Detroit has a secret … it’s not the zombie apocalypse we’ve all been duped to believing. We’ve all seen the pictures of the Packard Automotive Plant, left abandoned and void of windows since the 1950’s and heard about the drop in population to less than half. It’s depressing.
Despite the changes in the automotive industry over the past fifty years, and its affect on the people and lifestyles of Detroit, it is a city that continues to evolve, adapt and innovate through these tough economic times. Despite the financial analysts and naysayers, Detroit is making a comeback sparked by young entrepreneurs and creative problem-solvers looking to leverage a very unique economic situation.
The Poorest Big City in the U.S.
It’s true … Detroit has been called the “poorest big city in the U.S.” in recent years. The city was directly affected by the rise and fall of the automotive industry in North America, eventually filing for Chapter 9 bankruptcy in 2013 (to the tune of 18 to 20 billion dollars). In addition, according to the 2015 Census, nearly 300,000 people in Detroit live below the poverty line (just over 39 percent of the population living on $24,250 a year). To top it all off, the unemployment rate (as of October 2016) is just over 11 percent. The national average is just under 5 percent.
This all may sound very somber … but it’s actually GOOD NEWS!
When Detroit qualified for Chapter 9 bankruptcy it essentially got a “new lease” and could negotiate a plan for adjusting its debts and refocusing its efforts on growth rather than just keeping its head above water. In the end the numbers have improved since 2013 as the unemployment rate has gone down (from 22 to 11 percent), and according to Forbes magazine, Detroit is one the fastest growing entrepreneurial communities in Michigan. In fact, while numbers have decreased nationally, the number of venture capital (VC) firms, the amount of capital under management and venture investment has nearly tripled in the last five years.
A Legacy of Greatness
Since its humble beginnings, Detroit has always been a place for innovation and change. As the hub of automobile manufacturing in the early 1900’s, the “Motor City” became the global symbol for modern advancement and the growth of an entire industry. The “Big Three” automobile firms – General Motors, Ford Motors, and Chrysler – were headquartered in metropolitan Detroit and fuelled an industry that provided hundreds of thousands of people with good paying jobs. Before the decentralization of automotive manufacturing in the 1950’s, Detroit had become the fifth largest city in the United States.
With a rich music legacy, Detroit is the birthplace of Berry Gordy, Motown Records, and “Motown” music. The music style that emerged from this record label introduced the world to Stevie Wonder, Diana Ross and the Supremes, Lionel Ritchie and the Commodores, the Jackson Five, Michael Jackson, and so many more. The influence of Motown has since shaped various genres of music including R&B, doo-wop, soul, pop, rock and roll, and rap.
Given the name “The City of Champions” in the 1930’s, Detroit is no stranger to the sports scene and is home to four professional American sports teams (only 12 cities in the U.S. have teams in all four major North American sports):
- Detroit Lions (NFL) – 4 NFL Championship titles (before the Super Bowl was established in 1967)
- Detroit Tigers (MLB) – 4 World Series Championship titles
- Detroit Pistons (NBA) – 3 NBA Championship titles
- Detroit Red Wings (NHL) – 11 Stanley Cup titles
This is a city that knows how to roll up its sleeves, fight for what it believes in (against the odds), and win. I believe Detroit is on its way back to greatness again … in business, art, and culture.
Bright Lights, Big City
Okay … it may seem like a bit of a “stretch” but the city certainly has the structure and framework needed to become a leading major city in the future. First, let’s get the facts straight … Detroit, Michigan still qualifies as a big city for the following reasons:
- At its peak, in the 1950’s, the population in Detroit exceeded 1.85 million people (down to 701,000 in 2013, and on the rebound),
- Currently, Detroit is home to several Fortune 500 companies (including General Motors, Ford Motors, Lear, Penske Automotive Group, DTE Energy, Ally Financial, PulteGroup, and Kelly Services),
- Detroit has two (2) universities (Wayne State University and University of Detroit Mercy),
- Detroit has one of the country’s top six museums, the Detroit Institute of Arts (featuring more than 100 galleries, covering 658,000 square feet, including works by Diego Rivera and Vincent Van Gogh)
- Detroit has four (4) professional sports teams (Detroit Lions, Detroit Tigers, Detroit Red Wings, and the Detroit Pistons),
- Detroit has three (3) television stations (WJBK-TV, WDIV-TV, and WXYZ-TV),
- Detroit has two (2) daily newspapers (The Detroit News and Detroit Free Press),
- Detroit has several restaurants under the watchful eye of Zagat and is identified as one of America’s next hot food cities, and
- Many famous celebrities were born in Detroit (Diana Ross, Francis Ford Coppola, Eminem, Judy Greer, Tom Selleck, and Christie Brinkley).
According to the Detroit Economic Growth Corporation, downtown Detroit has added over 16,000 employees since 2010, the vacancy rate has significantly decreased and 9 billion dollars have been invested in real estate projects in Greater Downtown. The Motor City has been, and continues to be, a destination location with a lot of potential for visitors and new residents looking for a fresh start!
As the city is recovering from the Chapter 9 bankruptcy of 2013, the city has become favourable for entrepreneurs looking to start up a profitable business. You can get a house or storefront far cheaper than any other city in the country and there are several programs available to help entrepreneurs launch successful businesses in the city. Check out just a few of the organizations supporting entrepreneurial growth in the Motor City.
- Detroit Kitchen Connect – Detroit Kitchen Connect exists to help food entrepreneurs overcome the high cost of setting up a commercial kitchen and opening up a successful food business. This organization provides a supportive, diverse, inclusive community along with access to commercial, licensed kitchen facilities and equipment in a reduced risk environment.
- Detroit Venture Partners – Detroit Venture Partners is a venture capital firm that backs seed and early stage startup teams with the grit, creativity, and passion to tackle and mold opportunity. This organization consists of passionate entrepreneurs who know how to build successful companies from the ground up. They offer mentorship and a portfolio of services to accelerate the growth of any business.
- Grow Detroit – Grow Detroit is a community of ambitious young entrepreneurs and professionals in Southeast Michigan (Greater Detroit + Ann Arbor regions). This organization hosts events and promotes news with the goal of helping startups grow and thrive in Southeast Michigan.
- Motor City Match – Motor City Match helps new and expanding businesses at all stages of opening a business in the city of Detroit. This organization offers business planning classes, matching businesses with quality commercial properties, architectural and design support, and $500,000 in grant funding each quarter.
- New Economy Initiative – The New Economy Initiative is a $134-million philanthropic program building a network of support for entrepreneurs and small businesses in metropolitan Detroit. This organization’s strategy targets innovation and entrepreneurial support, building physical spaces for ideas to thrive, and attracting new talent to further grow Detroit’s economy and that of surrounding areas.
- ProsperUS Detroit – ProsperUS Detroit is an entrepreneurial training and small business lending program for Detroit residents designed to empower low and moderate income, immigrant and minority individuals and neighborhoods. By helping emerging entrepreneurs develop successful businesses, ProsperUS helps strengthen neighborhood economies, create jobs, serve residents with new goods and services, and cultivate community-based leadership.
- Rock Ventures – Rock Ventures is the umbrella entity of more than 100 companies, and is committed to investing in the people and communities in Detroit and Cleveland. The goal of the organization is to create opportunity and prosperity in these communities by investing capital to create more jobs, bringing new life to a building, activating a public space, and more. They believe that if they can do something that will affect positive change in these communities … they will do it.
- TechTown – TechTown is Detroit’s most established business accelerator and incubator, offering a full suite of entrepreneurial services for both tech and neighborhood enterprises. This organization helps startups and established businesses develop, launch and grow, while strengthening and diversifying Detroit’s local economy.
ABOUT THE AUTHOR
Andrea Oh is an accomplished writer, published author, podcaster, and local blogger in Calgary, AB (Canada). Follow her adventures at www.sixfootcanasian.ca or on Facebook, Instagram, and Twitter (@sixfootcanasian).