Quicken Loans Detroit Demo Day will return for a second round in June with a new funding model that aims to level the playing field for entrepreneurs to compete for $ 1 million in rewards.
The pitch competition has been split into three different revenue categories that will allow businesses of different “weight classes” to compete for funding from the Detroit mortgage giant. The Startup, Growth and Scale classes will offer hundreds of thousands of dollars in grants, interest-free loans, and equity investments, respectively.
In last year’s competition, each finalist competed for interest-free loans. The change was made this year as his team finds the best way to serve Detroit-based entrepreneurs, said James Chapman, director of entrepreneurship for Quicken Loans Community Investment Fund.
“Just learning from year one, we asked all of the finalists who participated about their experiences,” he said. “We just wanted to make it a more level playing field. If you’re someone who’s just started competing with someone who’s been around before, that’s not really fair.”
There are seven main prizes up for grabs, but up to 10 companies could win in the pitch competition. The starting category offers three prizes up to $ 100,000, Growth has three prizes up to $ 250,000 and the Ladder category has a prize of $ 300,000. A public vote will award an amount of $ 25,000 to a winning pitch in each category. The three People’s Choice awards are not included in the $ 1 million prize bucket.
Applications for the pitch competition, available on detroitdemoday.com, are open to entrepreneurs or businesses in Detroit that commit to relocating to the city, until April 22. Organizers draw to crown the 600 submissions received for the inaugural contest. A panel of representatives from QLCIF, business and the Detroit community will reduce the number of finalists to 15 finalists by June 4.
The finalists will present themselves to a panel of national entrepreneurs in front of a live audience at Music Hall in downtown Detroit on June 22. The organizers are assembling a panel of judges to review the nominations, Chapman said.
For-profit companies vying for a spot in the Detroit Demo Day must have a product or service ready to sell, according to the press release. Eligible businesses must have no more than $ 1 million in capital and no more than $ 2 million in annual revenue.
“You can reapply if you haven’t won before,” Chapman said. “If you win you can’t. You have to focus on what you have for a few years.”
Social Club Grooming, a Midtown hair salon, took home the top prize of $ 200,000 and the public’s prize of $ 25,000 at the inaugural contest in May. Detroit Training Center, Ash & Erie, RecoveryPark Farms, Eli Tea, The Farmer’s Hand, Social Sushi, and Good Cakes and Bakes won smaller prizes.
Eli Tea, a Birmingham store that secured a $ 100,000 loan, is looking for space to open a store in Detroit, with help from Detroit Demo Day organizers, Chapman said. Officials do not give relocation deadlines, given the challenges of finding a suitable location for a business.
The Quicken Loans investment fund team provides ongoing support to the pitch winners, Chapman said. The group meets with each company monthly and holds quarterly events that bring the cohort together to meet mentors, discuss best practices and reflect on experiences.