties, early two thousands, they understood the value that early stage technology companies can bring to the economy by virtue of them not staying small companies, them actually growing into large scaled employers that bring a lot of benefit to our community. So I hear it all the time that Michigan is uniquely positioned to have a strong startup economy and I think Ann Arbor is emblematic of that with the University [of Michigan] here, just our numbers are very, very strong and if you look at what outputs you get over the long term from supporting with however many thousand dollars in early stage tech startup in terms of the job creation and the economic benefit, it’s really the best deal going in economic development.

You’re talking about a couple, few thousand dollars to create a job, even though it takes a little longer. But this organic growth of early-stage technology companies, I feel that we’re very lucky in Michigan to be positioned as such. And then I’m very lucky at Ann Arbor SPARK to not only have an excellent community that’s very welcoming and very active with early-stage technology, scalable startups, and we also have a great team that can add a lot of value to these companies. So that’s kind of why we’re doing it and we’ll get into how as we go through our conversation.

Paul: So your next slide shows your team. Can you describe a little bit about the team and what they all kind of do? 

Bill: The funding mechanism that supports the early-stage technology work we do obviously enables us to have a team on staff that works with our clients. And we’re going to go through the process of how a startup moves through our program. But at the end of the day, it’s really our people that we’ll meet with, we’ll give advice, we’ll connect companies to resources, all of that. So it’s kind of the hub and spoke analogy of if SPARK is a hub for the ecosystem, it’s really our team members that are delving into that and sort of making all of those referrals and connections and assistance possible. 

So you have myself, of course, and Loren Townes Jr., who is our sort of senior client account manager in Ann Arbor, Kristine Nash-Wong, who runs our client service and small business support hub over in Ypsilanti, we have Janice Seabolt with our mobility team. Ben is working with the mobility team and also as part of the Global Epicenter for Mobility (GEM) grant, we have Hayden — all of our clients know Hayden because he’s our data analyst that makes sure everything gets done properly and all our data is accurate and we report it efficiently. And then Charlotte and Heather in the incubator — that really sort of make sure our clients are taken care of and that all our events go off smoothly, all of that.

Paul: Your team has a set of values guiding how you work with founders, things like trust, clarity, responsiveness, and collaboration. How do these values influence your approach?

Bill: You’re really talking about the backbone or the ethos that our team has around how exactly to engage and work with early-stage founders. And for anyone that’s listening that has founded an early-stage company, it’s tough. It can be lonely, it can be lots of rejection, it can be challenging. 

So the first value that we embody is trust. And for these entrepreneurs who are not exactly sure if this is going to work, they don’t have everything figured out, all of that, building a trusting professional, honest relationship with these companies is key to us being able to do the work that we do. Everything from client privacy to quality of advice. If our clients trust that we’re going to actually help them in a meaningful way that really sets the stage for us being able to do the work we do. 

The next value we have, we refer to as a founder-centric approach. And that’s really in essence just having empathy for the people that are trying to do this work. As I said before, it can be tough, it can be lonely, there are lots of reasons to quit, but our founders persevere through passion, resiliency, and just sheer determination are often very, very focused on getting their product to market. So by meeting founders where they are and having conversations with them that are going to feel relevant and sort of supportive in that very early stage where a lot of people are saying, I don’t know, that sounds kind of crazy, or talk to me once you have 20 customers. The fact that we can actually engage with ’em in the beginning I think really embodies that founder-centric approach. 

And the next value that we focus on is clarity. And that’s around the fact that many of the programs that we have, since they’re funded by taxpayer dollars, have rules and caveats and things like that associated with them. So we try to be very intentional, very clear through both our written materials as well as our in-person meetings, ‘here’s how the programs work’. Not everything may be appropriate for every company, but we try and lay it out in a very digestible way that people can understand the process and as we move through it, it really helps things move along. Our next value is responsiveness. I mean, we are our communication. So founders want to move fast and we can’t always match founder speed, but making sure we have good communication quickly that matches the founder’s pace is key. 

And then the last value that we embody is collaboration. And we’re very lucky in Ann Arbor that we have a very, very strong ecosystem with a lot of players, and I’ll actually talk about that a little later, but by collaboration with our partners and other people that are adding value to the companies that we serve. That’s a bit of the secret sauce as to how Ann Arbor works.

Paul: So in 2024, your team supported more than 450 startups and helped create over 1,200 full-time equivalent jobs. What factors help you exceed your goals in 2024?

Bill: Well, I think there are two things. Number one, we’ve spent the last year refining our internal process to try and make it more efficient, more streamlined, more sort of user- and client-friendly. So that’s part of it. But the other thing, and there’s going to be a little bit of speculation here on my part because as any good economist knows, sometimes proving things is a little difficult. But we’ve seen some uncertainty come into the economy. We had COVID, we came out of COVID, we had other sort of geopolitical forces. And so one of the things we’ve always known to be true is that difficult economic conditions tend to be very positive for new startup companies. It’s a bit counter to the full employment mindset. We certainly saw that with Pfizer when they left Ann Arbor, all of a sudden we had a lot of unemployed scientists, so then we had a lot of brand new life science startups because those scientists, they thought, okay, well since I don’t have a day job anymore, this seems like the time for me to take action on the thing I’ve always wanted to do. I think we had a tailwind from an entrepreneurship standpoint with some uncertainty in the economy and the labor market and things of that nature coupled with us having a streamlined process coupled with just Ann Arbor continuing to evolve as an entrepreneur ecosystem. And those three factors just drove fantastic results for us in the past year.

Paul: So looking ahead in 2025, you’re looking to create 50 new companies and deploy about $1.3 million in grants to the clients that are being served. What changes or continued focus will help make that happen?

Bill: I mean, I think it’s going to be just continuation of the momentum I laid out, and I’ll give you a little sneak peek to you and our viewers, we’re already on pace to exceed those goals. And so I think we don’t really know what the rest of 2025 is going to look like, but if it continues at the pace of the first half of 2025, we’re setting records in terms of companies created, companies served, things of that nature. 

I’m keeping an eye on the labor market overall. I think the labor market in the United States may have some challenges, but I actually think it’s going to be very good for our early-stage companies if the labor market does end up softening a bit. That just makes people more accessible for the early-stage companies, which often have a hard time competing from a salary benefit standpoint, all of that with some of the larger companies. So it could be a net positive.

Paul: Well, one of the things that you described a little while ago was an effort internally to make process improvements to better serve our clients. And so one of the things that I know you’ve been working on is sort of outlining the phase process we use to assess a stage and its readiness for funding. Can you walk through the four levels of support and what kind of progress you look for at each stage?

Bill: Sure, absolutely. And if it’s possible to get slide number six up on the screen, that would be very helpful. But basically what we did is since we’ve been doing the sort of non-dilutive support grants in Ann Arbor for coming up on about 20 years, the board of directors that oversees the early stage work that we do known as our local development finance authority, we’ve built a very trusting relationship with them. And so over the last few years we’ve had a number of conversations about allowing us to do more discretionary work before we actually have to submit to our third-party review committee. 

So we formally had three components to our program. We expanded that to four and we actually increased the amount of support that we could give directly to companies. So the way that it practically works is when we meet a company, they may be extremely nascent, it may be an idea on the back of a napkin, and we really try not to judge ideas.

We try to look at data and so somebody’s got an idea, okay, let’s go out and test it, and this is what every serial entrepreneur knows, try and break it a hundred different ways. And if it’s still intact, you have something and it’s time to try and grow it. Other people will go out and realize, well, the first idea I had wasn’t exactly right, but through the process of doing discovery, I actually found something even better. And then obviously an outcome can be, you know what? It’s a neat idea. It’s just not viable from a business standpoint. People won’t pay for it, et cetera. So the level one funding, which is the first funding any entrepreneur would access from us in the amount of up to $15,000, that is very accessible. That’s money that if we explore, is the idea viable? Is there product market fit?

Is whoever’s going to use buy and pay for this, able to do that, that’s great, but if it doesn’t work out, that’s okay too. The way that money should be viewed as the exploratory stage of ‘do we have something here or do we not?’ 

So once you reach the $15,000 cap at level one, moving to level two is all about, well, have you made improvement since we first met you? Did you do some customer discovery? Did you learn some things? Have you refined a business model? Do you actually have a pricing strategy? Is your competitive analysis more robust than it was when we met you? And if we can show that the company has made forward progress that releases the next $15,000 of support, which we call level two. 

Now when you expend that resource, you get to what’s known as level three. Level three is a little harder in that you put together some materials for us, pretty straightforward, and it goes to our review committee. And if our review committee says, okay, we like what this company’s done, we’re sort of understanding where they are. And at this phase a company really should be entering the market. So less theoretical, experimental, more, Hey, we’ve got three customers with their hands up that if we can get them product, they will give us money. That’s really the place for level three and that $20,000. 

And then the last level, and this is the hardest one to get, is the final $25,000. That’s really, you have paying customers, you’ve got employees. Now it’s about scaling the business. So hiring people, sort of making investments that close customer sales, the type of growth stage that companies get into when they are being successful.

Paul: So the following slide really shows that a document we use working with the client to evaluate against the series of criteria where they stand. And this is a roadmap I believe that your team uses to say, you’re doing really well on a couple of these, but here are other areas that you need to focus on. And it really gives them a roadmap on how to move from stage to stage. You want to walk through this form a little bit, Bill?

Bill: Yes, absolutely. So this is something we added to our process and what I want people to, anyone who’s thinking about, Hey, I should potentially think about working with SPARK, the thing to keep in mind is this isn’t a pass-fail exercise. We send a self-assessment to our clients that asks them things about your problem identification, your solution statement, your customer discovery activities, your financials, your business model, go-to-market strategy, all those things. How much time have you spent either thinking about it or working on it? And it’s a scale of one to five, where one is, I haven’t really thought about it, five is I’ve completely got it under control. And so I use the analogy of when you go to your doctor, you tell ’em the truth, right? Even if maybe you think you should be a three, but you’re really a two, you tell ’em you’re a two so they can help you.

So like I said, even if somebody came in and they rated themselves all ones, I mean that would be a little alarming. Let’s say ones and twos, that’s okay because what that’s telling us is this founder is being quite objective and honest in looking at the things they need to do. If someone comes into us and they’re all fours and fives, that could be amazing because they actually have made a lot of progress. Or it could be someone underestimating how challenging it is to try and commercialize a technology and build a company on top of it. So what we do is we take that self-assessment and that gives us a bit of a window inside the thinking of the founding team. And we talk about it. We use it as sort of a narrative or at least a guidepost for how we’re going to structure our discussion at the intake meeting, and then we actually score the company, we share that score, and sometimes they match perfectly. Sometimes they deviate a little bit. That’s okay. We’re just trying to give objective, honest feedback that helps inspire the entrepreneur to think about things that maybe they’re not thinking about.

Paul: And on the right side of the form is some interesting advice about how they can successfully engage with us. And then you might want to talk about the important topics because I think that’s important for people and companies, nascent companies, trying to engage with us.

Bill: Good point. So topics, we have a section called ‘important topics,’ and those are things that I want myself and my team to cover at the intake meeting. For example, one bullet would be coachability. And coachability is a term that’s pretty ubiquitous in our ecosystem. And all that means is that the founding team is open to help. They’re open to getting advice if occasionally, sometimes we just don’t see how we could help. That usually leads in if the company is going to, they think they’ve got all their customers and they’ve got it all figured out, that’s great. We’ll come up with a couple milestones and if you can achieve those, come back to us, we can work with you. But the perfect scenario is an entrepreneur who is looking for assistance is objective about their idea or their technology looks at things from different perspectives. That’s a coachable entrepreneur.

That’s very important. Our eligibility criteria around geography and is it a product in market versus just a service company? Is it scalable? Can it achieve $10 million of revenue theoretically within five years of operations, these types of things. And if the eligibility criteria are met, we’ll let the entrepreneur know in the intake meeting that that’s all set. The geography thing is a little funny, but we want to make sure that we talk to them about some of the programs that we have, talent programs, our Entrepreneur Boot Camp, the customer discovery courses that we do, the pro bono marketing services that we can provide. 

And one other thing that’s really important is expectations around timing. So if you don’t lay it out that, Hey, we’re going to strive to get back to every single one of your emails in 24 hours, or we’re going, it’s going to take some time for our committee to review this, et cetera, we’re stewards of taxpayer dollars.

So we do have to follow very sort of even-handed procedures. It’s not up to me just to write checks. So making sure everyone’s on the same page of how the system works goes a long way to make sure no one feels as if they’re being treated in a way that’s unexpected. 

And then we also point out other state resources available to them, and the one that’s very popular is the different investment funds that we have in Michigan. Most entrepreneurs are interested in raising money. So talking about the one that SPARK runs, Mike Flanagan and Lauren Devries, as well as the folks in Lansing and Detroit, Red Cedar Ventures, Invest Detroit, ID Ventures, the folks over in Grand Rapids, et cetera, just so they understand what the landscape looks like.

Paul: And I think you touched on it a little bit. The issue is that we do have some limitations about where a company is located or chooses to locate in terms of geography, whether we can assist them or not. And so we do give them guidance in that area. Well, let’s move to the Business Accelerator Fund, which is a major tool in supporting these companies. How do you determine who gets funding and how does the funnel shape the pipeline of growing startups?

Bill: Right. Well, so most funnels in life, the top of the funnel is all of the submissions we receive. Some of them are legitimate Michigan-based. Some because we’re a very visible economic development entity, we’ll receive applications from California or from Europe or places like that, which it’s flattering, it’s good, but it’s really, since we’re an economic development agency, it’s outside of our scope of what we would actually do. So as the funnel starts at the top and narrows down, it’s the level 1, 2, 3, and 4. The level one funding is always going to be our highest number of companies because quite frankly, it’s part of how entrepreneurship works that some companies just don’t make it past level one. And that’s okay. We want things to happen faster and more efficiently for good and bad. So sometimes companies are sailing through level 1, 2, 3, sometimes companies stall out at level one, but if you look at 557 companies going through level 1; 334 companies going through level two; 108 companies going to level three. And so far we’ve only actually had three companies get to level four. Now we have more sort of in the pipeline. But since it’s a new program, that’s the hardest money to get that plays out somewhat consistently with the venture capital model, or at least the sort of filtering model of raw companies started versus companies that actually take on funding and end up being multimillion-dollar valuation companies. So I feel like we’re pretty in line with what we would expect in this space.

Paul: And the thing that I think is also important to point out is companies move at different speeds through this process. So you might be at a level two longer than other companies are, or you might be shorter in the same thing. So we don’t have a hard and fast rule that, well, if you’re in level one and you don’t move forward within a certain period of time, we won’t ultimately consider you to move to level two or level three. 

So it’s important to share with our audience that our process is more of a patient process in working with startups, particularly since some of them in certain technologies do take longer than others to move through these steps.

Bill: It’s sort of like somebody developing a therapeutic drug versus a piece of software. You’re absolutely right. It’s like an apple and a boat anchor. They’re just completely different commercialization timelines.

Paul: So let’s move to sort of giving the audience a perspective on the range of companies we work with, and we work with companies in the startup area in a wide range of sectors, from software to mobility to medical devices, and to biotech. So just sharing with the audience in your most recent breakdown that spread among a variety of technologies, how does a team adapt when you’re working with so many different diverse industries?

Bill: That’s an excellent question, and that’s a little bit of a secret under the hood that I’m willing to lift up the hood and share with everyone how we do this. And so slide nine that describes our client mix, you can sort of divide it roughly into four quarters, one quarter being software, one quarter being life science related, one quarter being mobility and a quarter being everything else, cleantech, hardware, consumer products, you name it. And so with a team of our size, it’s unrealistic that we would have a subject matter expert that can handle deep dives into all these different companies when we’re literally working with over 300 companies a year. So what we do, and I mentioned this earlier in the form of a hub and spoke model, we maintain a curated list of people and firms, entities, whether it’s lawyers, accountants, or specialized individuals that have experience working with early stage companies and can do specific things to assist them.

So in the life sciences, it might be a regulatory specialist, it might be someone who specializes in material science patents, it might be someone who builds videos and websites and marketing materials. But we have a searchable list of all of these vendors for our clients. And so if we meet a company that is doing something very specific with let’s say, a diagnostic drug in life science, and I’m not going to have a subject matter expert that can go deep into that on staff. So it’s our consultant network that we tap into that we can find a resource that fits what they need and then spark using the level one through four that we talked about, can actually engage that expert to do the work in the form of a consulting project that benefits the client. And SPARK pays the bill and all work, all intellectual property that’s created during the project belongs to the startup company.

Paul: Yeah, I think it’s a really important point that the support that we’re providing, just in terms of the engagement and mentorship is all free to the company. Additionally, if they move through the various levels and we believe they’re eligible for the funding at that level that you use, the phrase, and just for our audience being non-dilutive, what that means is we’re not taking equity, we’re not giving them a loan or something that has to be repaid. It is a grant to them. And so that’s an important feature I think, of our work. And as you described it, that sometimes is a sort of three-piece partnership, if you will, in which what we need is a particular expert, subject matter expert in their technology, and we’re giving the dollars to support that consultant, working with them on their product or their idea. So it is important to share with everybody who’s listening that this side of the SPARK work program and strategic plan is really an aggressive approach to try to grow early stage companies and to do that in a way that enables them to use resources to they’re raising elsewhere for other parts of their business growth.

Bill: Well said.

Paul: Yeah. So let’s talk a little bit about some specific programs that we operate. One of our strengths is that we have a range of hands-on programs. We have the Boot Camp, the EIR [Entrepreneur In Residence] program, and intern match. Can you talk about how those programs work together to support founders and build startup capacity?

Bill: Sure. So I think probably the thing people talk the most about is the acceleration grant program that we’ve already talked about with the levels, but there are a lot of other programs that are pretty valuable and meaningful to our entrepreneurs. One of our oldest and most useful programs is our Entrepreneur’s Boot Camp, and that is a program that any serial entrepreneur will know is all the steps you should take when you’re evaluating a technology or an idea, and if you should actually build a company on top of that. It’s focused on customer discovery, it’s focused on really sort of validating your value proposition and identifying your beachhead market and really just trying to break your idea to see if it’s durable and it’s able to stand on its own two feet. And we’ve had serial entrepreneurs that go through Boot Camp and you think, well, why are they going through Boot Camp?

They should already know this. It’s not about knowing it, it’s about giving you deadlines, a teaching team, a supportive environment, and some motivation in this lonely sport of entrepreneurship to just do the activities you know need to do. I always really enjoy that. And when the companies come out of Boot Camp, they normally have a much clearer vision on what they need to do. And I always say there’s a little extra credit asterisk next to a company that went through Boot Camp because the other thing that it allows us to do, and this kind of goes back to the coachability topic we talked about, is it lets us get to know the founding team. We’re able to build a stronger relationship as they work through all of this, and we’re coaching ’em and giving ’em advice. So we have lots of success stories of Boot Camp teams that went on to raise millions of dollars and have great exits.

But I think the thing that you should think about when it comes to Boot Camp is we’re not asking anyone to do anything they shouldn’t be doing already. We just give them a very sort of nice track to run on. And so deadlines to meet, and people are usually quite appreciative of that. If Boot Camp is a little too intense or you want to sort of learn about it before you go into Boot Camp, we do a customer discovery workshop series that that’s kind of the backbone of what you do in Boot Camp is engage with potential customers, not to sell ’em on your product, but to ask them questions. I always sort of say, you put your inner therapist hat on and just make sure whatever problem you think you’re solving is actually a real problem and people are willing to pay for it out in the market.

So there’s are one day sessions that will give you an intro on what you need to know. We also have a program that I really appreciate. It’s called Our Entrepreneur in Residence (EIR) program. This is designed to take sort of experienced company founders or people that have been in the C-suite in going from early stage to growth stage with tech companies. And the primary goal is to keep ’em in the ecosystem here. So let’s pick on Mitch Rhodes, who founded Quantum Signal a number of years ago and sold it to Ford, worked for Ford for a couple of years, and then left Ford. And so he’s number one, building a very cool video arcade in Saline, but at the same time, he’s an intellectually curious guy, so he’s looking to still keep a toe in the water in the entrepreneurship space. And so we’ve actually engaged him on a couple of projects to help the next generation of up and coming startups.

So we really proactively try and keep our experienced startup people here in the ecosystem. And a good way to do that is give them really interesting things to do. And then the startups are, I always call ’em the lucky beneficiary where they get a skilled serial entrepreneur to help ’em work through all the steps they need to do for their business, hopefully faster and more efficiently than they would do on their own. Another program that’s really popular is we can pay for 50% of an intern. So any of our companies that want to take a couple EMU, U of M, Michigan State, whatever students we can pay for half the payroll cost and actually take ’em on as a temporary W2 to make it a little easier. 

And we have our coworking spaces at SPARK here in Ann Arbor and Ypsilanti, but with coworking, there’s a pretty broad palette of coworking spaces in Ann Arbor, including Bamboo Cahoots, Office Evolution, and more.

So we sort of are collaborative in figuring out for any given company what’s the most efficient space they need lab space, we’re going to send them to MI-HQ that Mark Smith runs. So I think Ann Arbor is well-positioned from an affordable month to month-to-month lease situation for our early companies. And I had startups back in the nineties where there was none of that. They wanted you to sign a 10-year lease. And as a startup, I may be out of business in six months. I don’t know. So that’s one thing I think we do quite well in Ann Arbor. 

And then as part of the incubation space, there are events happening in and around Ann Arbor all the time, many of them hosted by SPARK, many of them by our collaborative partners. Those are real value adds those can get, whether it’s office hours with investors or doing an educational deep dive into an area that all founders need to know, I would recommend subscribing to SPARK’s Event newsletter because there’s just a river of content coming out.

That’s all very helpful. And then the last thing I’ll mention is as part of our user experience project, we introduced a client portal that has all the resources that a SPARK client needs in one place. It’s from our consultant lookup feature. You can search our entire consultant database. We have programs, for example, Amazon Web Services, AWS. They offer free credits for cloud hosting for startups, so does Microsoft, so does Google. So we’re able to sort of plug companies into these different programs, and it’s all laid out right in front of you inside the portal for ease.

Paul: Well, one of the things that has occurred, I guess over our 21-year history is how the ecosystem has grown and evolved and is really based on a lot of strategic partnerships. And the slide that’s up now is really outlining a handful of them, probably the most important ones. Can you talk a little bit about how we work with these partners and how we help companies maximize their opportunity by not only working with us but working with some of these partners?

Bill: Well, the reason Smart Zones exist in the first place is because it was acknowledged by a lot of very smart people before my time, Paul, that said, you’ve got this amazing research university that not only is inventing lots of things, but is educating this workforce of students, and then you have the private sector. How can we get those two to work more effectively together? And so we have smart zones now and SPARK really represents the Smart Zone resources. So when you look at, say, University of Michigan for example, there’s multiple components inside the university we collaborate with from a faculty standpoint, the technology transfer office, which is called the Innovation Partnerships or the IP office at U of M, anytime there’s an invention disclosure that’s potentially a startup. Now, they don’t all turn into startups, but we’re very curious. So the university does a very good job of working with these startups on the very early stage, helping them sort of de-risk things scientifically, technically, all of that to the point where they would get a license that would create a real company.

So we’re very collaborative with the IP office to understand when is a startup coming out and how can SPARK be most effective, taking into consideration the work that’s already been done inside the university. Then you have entrepreneurship support entities inside the university for students. The Zell Institute at the School of Business is a great example of that. The Center for Entrepreneurship in the Engineering School is a great example of that. Fast Forward Medical inside the med school, they’re all sort of working with students and other technologies to see if a student wants to work on a company while they’re in school, that’s amazing. If they want to continue working on it after graduation and really make that their full-time job, that’s even better. And we always broadcast a message that if the latter is what a student chooses to do, SPARK is here to help.

And then we have other entities like the New Enterprise Forum that does elevator pitch coaching. That’s great. They do a great job of that, and they actually hold their events here at SPARK. We really appreciate what they bring to the ecosystem and we, in fact, we even host ’em at SPARK on the third Thursday of every month. Washtenaw Community College, Eastern Michigan University, the Michigan Economic Development Corporation, the Michigan Small Business Development Center, they’re all partners that we know we can either bring into help a SPARK client or in the situation of where someone approaches us and maybe they’re starting a service business that doesn’t quite fit into the scalable technology-focused innovation companies that are, we have the specific funding to support. We can refer those companies to an entity. The ethos I try and instill in my team as anyone who contacts or touches SPARK should be better off because they did, even if that means we referred them to the right resource.

Paul: So as we close out our conversation on this podcast, you’ve been able to work with some impressive companies that have grown significantly, and we put three names up on the screen. Is there a particular success story that stands out to you? And maybe you can share a little bit about how SPARK participated in the journey of that company?

Bill: Sure. So the three companies on the slide, SkySpecs, Alert Watch, and Groundspeed. How do you pick your favorite child kind of thing. They’re all excellent, but if I have to pick on one of ’em, I’m going to pick on SkySpecs for a minute. I really like their story back, who’s counting? But it was a number of years ago, we had some postdocs and some graduate students that won a competition. They flew a drone, completely autonomous and dropped a jump drive on a table in a smoked filled building. The drone flew out, they won. Okay, that’s neat, but what are you going to do with that? Right? The reason they were excited is because back in this time, creating the suite of sensors and the software to let the drone navigate autonomously without really line of sight being available was pretty innovative. And so, okay, we have motivated, passionate, obviously very smart founding team.

What do we do with this? How do we build a business on top of this? The team back at that time was pretty focused on making the hardware, and they actually went through our Entrepreneurs Boot Camp. And if I can give one resounding message that we gave to that company is, please do not become a drone hardware company. You can buy drones today from China or anywhere else for 20 bucks, right? That’s not really where the business opportunity was, where the business opportunity was, was creating some sort of value proposition that whatever their innovations they had come up with for these drones could do, it could solve a real world problem. And we struggled, Paul. We kicked tires, we turned over rocks, we looked behind bushes. What are we going to do with this really cool technology? Because the ultimate thing about the technology was I could fly, and they have a great video of this.

I could fly a drone straight at you and it would stop and it would not hit you If you ever had a model airplane when you’re a kid, first thing you do nose dive into the ground, build your second model plane, don’t nose dive into the ground. So basically the value proposition was we have a drone, and through our software and sensor suite, it’ll never hit anything. Okay? They looked at flying through sewers, they looked at all kinds of crazy applications for this, and it was actually a guy named Norm Pinot that said, wait a minute. Have you ever thought about wind turbines? And everybody said, well, what are you talking about normally? Who cares about wind turbines? Well, there are people in harnesses with ropes that climb up those blades to inspect them. What if, hear me out, we could use the drone and in the wind it didn’t hit it, whatever.

And they said, huh, okay, well, we haven’t hit on anything else. Why don’t we give that a shot? They did their customer discovery. They started talking to wind farmer operators, and what do you know? There was a massive need for something like this. And you look at SkySpecs today with hundreds of employees. They’ve actually purchased companies. They purchased a company in Romania. They’ve sort of become this very prolific employer here in the Ann Arbor region. And if you go back to the origin, I mean, we were all scratching our head about how are we going to take this really cool technology and turn it into a real business? They’ve followed that path through to multiple funding rounds, just absolutely killing it here in Ann Arbor. And it just started organically and went through our process, and we’ve continued to support them as a business development client beyond the entrepreneur service team. But to me, that’s a great story of watching the entrepreneurs sort of figure it out with tons of support and guidance from the ecosystem.

Paul: Well, what’s interesting, and it’s a great story. One of the things that is important to share with the audience is some might say, well, why do you spend so much time working with these early-stage companies? And the reason we do it is because if you look at the data across the United States, and if not the world, most new job growth comes from these kinds of companies. And so this example with SkySpecs in which they have hired hundreds of people here, and that in terms of our mission changes, families lives. They now have employment. They can do things for their family, they can send their kids to school to do various things that we all want to try to do. So the reason we work so hard on growing these companies is the incremental growth from our big companies is not very significant. They have fully staffed up and are not growing lots of jobs where the new job opportunities come for the kids graduating from college here, from people who are going to technical school here are from these kinds of companies.

So we always try to connect that dot for the audience that this is why we do it. It’s not just so that somebody can have an exit and have achieved great success because their company got bought. It was that they created a company that gave opportunities to lots and lots of people in our community. 

So Bill, I want to thank you. This was a very intense conversation, but we thought it would be useful to share over the next year or so, a good detailed outline of what each of the components of SPARK does. And this was a really good viewpoint, I guess, and insight into how your team works with entrepreneurs, basically in the tech area of our economy. So again, thanks, Bill.

Bill: Of course.

Paul: And I want to thank our audience for listening and learning more about SPARK’s business development activities and how they impact the Ann Arbor region’s economic future. 

Paul: You’re welcome. So as we close out, I want to thank our audience for listening and learning more about those leaders and organizations working hard to create the Ann Arbor Region’s economic future. These conversations are brought to you by Ann Arbor SPARK. For more information about Ann Arbor SPARK, you can find us on the web at annarborusa.org. We’re also on Facebook, Instagram, and LinkedIn.