Inside Detroit’s Nascent Start-Up Culture

Forget Mark Zuckerberg. The entrepreneurial kids of Detroit want to make money while doing good.

Gabriel Craig, owner of the Smith Shop metalworking studio in Detroit's 'Ponyride' building, finishes a piece of custom silverware.
National Journal
Tim Alberta
Feb. 26, 2014, 5 a.m.

This art­icle is part of a weeklong Amer­ica 360 series on De­troit.

DE­TROIT — It star­ted as a school pro­ject for Ver­onika Scott, who at age 20 was study­ing design down­town at the Col­lege for Cre­at­ive Stud­ies. One of Scott’s pro­fess­ors chal­lenged stu­dents to cre­ate a design that would meet people’s “needs” in­stead of just fol­low­ing “trends.” So, Scott, a nat­ive De­troiter with a tough up­bring­ing, began tour­ing home­less shel­ters to get ideas. After months of these vis­its, Scott de­veloped a pro­to­type of a thick, wa­ter­proof winter jack­et with an in­teri­or that un­folds in­to a sleep­ing bag.

She was con­vinced her cre­ation could be par­layed in­to a full-time en­ter­prise. So in 2011, Scott launched a non­profit or­gan­iz­a­tion called the Em­power­ment Plan. The goal was not just to make coats and dis­trib­ute them to the home­less free of charge, but also to hire home­less moth­ers to do the pro­duc­tion work. Today, thanks to Scott’s vis­ion and a gen­er­ous net­work of donors con­cen­trated in Metro De­troit, the Em­power­ment Plan churns out 500 jack­ets per month and em­ploys 18 full-time work­ers, most of them re­cruited from loc­al shel­ters. “And none of them knew how to sew when they came here,” Scott, now 24, says.

Scott’s suc­cess may be unique, but her mis­sion is not. She is part of a sprawl­ing net­work of so­cially con­scious young people in De­troit who are earn­ing a live­li­hood by launch­ing start-up en­ter­prises — either for-profit or not — geared to­ward re­build­ing the com­munity around them.

“There is an ab­so­lute drive among people of this gen­er­a­tion to pos­it­ively im­pact the out­come in their en­vir­on­ments,” says Dan Gil­bert, founder and chair­man of Rock Ven­tures;the bil­lion­aire’s um­brella com­pany now owns more than 40 prop­er­ties in down­town De­troit. “And it’s not just some purely greedy cap­it­al­ist thing, with a guy look­ing at spread­sheets. They have this mor­al­ist­ic view.” Gil­bert, who cut a check to the Em­power­ment Plan for $250,000 after meet­ing Scott at a phil­an­thropy event, has also giv­en mil­lions of dol­lars in seed money to oth­er so­cially aware start-ups around the city.

Stud­ies have shown mil­len­ni­als are flock­ing to urb­an cen­ters na­tion­wide, and they are es­pe­cially drawn to work­places and neigh­bor­hoods where they can quickly be­come part of the so­cial fab­ric. De­troit, with its shattered out­er neigh­bor­hoods, in­ex­pens­ive real es­tate, and low cost of liv­ing is emer­ging as ground zero for this move­ment of young, com­munity-con­scious urb­an en­tre­pren­eurs.

Phil Cooley knows this bet­ter than most. A Michigan nat­ive who more than a dec­ade ago fled the state for col­lege in Chica­go, Cooley, 35, re­turned to a city des­per­ately in need of in­vest­ment. After team­ing with oth­er in­vestors to open the now-boom­ing Slows Bar-B-Q res­taur­ant, Cooley saw an op­por­tun­ity in 2011 when a massive aban­doned build­ing went on the mar­ket in Cork­town, De­troit’s old­est neigh­bor­hood and one ex­em­pli­fy­ing its epi­dem­ic of aban­don­ment. Cooley patched to­geth­er loans and pur­chased the struc­ture for $100,000.

He was de­term­ined to prove a point to the deep-pock­eted spec­u­lat­ors who had swooped in and bought the city’s va­cant build­ings at clear­ance prices only to let them sit idle. If such spaces were made avail­able to cre­at­ive res­id­ents, Cooley thought, amaz­ing things could be ac­com­plished. “We just really wanted to see what would hap­pen if De­troiters has ac­cess to this land­scape again,” Cooley says. “We need to find that in­nov­a­tion here again. We look to Har­vard and Stan­ford so of­ten, and it frus­trates me. I love Har­vard and Stan­ford. But the people of De­troit, when they have op­por­tun­ity, are just as in­nov­ate and just as cre­at­ive. We just need to open up the pro­cess.”

Today, his hy­po­thes­is is prov­ing cor­rect. Cooley’s build­ing, called Ponyride, is packed with more than 60 small busi­ness and non­profit groups. Ten­ants are offered a heav­ily sub­sid­ized rent for their work­space — most pay between $100 and $250 per month — so they can fo­cus on product de­vel­op­ment and com­munity en­gage­ment. But there’s a catch: Or­gan­iz­a­tions in­side Ponyride must work with the broad­er com­munity for hun­dreds of hours each year, of­fer­ing in­struc­tion­al classes in everything from sew­ing to crop cul­tiv­a­tion to metal­work­ing.

Less than three years after Cooley pur­chased this de­crep­it build­ing, Ponyride is a bust­ling hub of en­ter­prise and en­gage­ment. Some of the busi­nesses are young and not yet prof­it­able, but their en­thu­si­asm is con­ta­gious. There’s a long wait­ing list for space, and Cooley and his army of “so­cially con­scious” en­tre­pren­eurs are do­ing their best to make room for re­in­force­ments.

One per­son already here is Gab­ri­el Craig, who along with his wife owns and op­er­ates Smith Shop, a metal­work­ing stu­dio in the base­ment of Ponyride. Like many of the young en­tre­pren­eurs here, Craig grew up in the sub­urbs but has roots in the city. His grand­fath­er was a Wayne County sher­iff, and his par­ents grew up in De­troit. Craig and his wife moved in­to the city, opened a busi­ness, and hired three em­ploy­ees. On top of par­ti­cip­at­ing in Ponyride, Craig’s busi­ness has partnered with the Vet­er­ans Af­fairs’ De­part­ment to of­fer weekly metal­work­ing classes to vet­er­ans of the wars in Ir­aq and Afgh­anistan.

Craig says he loves De­troit today be­cause the city has be­come a mer­ito­cracy, where people who work hard and think cre­at­ively can get ahead: “The cur­rency here isn’t who you know or what you look like any­more. It’s what you’re do­ing. De­troit is sick of people talk­ing about do­ing something. If you’re ser­i­ous about help­ing, roll up your f — ing sleeves.”

Across town, Andy Didorosi agrees. An­oth­er nat­ive of De­troit’s sub­urbs, Didorosi, 26, says the city of­fers the rare com­bin­a­tion of fer­tile ground for en­tre­pren­eurs and strong com­munity sup­port. “People here are mak­ing their own jobs. It’s not big com­pan­ies or big fisc­al blue­prints cre­at­ing them,” he says. “And it’s an awe­some cul­ture in De­troit. Chica­go doesn’t care about you. Brook­lyn doesn’t care about you. Here, you’re in the driver’s seat.”

As a young en­tre­pren­eur, Didorosi got his big break when he learned that Ferndale, a town just north of De­troit, was selling its fleet of old school buses at bar­gain-base­ment prices. He bought four of them for less than $10,000 total. He cleaned up the buses, had them in­spec­ted, and hired a loc­al group of artists to paint them with designs that cel­eb­rate the city. Then, in Janu­ary of 2012, Didorosi launched the De­troit Bus Com­pany. Today, the busi­ness em­ploys 15 drivers and six oth­er full-time em­ploy­ees, and of­fers a vari­ety of trans­port­a­tion ser­vices, in­clud­ing shuttles in and out of the city, long-dis­tance charter trips, and rent­als for wed­dings and oth­er spe­cial oc­ca­sions. The com­pany also partnered with the Skill­man Found­a­tion last year to give school­chil­dren on De­troit’s west side free rides to their after-school pro­grams — a ser­vice that now provides bus­ing for more than 4,000 De­troit kids.

These are just a few ex­amples of De­troit’s emer­ging start-up cul­ture, in which phil­an­thropy meets en­tre­pren­eur­i­al­ism. Today, these young com­munity in­dus­tri­al­ists — street-smart, tech-savvy, and so­cially con­scious — are de­term­ined to re­build De­troit one busi­ness and one neigh­bor­hood at a time. Or, as Cooley, the founder of Ponyride, likes to say, “It takes a vil­lage to start a cof­fee shop.”

What We're Following See More »
STAFF PICKS
After Wikileaks Hack, DNC Staffers Stared Using ‘Snowden-Approved’ App
5 hours ago
WHY WE CARE

The Signal app is fast becoming the new favorite among those who are obsessed with the security and untraceabilty of their messaging. Just ask the Democratic National Committee. Or Edward Snowden. As Vanity Fair reports, before news ever broke that the DNC's servers had been hacked, word went out among the organization that the word "Trump" should never be used in their emails, lest it attract hackers' attention. Not long after, all Trump-related messages, especially disparaging ones, would need to be encrypted via the Snowden-approved Signal.

Source:
WARRING FACTIONS?
Freedom Caucus Members May Bolt the RSC
7 hours ago
WHY WE CARE

The Republican Study Committee may lose several members of the House Freedom Caucus next year, "potentially creating a split between two influential groups of House conservatives." The Freedom Caucus was founded at the inception of the current Congress by members who felt that the conservative RSC had gotten too cozy with leadership, "and its roughly 40 members have long clashed with the RSC over what tactics to use when pushing for conservative legislation." As many as 20 members may not join the RSC for the new Congress next year.

Source:
SOME THERAPIES ALREADY IN TRIALS
FDA Approves Emergency Zika Test
9 hours ago
THE LATEST

"The U.S. Food and Drug Administration on Monday issued emergency authorization for a Zika diagnostics test from Swiss drugmaker Roche, skirting normal approval channels as the regulator moves to fight the disease's spread." Meanwhile, the Wall Street Journal reports that a new study in Nature identifies "about a dozen substances" that could "suppress the pathogen's replication." Some of them are already in clinical trials.

Source:
MONEY HAS BEEN PAID BACK
Medicare Advantage Plans Overcharged Government
9 hours ago
THE DETAILS

According to 37 newly released audits, "some private Medicare plans overcharged the government for the majority of elderly patients they treated." A number of Medicare Advantage plans overstated "the severity of medical conditions like diabetes and depression." The money has since been paid back, though some plans are appealing the federal audits.

Source:
DESPITE CONSERVATIVE OBJECTIONS
Omnibus Spending Bill Likely Getting a Lame-Duck Vote
10 hours ago
WHY WE CARE

"GOP leaders and House Democrats are already laying the groundwork for a short-term continuing resolution" on the budget this fall "that will set up a vote on a catch-all spending bill right before the holidays." As usual, however, the House Freedom Caucus may throw a wrench in Speaker Paul Ryan's gears. The conservative bloc doesn't appear willing to accept any CR that doesn't fund the government into 2017.

Source:
×