Michigan Startup Fundraising: Q3 2025

At the end of Q3 of 2025, the total amount of funds raised by startups across the state of Michigan was $141m according to data from Dealroom. As the first state we’re looking at in these Q3 updates over the next week, the unfortunate result is not exactly the rosy story we hear from our local cheerleaders.

This was the lowest quarter since Q1 2024, and the fourth-lowest in the last 23 quarters since the start of 2020. It also compares poorly with the last quarter, a $2.2B outlier that oddly had its own question marks and issues, and with the same quarter of 2024 of $1B.

This was in stark contrast with the macro fundraising situation across the country and much of the world.

The total amount almost doubled quarter-over-quarter and year-over-year to $80.2B, against $48.4B in Q2 of this year and $48.8B in the first quarter of last year.

This was led - as you’d expect - with outsized volumes concentrated in California and funneled into a small handful of AL-leading companies: Anthropic, OpenAI and xAI. Two other lightning-rod states followed suit, Massachusetts with $3.7B and New York with $8.3B both roughly doubled QoQ which underscores how top-heavy the national fundraising rebound remains.

This led some prominent investors to refer to conditions as ‘frothy’.

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The situation in Michigan told a different story: broadly distributed sure, industry-diverse definitely… but disappointingly modest in size. The top five deals alone accounted for $133M across security, health, manufacturing, and energy; with remaining raises adding ~$8M.

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What does it all mean?

Michigan zigged while the nation zagged, but not in that good ‘we’re doing things differently’ kind of way. National capital surged but was highly concentrated.

Concentration vs. diffusion. The 2025 rebound - reaching numbers that haven’t been seen since the heights of 2021-22 - so far isn’t trickling down evenly. Compared to that outlier period, there’s less variation in who gets funded, which industries and where, even if headline totals look similar. Trickle-down economics - in startup form - this is not… yet.

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Volatility still rules our local leaderboard. One or two mega-events can whipsaw quarter-to-quarter comps. Michigan is a great example. We’ve not included % differences in this write, because honestly they’re not even worth reporting. 10% of year on year numbers? No thanks. Michigan’s Q3 lacked a tide-raising outlier, hence the marked trough.

Last quarter’s comparison stirred some debate amongst our readers about whether large convertible or structured financings should ‘count’ when we talk about startups. Our stance is consistent: if dollars are reported by the experts in this field, in our case being the data from Dealroom, then we talk about it. These dollars fuel Midwest companies, teams, and jobs. Consequently, that means celebrating the surges and owning the slowdowns.

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What can we expect in Q4?

The first two quarters of the year were excellent for startup fundraising in Michigan. A stellar Q4 could still put the stare within striking distance of its record total in 2022. It would likely require one substantial later-stage or strategic round plus steady mid-market activity. 

In the current environment, sometimes anything seems possible.

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