Businesses have varying capital needs, based on the timeline to profitability as they progress through various stages of development. Michigan is strategically filling the stages of the business-development lifecycle with appropriate and adequate forms of capital. For instance, technology-intensive firms, whose early developmental stages are typically longer than those of other firms, require more equity or risk capital to make it through what is known as “the valley of death.” Firms that begin generating sales revenue sooner still need access to more traditional forms of capital to launch and grow their businesses. Match your current business position with the capital tools Michigan has available.
During this initial stage the innovator has a new product or technology advancement with seemingly positive market potential. However, the innovator has limited financial resources and business expertise to commercial the product.
The final design of the product is complete and an initial business plan is developed. The management team is incomplete and there are no product revenues.
The company continues to develop the product prototype with the goal of completion. Significant expenses are incurred at this stage with no product-related revenues. This stage is usually the low point in the “valley of death.”
The company has limited revenue while the product is being introduced to the market.
The company is in full production with the product and expanding distribution. Management is transitioning into a formal organization structure.
The company is well-established in the market place and must continually innovate to stay competitive.