Detroit’s renaissance seems undeniable, and it’s a brilliant thing to see for anyone who’s passionate about the future of urban America.
Many people have written about the collapse of Detroit’s automotive plants, and the city’s population decline. But not as many people have shared the growing momentum of Detroit’s comeback. While other Rust Belt cities muddle along, visionary leaders have renewed the Motor City. It’s in shared moments like Detroit Homecoming where the true spirit and scale of the city’s ambition can be seen on full display.
One of the latest steps in this vision is Ford’s purchase of Alchemists Collective’s assets, including The Alchemy in Corktown. To recognize this and other huge steps in Michigan’s business comeback, event founders Jim Hayes and Mary Kramer organized the fifth annual Detroit Homecoming in mid-September. I had the honor to attend and speak briefly about my investment in the city.
Detroit Homecoming is Inspiring
Back in 2013, during a meeting with Mary at the Detroit Athletic Club, we discussed the embryo of the idea that would become Homecoming, and I helped her team at Crain’s generate the initial list of VIP invitees. The aim of Homecoming was to engage Detroit “expatriates” in ongoing revitalization efforts, by reconnecting them with community leaders and inspiring them to invest in the homeland.
It’s become so much bigger in its programming ambition in the four years since the first one, and I’m always impressed with the caliber of people that turn up. I love reconnecting with talented people that I’ve had the pleasure to work with or know over the years. Although we may have met in places far from Detroit, we seem to naturally gravitate to each other.
As you would expect with an event of this stature, Michigan luminaries like Mayor Mike Duggan and Ford Chairman Bill Ford, Jr. were on hand to discuss current developments and future plans. They were the stars of opening night, which included a dinner reception on the floor of Little Caesar’s Arena, the new home to Detroit’s beloved Pistons and Red Wings. It was reaffirming to hear these two men talk about the acquisition of my business and the vision we share for the city. We may miss the gritty ice rink of Joe Louis Arena, but bringing this new marvel to Detroit is key to downtown’s new mixed-use sports and entertainment districts. And bringing the Pistons back from the suburbs for the first time in nearly 40 years isn’t too shabby, either!
On opening night, we also heard from Detroit’s growth catalysts, Dan Gilbert, as well as StockX CEO/Founder Josh Luber. StockX is an impressive story — it’s a booming marketplace for luxury goods. Did you hear about the guy in the Bronx with a $40,000 sneaker collection? As someone who shares this shoe fetish, I can imagine how this company could appeal to collectors. The sneaker collector’s story is similar to many stories of people being served by this rapidly growing Detroit startup.
As Denmark West — chief investment officer of Connectivity Ventures Fund — told me: “The signs of Detroit’s resurgence are plentiful: The arts scene, real estate development, big businesses setting up offices, a growing startup ecosystem… I‘ve watched StockX grow from a couple guys in a closet to over 400 employees in just a couple years. Not only is this a compelling startup growth story, but it’s also an awesome jobs generator. I look forward to doing more with groups like Detroit Venture Partners and Invest Detroit.”
StockX is one example of what’s truly promising about the Motor City renaissance. These entrepreneurs aren’t just doing it for themselves; they’re impacting their community. I look forward to hearing more about social impact investing at Connectivity Ventures Fund during their annual meeting this month in New York.
During dinner, I had the good fortune of sitting next to one of the leaders responsible for much of the technology-startup growth in Detroit. Ned Stabler is president of TechTown Detroit, a thriving hub for entrepreneurship. They announced Marlin Williams, a Fortune 500 diversity executive, has joined as chief program officer to run technology and entrepreneurship initiatives there and at Wayne State University. This kind of partnership is critical for making new inclusive markets in the region. I look forward to exploring how I can support the ongoing growth of this program and its entrepreneurs with Ned.
Throughout Homecoming, many of us networked and celebrated at the Detroit Foundation Hotel, which operates a hip downtown facility for visitors with the help of “collaborators” — local craftspeople that provide everything from the employees’ uniforms to artisanal chocolates in the rooms. Bob Lambert, the GM of the hotel, and his wife are gracious hosts. I encourage you to consider staying at or visiting the next time you’re in Detroit. One night while I was there, I ran into fellow female founders Nia Batts and Katy Cockrel from Detroit Blows, a beauty salon that supports female entrepreneurs through its sister organization Detroit Grows. While they’re still a young startup, they’re already considering expansion.
Businesses like these need capital, support, and mentorship. Carolyn Cassin, managing partner of Belle Capital, invests in traditionally underserved women founders who are more likely to build businesses that contribute to their communities. Carolyn also announced a new $10M fund for women entrepreneurs via her Michigan Women Forward. I can’t wait to see Carolyn again when I return to Detroit to determine how I can support other female founders while I’m back for Techstars Mobility Demo day, where I’m a mentor.
Although I was born in Detroit, I currently live in the San Francisco Bay Area where I run my new startup Sensai. It was great to see so many of my Bay Area neighbors, including Jill Ford, who leads Toyota AI Ventures and has served as an advisor to the Mayor’s office on innovation and entrepreneurship since 2014. Given her automotive technology focus, it’s obvious that she will be able to continue to make an impact in the city from afar.
I also met John Duffy at one of the evening events. John is a donor, investor, and adviser in various Detroit initiatives including the Detroit Food Academy. I was surprised to learn that he lives just around the corner from me in California! I hope to meet up at one of our favorite local restaurants to discuss collaborating on future projects.
Homecoming has become a home run for the city. In fact, other cities are copying the model.
What’s Happening in Detroit?
A few years ago, at the Mackinac Policy Conference, I shared a vision of creating a global smart mobility hub in Corktown. I proposed a program that identifies government, education, big business, and local startup entrepreneurs who can create exciting new projects that will help Detroit develop new ventures and turn them into new sources of profit, resulting in a renewed interest in the area that attracts further investment and retains talent.
The vision wasn’t about creating a business. It was about creating a new market entirely. I executed on this vision for years, working with BP, Castrol, and others at Prehype — a venture development firm where I’m a partner — and also through my Corktown-based company the Alchemists Collective, where we invested in and developed new smart mobility ventures throughout the world.
Seeing this plan come together has been very gratifying, especially when the plan requires a complicated alliance among business, community, capital, and government. And the government’s role isn’t just local; it also requires federal involvement, and like it or not, it’s always political. I met with Brandon Dillon, chairman of the Michigan Democrats, who is pioneering digital modernization of the party. We talked at length about social media, digital outreach, my startup Sensai, and what we did to support the insurgent Michigan gubernatorial campaign of Abdul El-Sayed. (If you’re a Democrat like me, and you want to support the #BlueWave, you can donate here.)
Michigan’s economy is reliant on non-partisan collaboration and exceptional leadership within all parties. The city and the state have some strong Democratic candidates who I support. It’s always interesting to see which way Michigan swings in any election.
The Detroit renaissance is reinvigorating the entire state, which is blessed with some fine universities in livable college towns. We were treated to a talk by Dug Song, co-founder of security technology company Duo. Dug and his co-founder Jon Oberheide built a pioneering enterprise two-factor authorization. Duo went from being a tiny startup to Michigan’s first “unicorn” — Silicon Valley talk for a private company valued at over $1B — to selling to Cisco for $2.35B. Duo’s story is important for many reasons, but especially to give students and entrepreneurs a local example to learn from and aspire to. Unlike some of my peers in the Valley and elsewhere, success hasn’t spoiled Dug and others in the region. Michiganders don’t need Kendrick Lamar to remind them to be humble. As Dug says, “California is a wine state and Michigan is a beer state.” That sums up some of the cultural differences I experience flying back and forth. I have to say, I love both.
My experience working with small businesses and artists in Detroit inspired my decision to found Sensai, which helps small businesses, artists, athletes, and other creators get real results from their social media marketing. When I heard stories from artists trying to make a living without having to get corporate jobs, like Ellen Rutt’s story, I knew I had to do something to help. When I looked at the landscape for marketing management software, I saw big players focusing on professional social media managers, enterprise marketing departments, and agencies, but nobody is really focusing on the problems of small business owners who must stay focused on the day-to-day operations of their businesses.
We know that SMBs drive all local American economies, and by partnering with Sensai, we can go beyond together and exceed our business expectations. Together, we can make a difference in our communities by growing our businesses, elevating the tax base, and creating more jobs. To help Detroit’s small businesses and economy, I extended a limited special offer to Homecoming participants and local businesses offering 50% off of any subscription level of Sensai for two months. You can take advantage of that offer by using code DETHOM18 at www.getsensai.com.
I was also fortunate to speak about Detroit and Sensai on Chad Livengood’s podcast Detroit Rising. Sensai customer Stefanie Kwiatkowski, founder of Barre’letixx — which sells specialized, flexible shoes for barre, yoga, pilates and water sports — joined me on the podcast. Sensai has worked with Stefanie to help her brand get more exposure on social media, and she’s grown her social media following by 166% since signing up in January of 2018. More importantly, that growth has come from actual customers rather than fickle followers.
We love her business so much we feature Stefanie’s testimonial on our home page: “The Sensai platform is phenomenal! The Professional service provides relevant posting advice to help increase engagement for my business. Within 7 weeks, my Instagram followers jumped up more than 200%!”
We’re fortunate to have such a dynamic customer as Stefanie. She’s also a fan of the Homecoming events.
“The parties that were happening every night were priceless,” said Stefanie. “Detroit has seen so much growth in the last five years! There is a huge difference from when I moved downtown nine years ago.”
You Can’t Have a Modern City without Great Music and Food
Detroit isn’t only about motors and mobility. It’s also about music, and the recent tragic loss of Aretha Franklin was a reminder of all that Motown has contributed to the sound of America. The event would be amiss without highlighting local talent since music runs through our veins. This year, Homecoming attendees had the absolute pleasure to hear one of Detroit’s favorite homegirl’s Bettye LaVette perform. It’ll be great to see her again at the Venture Crush AV event I’m attending in New York.
The Detroit Music Foundation supports the local music community and promotion of Detroit as a music destination. My fellow DMF Board Members, Howard Hertz and Joe Bellanca — who clearly earned the designation “super-lawyers” for the music and entertainment industry — were among many of us who enjoyed Bettye’s performance at the new Corner ballpark in Corktown near my properties and the new Ford campus in development. They’re two of many passionate players who support the growth of a healthy ecosystem for musicians in Detroit.
Motown Records may be historic, but the future of Detroit’s scene is great, and not just because Eminem and Big Sean keep dropping hits.
The artists coming out of Assemble Sound are redefining genres. Located near the old train station where Ford is developing its smart mobility campus, this artist development studio is the heart and soul of the city’s re-emergence as a music destination. Assemble is a good example of Detroit’s success with attracting more creative entrepreneurs to the city to partner with local talent. Former Chicagoan Garret Koehler moved to the city and began working Indie darlings Flint Eastwood ,which spawned a whole new cottage industry in music where local artists have access to a top-notch studio, creative community, programming, and opportunities to make more income from their music. This is becoming a new platform for what a music label could look like without the baggage of past unworkable models. Flint Eastwood was filming their next video during Homecoming and it promises to be a must-see. Have you listened to Tunde Olaniran yet? You must see him live. When I was driving across the Golden Gate Bridge heading to the airport to participate in Homecoming, I listened to a new playlist Spotify curated for me. Wouldn’t you know it, I was tapped in and tuned into Tunde. In addition to being one of the most dynamic stage performers on tour, he was one of Sensai’s first customers! As an artist, he gets the importance of having an authentic impact on people regardless of the medium. Sensai helps him achieve that through social media while enabling him to spend more time making music. My vision for Sensai is that we can help engender more empathy in the world and he’s an artist that exemplifies that.
Another talented artist who embodies the power of positive vibes and who performed at last year’s Homecoming is the powerfully poetic Mike Ellison who says he is “inspired by the growing number of African-American stakeholders and innovators not only participating in Homecoming, but also investing in people and projects across the city.”
Mike performed in the first promo video for audio technology company MQA, led by another great Detroit music man Mike Jbara. It’s pretty cool to see these local guys create intimate music moments on a global stage. I had the pleasure of hearing the unreal audio quality coming out of MQA at SXSW last year during a live stream from London. When I closed my eyes, it felt like I was in Abbey Road Studios down the road from my London home.
One of the things I love most about going back for Homecoming is the anticipation of tasting new Detroit delicacies at new restaurants that didn’t exist the prior year. No story of urban regeneration is complete without a glut of new eating and drinking experiences. I recall my waitressing days at Mexican Village when there weren’t the diverse options available today. Former New York music label maverick, Ping Ho, now owns and operates possibly the finest wine bar in the city, The Royce, where many of us imbibed in the best reds around. I live near Napa and spend several weeks a year with our family in Italy, so it’s fair to say my standards for a scintillating red are high. I’m always sated and pleasantly surprised by the range and quality of wine they serve at The Royce without the pretense you often find elsewhere. Building on the success of The Royce, this entrepreneur is opening a butcher shop/restaurant called Marrow, which is set to open in just a few weeks. Ping is a Singaporean who moved to Detroit via NYC to participate in the comeback. Like many domestic and foreign immigrants to Detroit, part of the motivation of risking it all and starting a new business is that there is a feeling of being in it together that comes with growing your business in parallel with an entire city and seeing your success contributing to the community. It becomes bigger than you and your business.
Ping said it succinctly: “I’ve met people who care a lot about the city’s comeback and have been supportive of what I’m doing. People are creative and they really do hustle. I love the entrepreneurial can-do spirit of the Detroiters whom I’ve met, and they make me hopeful for its long-term success.”
This fall, I’m eager to try Grandma Bob’s Pizza an artisanal pizzeria and bar in Corktown on the ever-expanding Michigan Avenue. I may even try a glass of wine at Provisions soon to open in Eastern Market, but I’ll pass on the charcuterie for some vegan options elsewhere. Some other hotspots to check out while you’re in the city are:
Wright & Co. While Downtown check out one of my favorite menus designed by their James Beard-nominated executive chef and partner, Marc Djozlija, who creates seasonal menus around a shared plate concept.
The Peterboro Head to Detroit’s historic Chinatown in Midtown to experience a cool and casual restaurant serving contemporary American Chinese cuisine in an urban Asian atmosphere.
Honest John’s Bar & Grill With the ever increasing options of new food and beverage venues it’s important not to miss out on “old school” Detroit. When you’re dining at this casual bar/restaurant serving breakfast anytime say “hi” to my nephew, Connor!
Bad Luck Bar Head to Capital Park to experience the tiny yet intriguing clandestine cocktail bar featuring upscale, imaginative cocktails made with rare and unusual liquors in posh, intimate surrounds. Enter off the alley through the door with the serpent. I love Detroit venues that you can only find if you’re “in the know” and that’s how this place was before it became so popular.
Willis Show Bar While in Midtown, if you are dressed appropriately, the Willis Show Bar in Detroit’s Historic Cass Corridor, Willis Shas been reborn as an upscale cabaret and classic cocktail bar. Proper dress required.
The Sugar House Bar One of the first newcomers to Corktown after I bought my properties, this is a local favorite. Detroit’s original craft cocktail bar nominated in the top 20 bars in America by Esquire magazine located near the new Corner ballpark and Ford smart mobility campus in development.
Detroit’s original craft cocktail bar nominated in the top 20 bars in America by Esquire magazine located in Corktown near the new Corner ballpark and Ford smart mobility campus in development.
Mutiny Bar Before or after dinner at El Barzon in Southwest, head to the newest “dive” tiki bar in Detroit and try to survive craft cocktails with names like “Monkey Punch,” “Poseidon’s Fury,” and the popular two-person “Scorpion Bowl.”
Detroit is More Than Downtown
There are now many hotspots throughout the city. These fun destinations beyond downtown are examples of the ever-expanding entertainment destinations. One of the many things I admire about Homecoming, and what Mary, Jim and their team have done, is extend its range beyond downtown. We were frequently reminded about just how big, broad, and diverse this wonderful city is. The smartest investment opportunities reside in these neighborhoods.
I was intrigued by Matt Temkin’s presentation launching the Detroit Opportunity Fund to invest in a $500M pipeline of multifamily and commercial development projects in Qualified Opportunity Zones in Detroit. He enthusiastically offered this explanation:
“Subject to certain limitations, the gains produced by investment in the Detroit Opportunity Fund will be tax-free. The Opportunity Zone program was signed into law as a part of the Tax Cuts and Jobs Act of 2017, and in April 2018, the State of Michigan nominated certain low-income census tracts across the state (including several in Detroit) for certification as Opportunity Zones. These tracts were certified as Opportunity Zones by the U.S. Treasury Department in May 2018. Detroit’s Opportunity Zones include much of the Central Business District, Midtown, Southwest and Villages neighborhoods. Investments into these and other Opportunity Zones are made via Opportunity Funds. Investors may roll capital gains into Opportunity Funds, deferring and eliminating taxes in the process similar to how a 1031 works, I assume. North Coast Partners has been investing in multifamily projects in Detroit over the last five years, primarily in the Midtown and Villages neighborhoods. Its Detroit Opportunity Fund will focus primarily on these areas as well.”
Opportunity Fund Investing — How it Works:
- Sell any capital asset (e.g., stocks)
- Roll gains from asset sale into O-Fund
- O-Fund invest in O-Zones
Tax Benefits for Investor:
- Deferral: Defer payment of taxes due on gains rolled into O-Fund until 2026
- Basis Step-Up: Reduce taxes due in 2026 by 10–15% (30% including TVM)
- Elimination: O-Funds gains tax-free after a 10-year hold. Tax free!
If you’re serious about investing in anywhere in Detroit, then you might replicate the success of other investors and developers or build upon my experience by working with my team for whom I’m grateful. I worked with the tireless Mike Koeningbauer from Friedman Real Estate and the best lawyer I’ve ever worked with in the state of Michigan, Arthur Siegal from Jaffe. And you can keep your hands off my other key team member Alfreda Bowden Clark who supports me in all my business ventures and thus largely responsible for any success I achieve. Investing in Detroit neighborhoods can be especially tricky if you’re not working with the right people.
Among my favorite neighborhood events in these areas and elsewhere were the “House Parties,” which extended from Arden Park to Midtown to Indian Village to the West Side. Each returning expat got on a bus, which took us to a mystery location, so we got to experience more than just the central events. These intimate events allowed us to get to know people in a truly relaxed and intimate way.
What a fantastic event overall. As a proud Detroit native, I’m excited to return!