Michigan Small Business Grants
There are two important stages to complete prior to starting a new company and they are business planning and financial budgeting. Financial budgeting takes into consideration various factors like initial investment, operational investment, and miscellaneous expenses. More often than not, these investments or expenses can be higher than expected and this is where a Michigan small business grant can be quite helpful. A grant is a type of financial assistance similar to loans, yet different in many ways. This article has been created to provide first-time business owners with an insight into various grants, loans, business incentives, and other forms of Michigan small business funding that they can leverage.
Doing Business in Michigan
Doing business in Michigan can be quite promising from the point of view of stable growth and future expansion. Michigan boasts of a strong economy with the Real Gross Domestic Product (GDP) at $567.94 billion. The state has a pro-business climate driven by a wide variety of Michigan small business incentives. Michigan has also received from the Standard & Poor’s (AAA) the highest credit rating amongst the 15 states with AAA ratings. The state is also home to several Fortune 1000 companies as well as industries such as finance, technology, insurance, real estate, manufacturing, logistics, service, film, transportation, communications, and trade shows. The progressive income tax structure along with tax credits and other tax-related benefits makes it easier for entrepreneurs to start a new business and achieve sustainable growth.
Why do businesses prefer doing business in Michigan?
Doing business in Michigan is a very enjoyable experience due to the several advantages that the state offers. The state has a robust infrastructure and strong supply chain management. Several companies headquartered in the state are now listed in the Fortune 500 list including ExxonMobil, Walmart, and Amazon. New businesses can also check the availability of Federal and Michigan small business grants to help provide the initial financial boost required. Let us take a look at some of the advantages of conducting business in this state.
- Emerging Startup Ecosystem – The state of Michigan is considered to be one of the newest startup ecosystems in the USA. The Global Startup Ecosystem Report (GSER) has revealed that Michigan is considered the best high-tech hub emerging in the Midwest. The city has been conferred with the title of an emerging high-tech hub and is ranked among the top 10 startup ecosystems in Detroit and Ann Arbor. Startups will not only be able to apply for Michigan small business grants but can also bid for a venture capital investment. The venture capital share in the state of Michigan has had a jump of 866 percent between 2016 ($300 million) and 2020 ($3.1 billion). The state is also home to several accelerators and incubators for startups and entrepreneurs like Ann Arbor SPARK, Automation Alley, and NextEnergy among others.
- Diverse Talent Pools – One of the top requirements for any new business is a skilled, reliable, and committed workforce, and Michigan offers all of these and much more. It is home to some of the top universities and colleges such as the University of Michigan, Ann Arbor, Michigan State University in East Lansing, Wayne State University in Detroit, and Michigan Technological University in Houghton, among others. Whether you plan to establish a software startup, want to explore transportation services, or start a new business in the temperature-controlled logistics industry, Michigan’s diverse talent pool will not disappoint you. The state has successfully created a strong talent pipeline overseen by the Michigan Economic Development Corporation (MEDC), which makes doing business in Michigan highly profitable.
- Grant Programs – Every business requires a strong financial plan and some form of funding to give the startup the initial boost it requires. This is where Michigan small business grants can be helpful as they are different from loans. You have to pay a loan back, but grants are not paid back. The most important is the MI Business Grant Program administered by the Department of Treasury. Some of the other grant programs in the state include Michigan Small Business Relief Program, the Michigan Small Business Restart Program, Entrepreneurship & Innovation Program, and the International Trade Program among others.
Incentive Programs in Michigan
When you form a startup in Michigan there are several benefits for you to enjoy including a wide variety of Michigan small business incentives programs. These programs have been created to target first-time entrepreneurs as well as existing small and medium-sized enterprises (SMEs). Here is a list of some of the most popular and top incentive programs in the state.
Michigan Business Development Program (MBDP)
If you are planning to start a company and are searching for Michigan small business funding options, then the Michigan Business Development Program (MBDP) might be just right for you. This program is administered by the Michigan Economic Development Corporation (MEDC) on behalf of the Michigan Strategic Fund (MSF). The primary objective of this funding program is to enable business growth by encouraging investment in the state and offsetting costs. A business can apply for this type of funding through the creation of qualified new jobs as well. You can receive funding in the form of Michigan small business grants, direct loans, or other categories of economic assistance. The maximum amount available under this program is $10,000,000.
Critical Industry Program (CIP)
The Critical Industry Program (CIP) is a Michigan small business funding program that provides qualified investments to qualified companies. Here, a qualified investment refers to a loan, grant, or other economic assistance towards a project undertaken by the company applying for funding. This Michigan small business grants program is administered by the Michigan Economic Development Corporation (MEDC) on behalf of the Michigan Strategic Fund (MSF).
The projects undertaken by new businesses can vary from infrastructure improvements to the acquisition or purchase of heavy machinery and workforce development among others.
Strategic Site Readiness Program (SSRP)
The Strategic Site Readiness Program (SSRP) is administered by the Michigan Economic Development Corporation (MEDC). This is a type of Michigan small business incentives program that provides financial incentives to eligible businesses or applicants. The activities eligible for this incentive program can vary from land acquisitions to infrastructure improvements, creation of wastewater infrastructure, improvement of buildings, building construction or demolition, and environmental remediation among others.
Jobs Ready Michigan
The Jobs Ready Michigan program has been created specifically to meet the growing talent needs of small businesses, which are expanding in the state or planning to relocate to Michigan. This is a flexible program and is highly responsive toward the specific talent requirement of companies, thus making doing business in Michigan effortless. The program addresses the various costs associated with the recruitment and training of individuals in occupations that are considered high-skill, high-demand, or high-wage. If your company is planning to create jobs in the state then you will be eligible to apply for this Michigan small business grants program.
State Essential Services Assessment (SESA)
This is a different type of Michigan small business incentives program. The program has two parts: the State Essential Services Assessment (SESA) Exemption, and the Alternative State Essential Services Assessment (SESA) Incentive. The exemption program is primarily for projects planned or operational in eligible distressed areas (EDAs). The alternative SESA incentive program focuses on projects undertaken in other areas (non-distressed areas). The SESA exemption can be to 100 percent exemption for a maximum period of 15 years. The alternative SESA incentive is equal to a maximum of 50 percent exemption for a period of up to 15 years. The SESA incentive program makes doing business in Michigan quite advantageous.
Michigan Community Revitalization Program (MCRP)
The MCRP is one of the top Michigan small business incentives programs and is made available to small businesses by the Michigan Strategic Fund (MSF). The focus of the Michigan Community Revitalization Program (MCRP) is to encourage as well as promote redevelopment of brownfield and historic preservation sites along with structural renovations of sites located near high-impact corridors and in traditional downtowns. This program may require businesses or applicants to pay an application fee or any other expense, which is incurred during administering of the award. The proposed incentive amount can be less than or more than $1,000,000.
Funding Support Programs in Michigan
The Michigan Economic Development Corporation has created several programs that focus on Michigan small business funding. One of the key factors that contribute to operating a business successfully is access to capital. Most small to medium-sized businesses require some form of capital, and this is made possible through MEDC Capital Access. MEDC Capital Access is made up of several other programs and their primary objective is to help small businesses throughout the state receive loans from banks as well as lending institutions. Some of the programs within MEDC Capital Access include the Collateral Support Program, the Loan Participation Program, and the Capital Access Program.
Apart from this, a startup can also take advantage of the Pure Michigan Business Connect (PMBC) initiative. This is a public/private initiative that helps goods and service suppliers in Michigan to connect with different levels of corporate purchasers. There are several other Michigan small business funding resources available for first-time entrepreneurs and high-tech startups. These resources include Michigan small business grants and early-stage funding programs including the Michigan Mobility Funding Platform and the Michigan Translational Research and Commercialization (MTRAC) Program.
Growing MI Business Grant program
The Growing MI Business Grants Program by the Michigan Department of Treasury provides funding to businesses in different industries. This Michigan small business grants program aids in the creation of a process by which small businesses can receive a specific percentage of the financial losses incurred by the entity. It is calculated based on the said entity’s entire timeline of operation. The total amount of funds available to eligible businesses is $409 million. Some of the business categories eligible under the Michigan small business funding program include entertainment venues, recreational facilities, exercise facilities, food establishments, and public lodging establishments among others.
Michigan Small Business Survival Grant Program
The Michigan Small Business Survival Grant program supports the funding needs of various businesses in the state that have been disproportionately impacted by COVID-19. This Michigan small business grants program makes grants available of up to $20,000 for businesses that closed down due to the Covid-19 impact. It also awards grants of up to $15,000 to businesses that are operational or partially closed. The grant is disbursed through nonprofit economic development organizations (EDO) in the state like Invest UP, Target Alpena, Middle Michigan Development Corporation, Lansing Economic Area Partnership, and Ann Arbor Spark among others.
Ready to Start a Business in Michigan?
Every new startup or business requires some form of financial assistance during its formation and operational stage, this helps them to execute their business goals in a better way. The state offers several kinds of assistance through the Michigan small business incentives programs specifically for small and medium enterprises across diverse industries. If you want to start a new business in this state then there are plenty of funding programs you can take advantage of after registering or incorporating your company.
IncParadise is an expert incorporation provider and offers one of the most reputed Michigan registered agent services. We can help you to start a business in this state. We also provide additional services that can assist you with all your annual filings including annual reports.