All for one: Collaboration forms to boost Midwest hardtech startups

A new regional partnership has received $900,000 in federal funding to help Midwest energy-related tech startups scale, attract capital, and drive economic development. 

The money is part of a $9.5 million U.S. Department of Energy initiative to support 10 incubator and accelerator programs within cleantech “innovation clusters.” 

Partners in the Midwest Regional Innovation Partnership (MRIP) include Chicago’s Clean Energy Trust, which serves as the prime funding awardee; the Centrepolis Accelerator at Lawrence Technological University in Southfield, Michigan; hardtech and manufacturing innovation center mHUB in Chicago; and Spark Innovation Center at the University of Tennessee Research Park. Some of these organizations previously had informally worked together on smaller projects, but they formally created MRIP to solidify the relationship for the DOE funding and to advance future regional cleantech opportunities.

They also connected with Chain Reaction Innovations at Argonne National Laboratory in Illinois and Innovation Crossroads at Oak Ridge National Laboratory in Tennessee to serve as project affiliates.

“We felt like we also needed a better connection of our assets, capabilities, and funding with the national labs,” said Dan Radomski, executive director at Centrepolis Accelerator. “A lot of the cleantech companies that are early stage quite often need testing and validation, especially if it’s hardware-based… That testing is done at the national labs.”

MRIP aims to increase the number and speed of Midwest energy- or emissions-focused hardtech startups reaching commercialization while increasing manufacturing jobs to drive the regional economy. The 360 businesses MRIP intends to support include those developing technologies for microgrids, next-generation solar or wind power, and next-gen batteries. 

This type of partnership aligns well with DOE goals and potentially could result in the group collectively landing more funding than each entity could achieve separately, said Erik Birkerts, CEO at Clean Energy Trust. “They really want to have their dollars be catalytic and to create something that is lasting, not something that ends when the funding ends. One of our milestones… is to ensure there is a sustainability component built into our partnership,” he said.

Overcoming obstacles

The Midwest’s innovation centers are more dispersed and often hundreds of miles apart, compared with denser hubs such as Silicon Valley or the Northeast, Birkerts said. The geography makes it more challenging for those with capital to connect with Midwest tech startups. For example, it is possible for an investor searching for promising startups to visit some in Chicago, Detroit, Madison, Wisconsin, Minneapolis, and Columbus, Ohio on the same trip, but it is more cumbersome and time consuming than visiting a one-stop-shop region like the Bay Area in California.

“That’s been somewhat of a problem that has hindered the Midwest in its ability to be as prolific in startup creation, venture funding, and capital formation,” Birkerts said. “The geography makes it really hard to identify, access, and attract the funding, attention, and support that these companies require… But all those discrete points add up to a really compelling number.”

MRIP also melds each partner’s unique expertise and lets them leverage the other partners’ strengths. This helps expand their reach into other regional markets. 

“There are only so many companies in Michigan that can take advantage of this, because there’s only so much cleantech hardware innovation in any state. So if we’re going to scale this… we need to be open to promising companies outside the state of Michigan. The partnership allows us to do that,” Radomski said. “Between us and mHUB, we’re one of the few hardware-based product development entities in the Midwest.” 

More than money

The accelerators offer startups support beyond just funding. Virtual and in-person services include mentorship, product design guidance, networking events, and general startup business guidance. They’re also trying to help educate startups and established small businesses about the funding available through the Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs and how to apply for it.

“Notoriously, the Midwest does not have a very good track record of going after and being awarded SBIR grants,” Radomski said. “The technology here is amazing and definitely worthy of the high-tech, feasibility-related project funding that SBIR awards.”

MRIP partners consider their formation and the DOE funding the first steps to making the Midwest a more robust cleantech powerhouse.

“The Midwest has such great assets — with its universities, national laboratories, the entrepreneurial community — and we can really start harnessing those assets and drive a lot of terrific activity… I think there can be even more great stuff happening if we unify and start working in concert,” Birkerts said.