In small-scale manufacturing, winning a contract is when the issues start.

A small manufacturer in Michigan finally lands an order it has been chasing, from a buyer whose name you might recognise. A defence prime, an aerospace OEM, maybe an auto supplier. This is the good part.

It is also usually the moment that business has issues that most at the top-end of the process are blissfully unaware of. The buyer pays on net-45, sometimes net-90 terms. The metal, the labor and tooling must all be paid now. And when the company asks a bank to bridge that gap, the bank often looks over their thin balance sheet and single large contract, and declines. Politely. The order that was supposed to be the breakthrough for a fledgling business can become a cash-flow trap.

This is the part of re-industrialization that the systems and supply chains which served us well in the mid-20th century have not yet caught up on, and it is the part that two companies — one a fintech, the other a contract manufacturer — have built a partnership around trying to solve. The fintech, Klear, recently announced it has financed more than $100m through its platform across aerospace, defence, energy and autonomous-systems supply chains. The manufacturer, Kinetyc, steers the small companies for whom it builds towards Klear to help manage the finance of those builds.

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The missing middle

The biggest barrier to ‘re-industrialization’ may well be this gap between idea, blueprint, prototype… and the ability to actually manufacture. In the era of vibe-coding, that’s an issue. Anyone can build anything now, we’re being told. Just as long as it isn’t something physical.  

"Purchase-order financing is virtually non-existent," Drew Leahy, who runs sales at Klear, told us, "and the world doesn't really know that." A company doing $15m in revenue can get a purchase order financed. A company filling its first orders cannot.

Klear's answer is to flip the equation: "we underwrite transactions, not companies," Leahy said. "We underwrite customers, not the people who are actually building those companies … a bank wants enough revenue, enough this, enough that, enough years of business … we're able to work with that ‘unbanked’ industrial supply base that's too small" When a small firm like this is owed money by a household name-level buyer, Klear buys that receivable outright - a true sale, taken off the supplier's balance sheet - and waits to be paid by the large, creditworthy buyer. The supplier gets cash today; Klear holds the risk on a counterparty that will always end up paying, but oftentimes on terms that make cashflow difficult for small businesses.

Leahy refers to it in passing as "21st century factoring," and while the comparison is fair, he adds that it runs cheaper than the factoring most small manufacturers have been quoted, and that it is bolted onto software which lets Klear’s customers see cash coming in and going out, pay vendors, and hold a balance. Klear runs the accounts through Fifth Third Bank of Cincinnati, Ohio, and has added a foreign-currenct desk. This allows its customers to buy and sell effectively to anyone, anywhere in the world. None of this is especially revolutionary, except for the fact that no one had yet assembled these pieces together for small and mid-sized industrial suppliers, who had been treated as too small to bother with by traditional financing.

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Why this makes sense in the Midwest

Scott Cieslak runs Kinetyc and - usefully - actually has a background in finance himself. "Development money is coming into the Midwest," Cieslak told us, "and once it gets to the level to actually scale and manufacture, it's heading back out … the objective here is to have everything remain local by allowing the ecosystem to be to not have to go south, not have to go out to the west coast, but keep everything here. Make it so that … when new tech is developed in the Midwest, it stays local because you don't have to go find the relevant pieces anywhere else." The region is good at the front of the pipeline — incubators, hard-tech grants, seed and early venture money. It is the next step that leaks. A founder with a working prototype and a contract discovers that the cheapest place to actually manufacture, and the easiest place to finance it, might be somewhere else. “I think a lot of the startups are not getting into the next step,” Cieslak adds. “Because [it’s] great to come up with an idea, great to come up with a product design, hard to manufacture at scale repeatable and that isn't just putting it together and assembling it. That's supply chain management. That's working capital management. That's long-term sustainability”

Kinetyc is a two-year-old division of Voltava, the tier-one auto supplier formed in December 2025 out of Detroit Manufacturing Systems, Android Industries and Avancez, which has become one of the larger privately held assemblers in the country. The idea is to take what a century of Michigan car-building taught the region about value-added assembly, supply chains and quality systems, to aim it at drone manufacturing, energy storage, EV charging and the rest of a nascent hard-tech wave. Its 100,000-square-foot floor in Wixom allows a startup that has won an order to build their product without standing up its own factory. The partnership with Klear lets that same startup finance the order, without locking up its own cash. Between these two services, they help lower the barrier to becoming a manufacturer for the smallest of organizations.

“One of our goals is to take 15 startups and make them scaleups in the next three years,” Cieslak says. It’s an ambitious number and timeframe, but also valuable that the goal even exists in a portion of the economy that is oft-overlooked in a narrative wave of ‘high-growth startups’ and ‘rustbelt’ regions. 

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The bottom-up version of small-scale manufacturing

When Right to Start brought its small-scale-manufacturing event to Newlab in Detroit last month, its founder Victor Hwang argued that the next era of American manufacturing won't necessarily be won by the states that subsidise the biggest players, but by the ones that build the broadest base - makers, tinkerers, industrial startups making physical things at small scale. The keynote speaker at that event, Ilana Preuss of Recast City, talked about filling empty storefronts with small-batch production facilities. The common thread with this and what Klear and Kinetyc are working on, is that capital access is a barrier that can decide whether anything can even get off the ground at all.

These are unglamorous problems - who finances an order, who builds it, where it is built - all attempting to be solved close enough to a founder that they don't have to leave the region to actually build something: a widget, a business.

The Midwest has never struggled to invent things. The question that will most likely decide whether ‘re-industrialization’ actually takes place is whether it can afford to manufacture what it invents, and help keep the companies here that do. 

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