Recently, The New York Times featured an op-ed touting benefits of both the newly created Michigan Invests Locally Exemption (MILE) and the newly enacted law allowing for Michigan Investment Markets.
Together, these two laws establish equity crowdfunding in the Great Lake State and create the framework for an in-state stock exchange — and they could have a huge impact on Michigan’s economic recovery.
According to the op ed, early in the 20th century, many big cities — including Boston, Milwaukee, San Francisco and even Detroit — boasted their own local stock exchanges. But after the stock market crashed in 1929, the federal government imposed strict regulations on publicly traded companies, essentially ending the demand for local stock exchanges.
This shift also made it harder for small and local businesses to find and secure investors — until recently. With the MILE and the Michigan Investment Markets in place, in-state investors looking to help grow local and regional businesses can do just that, benefiting the state’s economy and helping new businesses open their doors for the first time.
In Michigan, the Detroit Stock Exchange helped rev up the infant auto industry in the early 1900s, providing growth capital to innovative start-ups like General Motors and the Maxwell Motor Company (now Chrysler).Who knows, [with these news laws in place] a Detroit stock market could someday rise again. Or a Lansing market, or a Grand Rapids market.
–Amy Cortese, New York Times op-ed contributor
The MILE has already helped one company meet its crowdfunding goals. In May, the Tecumseh Brewing Co. reached its goal of $175,000 from local investors, and hopefully more companies will follow suit soon.
And now with the Michigan Investment Markets, buyers and sellers of stocks in companies like the Tecumseh Brewing Co. also have a place to trade those securities.
It’s an exciting concept for Michigan’s continued economic recovery. As bill sponsor Rep. Nancy Jenkins said, “New businesses bring new jobs to our state, attract more tourism and bolster our entire economy.”