Early Stage Partners to open Ann Arbor office

Early Stage Partners, a Cleveland firm that invests in young technology companies, is opening an Ann Arbor, Mich., office as part of an agreement to receive $13 million from an economic development organization in that state.

Early Stage received the money from Venture Michigan Fund on the expectation that it invest a large majority of it within the state, though there is no requirement that it all be invested in Michigan companies, said Jonathan Murray, a managing partner with Early Stage. Venture Michigan Fund invests in other funds that commit to financing companies within the state.

Early Stage plans to hire a professional investor to staff the office full time. It has focused mostly on investing in Ohio, though the firm looks at investments from throughout the Midwest.

None of Early Stage’s previous investments have been located in Michigan, Mr. Murray said. However, the state should be a good fit for the firm’s investment strategy, he said, adding that he believes neither Michigan nor Ohio have enough early-stage capital to meet the needs of startup companies worthy of investment.

“We thought the model we’ve successfully executed in Ohio would transport to Michigan,” Mr. Murray said.

Early Stage previously had worked with Credit Suisse First Boston, the firm managing Venture Michigan Fund’s money. Two of the firm’s managing partners — Mr. Murray and Jim Petras — are University of Michigan graduates.

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