spotlight
Rebootin
New Economy
Initiative seeks to
accelerate business
and innovation in
southeast Michigan.
The
J
Sandi Svoboda
Special to the Jewish News
A
few years ago, leaders from
10 philanthropic foundations
(Community Foundation for
Southeast Michigan, Max & Marjorie
Fisher Foundation, Ford Foundation,
Hudson-Webber Foundation, W K.
Kellogg Foundation, John S. & James
L. Knight Foundation, the Kresge
Foundation, the McGregor Fund, Charles
& Stewart Mott Foundation and the
Skillman Foundation) looked at southeast
Michigan and said, "We've got to do some-
thing about the economy:'
Pooling some of their resources, the
foundations created a $100 million fund
in 2008 — the New Economy Initiative for
Southeast Michigan (NEI) to make grants
over eight years to organizations that serve
entrepreneurs in southeast Michigan.
The idea was first to learn what was
needed and then fund some of the ini-
tiatives to help revitalize the regional
economy through supporting business and
creating a culture change related to how
jobs, economic growth and an economic
vision are viewed.
Moving from the automotive-centric to
a more diversified economy, supporting
smaller companies and individual entre-
preneurs instead of focusing on large
corporations, and preparing an educated
workforce were all part of NEI's early
goals. Today NEI is funding dozens of
programs, projects and organizations that
seek to help the region's entrepreneurs
start, expand and attract investment
across a range of industries.
During 2012, the Jewish News, the
Arab American News, the Latino Press,
Michigan Korean Weekly and the
Michigan Chronicle, which make up New
34 December 20 • 2012
1hP
Michigan Media (NMM), have been run-
ning articles showcasing entrepreneurial
talent and success from minority com-
munities. That work has been funded, in
part, by the New Economy Initiative.
"These newspaper articles not only
highlight individuals' successes, but also
help tell the story of the communities,
creating greater aware-
ness of the entrepre-
neurial successes that
can redefine the positive
potential of this region:'
said Hayg Oshagan,
NMM's executive direc-
tor. "We need to remake
the narrative of Detroit
to one of opportunity
and growth, realizing
that a good deal of it
comes from minority
David Egner
communities:'
Oshagan recently met with NEI's
Executive Director David Egner to talk
about NEI's work across the region. Here
is an edited version of their conversation.
NMM: How has NEI's work evolved since
those initial start-up meetings?
Egner: In the early portion of NEI's life,
there was a lot of learning. Eighteen
months into the program, we had only
made seven grants. We were on a per-
petual learning curve. What it ended up
meaning 24 months after we started was
that it was really about reclaiming the
region as a globally recognized innova-
tion hub that provided opportunities for
anyone who wanted to work and own
a business to be able to start a business
— any kind of business; we're not sector-
specific. We think it's about opportuni-
ties. We've always been focused on creat-
ing an infrastructure that would serve all
people.
NMM: What was NEI's first priority?
Egner: Studying the assets of the region
that provide comparative advantage.
Detroit is a region that tends to define
itself by its deficits, not its assets. Part
of that is the culture of the automotive
industry and the dependency on large
employers. But the reality is 70 years
ago, 100 years ago, this was the
equivalent of Silicon Valley. It
was one of — if not the —most
innovative areas on the planet.
All of the assets that existed then
still exist.
NMM: What are some of the
biggest assets?
Egner: I'll list them. The
most-crossed border in North
America. The most sophisticated
logistics system is here because
the autos built it. A huge population of the
creative class, from auto engineers to fash-
ion designers, that has not been fully taken
advantage of. Three Tier I research uni-
versities within 80 miles of each other that
all have a presence in the city of Detroit
as well as their own campuses. Combined
they have over $2 billion a year in public
research. Idea generators like health care
systems: Beaumont, Henry Ford Health
System and the Detroit Medical Center.
Also, places like Next Energy, where they
are playing in a new industry. A very large
and growing ethnic population that can be
galvanized around the issues of the region
and around issues of entrepreneurship. I
can keep on going.
NMM: One NEI priority has been to invest
in research in the region. What is the sec-
ond?
Egner: Another area we've looked at is the
regional workforce: How to do our best
to improve workforce training and create
an employable workforce. We strategically
looked at the community colleges and the
workforce boards and helped them come
together to form a Workforce Intelligence
Network. WIN is a real-time data pro-
gram focused on where jobs exist instead
of using U.S. Department of Labor data,
which is 18 months to two years old.
For example, the Department of Labor
says we have way too many engineers;
we're in a down cycle. WIN says we have
one qualified engineer for every five open-
ings. The Department of Labor data says
we really don't need any more IT profes-
sionals, but the WIN data would show
we've got a 6,000-8,000 person gap in IT
professionals.
The next trick for WIN is that we're
working with the community colleges and
workforce boards to develop curriculum
and make connections there.
NMM: The third area is what you call the
"entrepreneurial ecosystem:' Can you tell
us about NEI's investment in this category?
Egner: This is where we found the real
sweet spot, working on the entrepreneurial
ecosystem with programs, training and
initiatives that promote entrepreneurship.
The first grant was made in spring 2009.
We've made about $36 million in grants in
the entrepreneurial ecosystem, and we're
about to make about $30 million more.
NMM: Why do you call it an "ecosystem:'
traditionally a more scientific term?
Egner: Because it's messy. It's not a neat
system. You can't look at an entrepreneur
and say you need two tablespoons of this
ingredient and three cups of that. It chang-
es. A biological ecosystem is messy, and it's
very organic with lots of collisions and lots
of interesting relationships, dependencies.
It's a far better metaphor than anything
else I can come up with.