The idea for Detroit Venture Partners (DVP) was conceived as Josh Linkner, Dan Gilbert, and Brian Hermelin spent months thinking of ways to foster talent in the region. Around two years ago, the team pulled the trigger and decided to devote their careers mentoring and investing in entrepreneurs. DVP invests in technology companies at a seed and early-stage level that have goals of creating something big while solving major customer problems.
The Detroit Venture Partners team have a plethora of reputable entrepreneurial experiences. Josh Linkner is a New York Times best-selling author, the founder of ePrize, and a professional jazz guitarist. Dan Gilbert is the founder of Quicken Loans, owner of the NBA’s Cleveland Cavaliers, and chairman of Rock Gaming. Brian Hermelin is a founding Partner of Rockbridge Growth Equity and serves on the board of directors at numerous companies and institutions. In July 2011, NBA superstar Earvin “Magic” Johnson invested in DVP and joined as a general partner.
Detroit Venture Partners has invested in 17 companies so far including Detroit Labs, Are You A Human?, UpTo, Stik, Roqbot, and LevelEleven. Most of these companies are housed in the M@dison building, located in the center of downtown Detroit. The M@dison was designed by Doodle Home and Neumann Smith. The building used to be a worn-out theater, but it has been converted into a space containing spacious conference rooms, creative artwork, a large auditorium, and a rooftop patio that faces Comerica Park. Detroit Labs, one of the first tenants of the M@dison, has been growing at a rapid pace and is already looking into potentially expanding their office space.
When Detroit Venture Partners analyst Jim Xiao was asked what DVP looks for when investing in a company, he told me that they look for “teams that click.” The companies that they invest in must be willing to be coached and take in feedback. He also recommended that if you are not ready to pitch, it is best hold off and ask for advice first. Xiao said that “great investors recognize patterns” and are good at determining if a business can be scaled.
Before joining DVP, Linkner started the digital engagement agency ePrize in 1999. ePrize was sold to private equity company, Catterton Partners, in August 2012. Linkner stepped down from the CEO role of ePrize in February 2010 and co-founded DVP in November 2010.
Linkner’s journey as an entrepreneur was tumultuous at times, but he was able to overcome obstacles and persevere. One example of adversity that Linkner faced was around the time that the dot-com bust happened. Venture capital companies were panicking about their investments and ePrize was no exception. “Our venture capitalist pulled funding from us and it was a very close call,” said Linkner. “We had an all-company meeting scheduled one day and I literally did not know if I would be able to clear the paychecks.” Fortunately a wire transfer from a venture capitalist came in that same day. Linkner said that it takes “grit, scrappiness, and determination to fight these types of battles and it makes you stronger as a company.”
Sometimes entrepreneurs have to pivot their business models in order to adjust to changing environments. Linkner said that “great entrepreneurs adapt.” Linkner said that when he first started ePrize, he was not interested in working with big brands. Soon he realized that if he stuck to working with only small businesses, then the company may not have survived. When signing deals with Fortune 500 companies, ePrize changed the way that they produced and documented everything.
Many college students that go to local universities like the University of Michigan or Michigan State University end up applying for jobs that are out of the state. I asked Linkner why he believed that Detroit was an important place for students to consider as they prepare to enter the workforce. He said that when moving to big cities like San Francisco, Chicago, or New York, it is easy to “get lost in the shuffle.” By working in Detroit “there is an opportunity to really stand-out and leave a fingerprint while turning around a great American city.”
The reflections of DVP are echoed in the city of Detroit’s official motto: ”We Hope For Better Things; It Shall Rise From the Ashes.”
Amit Chowdhry, Forbes.