Michigan Strategic Fund Moves to Support Advanced Manufacturing Jobs, Startup Innovation

The Michigan Strategic Fund (MSF) today approved a series of amendments and program updates intended to strengthen Michigan’s leadership in startup innovation, small business support, and the state’s advanced manufacturing workforce.

The approved measures include an allocation of $5 million from the Jobs for Michigan Investment Fund to the Michigan Innovate Capital Fund (MICIF) program, an amendment allowing MICF investment fund managers to increase the exposure limit per company to a total of $500,000, and an amendment to the grant agreement between the MSF and the Invest Detroit Foundation’s ID Ventures to fund the continuation of investments in the form of loans and equity financing under the MICF program

The MSF board also approved a series of MICF program updates and amendments to help the Michigan Economic Development Corp. (MEDC) continue to provide essential support to high-tech startups in the state.

In June 2023, the MSF approved the MICF program, which provides award incentives to nonprofit organizations that operate fund programs to invest in pre-seed and startup stage competitive edge technologies that require capital in the earliest stages of the commercialization process.

“Whether supporting Michigan’s startup ecosystem, capitalizing on federal support for small businesses in our automotive manufacturing sector, or ensuring the continued success of a key battery plant project in Lansing, today’s approved actions and projects by the MSF board help Team Michigan deliver on the state’s ‘Make It in Michigan’ economic development strategy of supporting people, places, and projects,” says Quentin L. Messer Jr., CEO of the MEDC.

The board also voted to accept more than $9 million in Investing in America Small Business Opportunity Program (SBOP) awarded to the MEDC by U.S. Treasury, which will go toward providing technical assistance support to very small businesses and businesses owned and controlled by socially and economically disadvantaged individuals (SEDI). The proposed program will seek to support SEDI-owned suppliers in Michigan’s automotive manufacturing sector, with a focus on those impacted by the transition to EVs.

Additional activities around the Michigan Auto Supplier Transition Program are expected to be presented to the MSF Board at a future meeting.

The MSF board also approved amendments to the incentives authorized in January 2022 for the construction of an Ultium battery manufacturing facility in Lansing, originally a joint venture between General Motors Co. and LG Energy Solution (LGES). Through the sale of GM’s portion of the battery plant and 100 percent transfer of state incentives already secured for the facility, LGES will wholly own the facility — ensuring the project stays on track and high-tech jobs and battery manufacturing remain in Michigan, according to officials.

In committing to the agreement under the original Ultium joint venture, LGES is maintaining at least 1,360 Michigan jobs committed to by the original Ultium joint venture, guaranteeing the future of the Lansing facility and supporting continued job growth in the state.

Reassigning incentives to LGES as the new owner of the Lansing facility will ensure it remains a catalyst for continued investment in the region and accelerates cell production. To date, project has resulted in:

• Construction of the facility is 98 percent complete.
• More than $2 billion invested to date.
• A commitment to creating at least 1,360 good-paying, permanent jobs in the community.

“With its talented workforce and location in the heart of the U.S. auto industry, we see Michigan as a great bet to continue investing in,” says Bob Lee, corporate executive vice president and head of North America for LG Energy Solution. “We are playing a critical role in onshoring this strategic technology, and our investment in Lansing underscores our belief in the state, in which we established our first-ever North American battery-making plant in 2011.”