Fact of the Week: Michigan Saw the Largest Growth in VC Investment of Any State Between 2016 and 2020

Source: Metinko and Teare, “More Opportunity Than Capital: Venture Dollars Spread Throughout the US,” Crunchbase News, May 20, 2021.

Commentary: Between 2016 and 2022, the amount of venture capital (VC) investment in Michigan increased by 889 percent, more than twice as much as North Carolina, the state with the second-largest relative increase over that period (409.6 percent). This was driven by a staggering 725 percent increase in VC investments in Michigan between 2018 and 2019. Michigan’s largest VC-backed industries include life sciences and business-to-business software services.

Michigan’s growth is indicative of a more general geographic dispersion of VC dollars. While the top five states by total VC investment still include the usual suspects (California, New York, Massachusetts, Texas, and Washington), 2016–2020 growth was especially strong in states like Colorado (304 percent), Minnesota (208 percent), Georgia (142 percent), and Ohio (136 percent).