Unique Venture Funding Finds Detroit

We’ve heard how Detroit is beginning to attract entrepreneurs from other parts of the country and, in particular, young, energetic millennials wanting to make a difference. Venture for America (VFA), a two-year Fellowship program which is focused on recent college graduates, is providing support to young entrepreneurs in cities across the country who desire to become entrepreneurs. Detroit is one of the cities involved.

VFA has spawned young entrepreneurs whom have relocated to Detroit such as:

Brian Bosche, CEO, along with Dan Bloom, COO, co-founded Slope a company focused on assisting businesses in the areas of managing media projects and storage. It also develops and provides software for organizations focused on saving companies time and money. Bosche was was a VFA at Bizdom Detroit, the tech startup accelerator founded by Dan Gilbert and has a degree in Environmental Studies and Anthropology from Dartmouth College.
Max Nussenbaum, co-Founder and CEO at Castle, along with co-founders Scott Lowe and Tim Dingman, met at the inaugural VFA training camp in the summer of 2012. Last year, the three of them purchased and restored an abandoned house in Detroit, transforming it into a communal living and working space for VFA Fellows. Castle is focused on automating property management tools through software and on-demand labor, and providing robust solutions across various industries.

Brian Rudolph, Co-Founder and President at Banza, along with co-founder Scott Rudolph, and Avery Hairston, have focused on developing a unique product–Banza, the first pasta made from chickpeas. While the product looks just like regular pasta, Banza is particularly nutritious. For example, one 3.5 oz serving has 25g of protein. Since its August, 2014, launch, Banza has expanded to over 750 stores nationally. It is manufactured locally and has helped to create twelve manufacturing jobs in the Detroit-area.
I recently interviewed Nussembaum, Bosche and Rudolph for their thoughts on VFA, establishing business roots in Detroit and their thoughts about Detroit after relocating here.


Lee: What is Venture for America (VFA) and how many cities are involved? Why Detroit?
Nussembaum: VFA is a two-year Fellowship program that sends recent grads to developing cities, like Detroit, to work in the trenches at early-stage companies. By working under more experienced entrepreneurs, Fellows gain the experience needed to one day start companies themselves, and contribute to America’s economic resurgence in the process. Detroit is in many ways the epitome of a VFA city: it’s a microcosm of the economic and urban development challenges the country faces as a whole. Personally, I was attracted to the once-in-a-lifetime experience that is being a part of Detroit’s resurgence. What’s happening here now will be written about in history books someday, and I’m excited to make my small contribution.
Lee: Who started VFA and why is it important?
Nussembaum: Despite all the hype about start-ups these days, the portion of young people in America starting new businesses is at a thirty-year low. Top college graduates are funneled indiscriminately into fields like finance and consulting, where their contributions are limited at best. VFA aims to solve this problem, while redistributing young talent to emerging cities like Detroit that need it the most. VFA’s founder, Andrew Yang, was inspired to start the program after his own journey from dissatisfied corporate lawyer to failed entrepreneur to, ultimately, CEO of test prep company Manhattan GMAT until it was sold to Kaplan in 2009.
Lee: How did each of you become engaged in the program?


Bosche: Andrew Yang, the Founder of Venture for America visited Dartmouth for an info session, and I was excited at the opportunity to make an impact through start-ups.
Nussembaum: I too heard about VFA at an info session at my alma matter, Wesleyan University, when I was a senior year. I was intrigued by Andrew’s presentation, but ultimately it was meeting the other Fellow candidates that convinced me to join. I’d never met such an amazing group of smart, talented, ambitious people, and I knew I had to do whatever they were doing.
Rudolph: At Emory, I was heavily involved in entrepreneurship; I was president of the Emory Entrepreneurs Network and an Executive Fellow of the Kairos Society. I heard about VFA through the grapevine of the Kairos Society and applied immediately.
Lee: Is it a small business boot camp concept or something different? How long is the program and what happens when you complete it?
Nussembaum: At its core, VFA is a job placement program with training, mentorship, and an amazing network. Fellows are essentially just regular employees of their companies (they’re paid by their companies, not by VFA). But VFA is about so much more than just getting a job. Throughout the two-year Fellowship, there are tons of opportunities for Fellows to learn and grow through projects outside of work—for example, the Innovation Fund, where Fellows raise money for projects in their cities through crowdfunding, with the top fundraisers receiving additional money from VFA. (The Innovation Fund is how Rebirth Realty, our home restoration project, got started.) Fellows do all kinds of things after the program. The vast majority stay involved with startups in some fashion: some, like us, start businesses; some continue working at their placement companies; and some move on to other startups, either in other VFA cities or in more traditional places like Silicon Valley.
Lee: And how did it benefit your business? Specifically, what tools did it provide for you?
Bosche: VFA was the reason I started Slope. Without the access they provided to mentorship, investment, and resources, I would not have been able to start a company. After the program, fellows have the opportunity to go through a Venture for America Accelerator with access to mentors and investment.
Nussembaum: VFA changed my life, and there’s no way I would have started Castle without it. I really do feel like I learned how to start my own company by working at another startup. VFA also provided us with a network of mentors through which we raised early-stage capital, and got crucial advice and support. Most importantly, though, it was through VFA that I met so many other amazing Fellows, who have become confidants, co-founders, and lifelong friends.
Rudolph: VFA has played a significant role in nearly all of our company milestones. It’s almost too many to count. From our first retail relationship (Meijer) to our appearance on CNBC’s Reality TV show Restaurant Startup, VFA had a helping hand. We’re now closing a round of funding, and while I can’t announce it yet, I am amazed at some of the people investing in Banza. I can’t thank the team at Venture for America enough for helping us make it happen.
Lee: What I find interesting is you’re all young entrepreneurs and you’re not from Detroit. What was it about this city which appealed to you and why did you decide to establish your business here? What did your friends think when you said you were starting a business in Detroit?


Nussembaum: Detroit is a great place for Castle for two main reasons. The first is cost-of-living: at an early-stage start-up, employee salaries are far and away the most significant expense. You can live well in Detroit without too much money, and that makes a huge difference. Secondly, our customers at Castle are primarily individual real estate investors, and Detroit real estate is exploding right now. The closer you can be to your customers, the better off you are.
Bosche: Most of my classmates went to Boston, New York, or San Francisco after graduation, and were intrigued by my decision to come to Detroit. The opportunity to make a mark in a rebuilding city attracted me here. Everyone who lives in Detroit is here to make a difference and help develop the city in a positive way. Because the community is small in Detroit compared to New York or San Francisco, we had the opportunity to become a part of a strong group of business leaders who have a great interest in seeing us succeed.
Rudolph: It’s a great place to start a company. Hands down. My cost of living is low and, as someone who is easily distracted, I find that the environment particularly great for focusing. I love it.
Lee: If others are reading this and wondering whether or not to start a business but are not sure where to start, what advice would you share?


Nussembaum: The best businesses all emerge from real-life problems their founders face. You shouldn’t start with “deciding to start a business.” Instead, find something about the world you believe needs to be improved, then figure out if a business is the best way to attack that problem. You’ll never feel like you’re completely ready to start a business—I still don’t feel ready, and I’ve been doing it for a few months now! All you can do is dive headfirst into the deep end and figure things out as you go along.
Bosche: The best advice I can give is find people you love to work with. Starting a business is one of the most difficult things you can do, and can only work if you are working with the right people. Dan and I have a close relationship that takes us through all the ups and downs of a startup, and it allows us to continue to grow.


Rudolph: Learn from the best. If you want to start a business in a particular space, find entrepreneurs who did successfully before. Cold call them. Email them. Do everything you can to learn how they did it right. Everyone can benefit from mentorship; I can’t tell you how much of a difference it’s made for me.