coordination/collaboration : Innovation + Job News

The U of M’s Carlson School of Business hosted its annual Tech Cities conference on March 27. The event drew hundreds of local innovators, investors and social entrepreneurs to the West Bank on the University of Minnesota campus in search of answers to a simple but vexing question: “How can we strengthen and promote MSP as a source for tech leadership, talent and innovation?”
 
The packed “Supporting Innovators in the Tech Cities” workshop offered a glimpse of the problems the region faces — and offered hope that workable solutions are within reach.
 
According to Matt Lewis, Greater MSP Strategy Manager and workshop moderator, MSP could produce “tens of thousands of jobs by 2020” that the region currently lacks the talent to fill. This “talent gap” is mostly due to two structural forces.
 
First, the accelerating pace of technological change is dramatically reordering the economy, rewarding highly skilled professionals and tech-savvy innovators while challenging those who don’t acquire new, relevant skills. This shift is happening everywhere, but it’s more pronounced in regional hubs like MSP (i.e., the capital of the North), where much of the tech economy’s most exciting, cutting-edge advances are forged.
 
The second structural force is unique to MSP: Despite a strong economy, reasonable living costs and excellent quality-of-life metrics, the region perennially struggles to attract the country’s — and world’s — best and brightest. The upside is that once transplants find their way here, they tend to stick around.
 
“The cliche that it’s hard to get people to come here and even harder to get them to leave holds true,” Lewis noted at the workshop. “We need to change the conversation and make [MSP] a global destination for people who self-identify as innovators.” Doing so would solve both problems: the technological talent gap and MSP’s “attraction issue.”
 
Four self-identified innovators who already call MSP home piped up to offer their ideas. Scott Cole, co-founder of the local tech cooperative Collectivity, proposed a “comprehensive tech accelerator” that would combine and magnify the efforts of existing local initiatives like the Minnesota High Tech Association, Greater MSP, MN Cup, university-based tech groups and others. The ultimate goal: to create a pervasive culture of innovation wherein cash-strapped innovators with great ideas effortlessly connect with investors, mentors and customers.
 
Melissa Kjolsing, MN Cup director, highlighted the tech world’s persistent gender gap — an issue that has gotten plenty of press in MSP and elsewhere. She noted that while women run 30 percent of all U.S. companies, most are solo operators. The solution: “deeper peer networks for women,” she argued. Women entrepreneurs need positive role models, namely successful female business owners who have made it through the male-dominated startup gauntlet. 
 
Kjolsing noted that though MN Cup has yet to achieve parity, the prestigious tech competition is spearheading the drive to empower women entrepreneurs: In 2014, about one-third of MN Cup entries came from all-women teams, up from 25 percent the previous year; 45 percent of 2014’s teams had at least one woman on the roster.
 
Lee George of the James J. Hill Reference Library argued that MSP must do more to support ambitious people at the two biggest “pinch points”: the moment when the entrepreneur moves from tinkering with an idea in their spare time to quitting their day job and fully plunging into their startup; and the exit strategy, or the point at which the entrepreneur steps away from the company he or she founded to focus on a new project or simply “cash out.”
 
Without support from mentors, investors and talented employees, many entrepreneurs never make it past the first pinch point, and their dream either dies or goes into a long slumber. Meanwhile, those fortunate enough to be able to contemplate an exit strategy often don’t know how to forge the connections with leaders of the established firms that typically buy up successful startups. It’s worth noting, for instance, that though MSP has a deep bench of Fortune 500 firms capable of financing numerous buyouts, one of the region’s most successful startups — SmartThings — turned to a Korean firm (Samsung) for its exit.
 
George advised existing organizations like Greater MSP and MHTA to adjust their programming in two ways: creating better and more numerous mentorship opportunities for soon-to-be-full-time entrepreneurs, and deepening connections between successful startups and major firms.
 
David Berglund, the fourth speaker, exemplifies the power of connections between MSP’s startup community and established business players. He’s UnitedHealth’s “entrepreneur in residence” and co-founder of Hoodstarter, a real-estate crowdfunding app. At UnitedHealth, he’s more or less in charge of “building healthcare startups from the ground up.”
 
“We need to accelerate the pace of innovation in large, sometimes bureaucratic corporations,” he said. “To do that, we need to get off the corporate campus and out of our comfort zone.”
 
Berglund believes that MSP’s major corporations need to communicate better and experiment more, both with one another and with the region’s entrepreneurs. Knowledge — and knowledge sharing — is power, after all. Berglund’s dream: an MSP in which big companies, successful small businesses and fledgling startups “forge partnerships and come together without fear of stealing each other’s ideas.” Such an outcome could accelerate the pace of business formation here and transform MSP into a truly global innovation hub.
 
 

Confluence Capital, the groundbreaking MSP venture capital (VC) fund, is now Matchstick Ventures. The rebrand comes amid a flurry of other changes announced early last month, notably the addition of several high-profile investors and advisors.
 
New investors, according to Minneapolis-St. Paul Business Journal, include Seth Levine, managing director at Boulder-based Foundry Group, a venture capital fund; Lisa Crump, co-founder of Eden Prairie-based digifab giant Stratasys; Scott Burns, CEO of St. Paul-based GovDelivery, a software communication platform that serves government organizations; and Darren Cotter, founder of St. Paul-based online rewards company InboxDollars. Advisors include Levine and Joy Lindsay, principal at Minneapolis-based StarTec Investments.
 
But why “Matchstick”?
 
“The ‘Matchstick’ name rings truer to the entrepreneurs and startups that we exist to serve,” says founder and managing director Ryan Broshar, who also founded beta.mn and Twin Cities Startup Week. “Our goal is to act as a catalyst — not just for the companies we invest in, but for MSP’s startup economy as a whole.”
 
To date, Matchstick/Confluence has invested in 14 early-stage companies. Though most are headquartered in the MSP area, there are a few outliers: Denver, Seattle, Chicago, St. Louis, and Lincoln, Nebraska. Far from diluting Matchstick’s local potency, Broshar sees these wayward investments as central to the fund’s mission: “evangelizing” MSP’s emerging tech ecosystem.
 
“We talk up the region every time we interact with out-of-market clients and prospects,” says Broshar, adding that his company gets at least one inquiry from outside entrepreneurs or VC funds who’ve heard about Matchstick and are excited about what’s happening in MSP. “Interest in the Twin Cities is definitely gaining momentum.”
 
“The writing is on the wall for MSP’s startup scene and capital ecosystem,” he adds.
 
Broshar should know what an up-and-coming tech hub looks like. He lived in the Denver-Boulder area in the late 2000s and early 2010s, when the Front Range’s tech economy was blowing up. Broshar threw himself into the local scene, parlaying a pending MBA at UC-Boulder into a gig as a consulting firm principal. He networked with and advised ambitious Front Range entrepreneurs for a few years, then turned his focus to finding and investing in early-stage companies through partnerships with the Foundry Group and other local VCs.
 
When he moved back to MSP in fall 2012, Broshar found the same entrepreneurial energy he’d grown accustomed to in Denver-Boulder. But with few notable VC firms and a relatively conservative commercial financing ecosystem that eschewed risk, many local startups had to look elsewhere for capital.
 
“We’re blessed with a lot of gritty entrepreneurs who just go to work and get stuff done, rather than talking about what they have yet to do,” says Broshar. “But even the most talented and ambitious entrepreneurs can’t survive without capital,” along with the mentoring and peer support services provided by organizations and initiatives like Broshar’s beta.mn and Twin Cities Startup Week.
 
“The goal was, and still is, to put MSP on the map,” he says.
 

Cologix, one of the country’s most prolific data center operators, recently unveiled a new state-of-the-art facility in Downtown East’s 511 Building, the company’s MSP headquarters. According to a company press release, the 28,000-square-foot hub has space for more than 250 server cabinets and upward of 70 network connections, making it the most connected piece of real estate between Chicago and Seattle — the Internet capital of The North.
 
“People think of the Internet as this ethereal cloud,” says Graham Williams, chief operating officer, Cologix. “But in reality, that cloud is very solid. The world is crisscrossed with untold miles of fiber optic cables and dotted with servers, routers and switches. That physical infrastructure — the Internet’s plumbing — intersects at data hubs like [the 511 Building].”
 
The heart of Cologix’s new facility is the Meet Me Room, the hub where the networks actually intersect. Clients who rent space in the facility can pick and choose which networks to use. The setup is akin to a co-working space: Tenants pay to be there and provide their own equipment, but they get access to most of the service providers operating in MSP.
 
They also enjoy lower latency (faster connection speeds), which is particularly important in the video streaming business. “We enable companies like Netflix to get closer to their end users,” explains Mike Hemphill, general manager of Cologix’s Minneapolis facility. “They’re pushing copies of the shows and movies people want to watch to their servers here in Minneapolis, rather than calling everything up from California and traversing thousands of miles of fiber to get here.”
 
Increased competition for clients in the Meet Me Room reduces’ service providers’ pricing power by as much as 20 to 40 percent, says Williams. But it’s a worthwhile tradeoff. The alternative is an expensive, piecemeal approach wherein providers lay fiber all the way to clients’ offices, wherever they might be located. Depending on the fiber’s final cost per mile, directly connecting to clients could end up being less cost-effective than using a facility like the 511 Building.
 
Cologix’s new data center also houses the Midwest Internet Cooperative Exchange (MICE), a nonprofit, donation-supported network exchange used by smaller Internet service providers and telecoms as well as data-hungry content providers like Netflix. MICE was devised in 2010 to improve MSP-area bandwidth and connection speeds, and to level the playing field for smaller operators. FWR Communications, Cologix’s predecessor in the 511 Building, donated a modest square footage to house MICE’s first servers; with more than 50 participants at last count, MICE is now a major Cologix tenant.
 
“It’s an exciting time to be in this business,” muses Hemphill, whose telecommunications career has spanned nearly a half-century. “I’ve had more fun in the last decade than at any time previously.”
 

Visual, a Northeast Minneapolis startup run by co-founders Chuck Olsen and Taylor Carik, has an ambitious vision for “social VR,” a blend of social media, virtual reality and everyday experience. The company’s current app, an interactive social dashboard that hovers in an immersive, computer-generated 3D environment, will soon be available on two virtual reality headsets: Samsung’s Gear VR, an affordable consumer model, and Oculus’s DK2, a higher-end device ideal for gaming.
 
Visual’s app grew out of Futurekave, a far-reaching “virtual world platform” developed by Olsen and Carik. To help build it, the pair tapped Dual Reality Games, a group of talented app designers with members in MSP and Oregon. Users sync their social media profiles with the app, manipulating photos, posts, tweets and profile information using a keyboard or touchpad. Visual only works with Instagram at the moment, but other social networks are in the works.
 
Social VR’s time has come, explains Olsen. “Facebook is hiring 1,200 employees right now,” he says, “many of whom will be working on building a VR presence for the company.”
 
“But Facebook [and other tech companies like Apple] aren’t VR natives, like we are,” he adds. “That puts them at a disadvantage.”
 
As a small, lean startup, Visual is more nimble than Facebook et al. And as possibly the first independent social VR company anywhere in the country, Visual is uniquely positioned to take advantage of what Olsen and Carik believe will be a fundamental change in the public’s relationship with mobile computing and connectivity.
 
In the short term, VR is about to get a lot more accessible. Samsung is planning a big consumer push later this year for its $200 Gear VR headset, a goggled apparatus that syncs up with the Note 4 smartphone’s screen to immerse wearers in a 360-degree VR. Thus far, the Note 4 is the only piece of hardware that works with Gear VR, though (according to Olsen) that’s not as big of an obstacle as it seems.
 
“[Gear VR] is going to be under Christmas trees this year,” predicts Olsen. “If you’ve got a free phone upgrade, it’s not a huge commitment to get a Note 4 and then buy the headset.” And Samsung may tweak the Gear VR interface to work with other mobile devices, he adds.
 
Visual’s social VR app is also compatible with the DK2, a similar headset device from Oculus, the company responsible for many of the recent advances in VR interfacing.
 
In both cases, the headset experience is incredibly lifelike, with realistic sound, HD-quality video and just-barely-perceptible lag when the user moves his or her head. The big drawback, explains Olsen, is that VR is not yet interactive: You can move your head to look at different parts of the virtual environment, but you can’t reach out and manipulate your surroundings.
 
Visual’s social VR system could solve, or at least mitigate, the interactivity problem. Olsen and Carik imagine headset-wearing concert-goers using Virtual’s app to post real-time images and video with friends who aren’t at the event, or meet and engage with other social VR users who are present. While users wouldn’t actually be able to manipulate the performers or anything else about the environment, they’d be able to process and share it socially.
 
Olsen, Carik and the Dual Reality Games crew aren’t placing all their eggs in the headset basket, of course. Longer-term, they’re interested in the concept of augmented reality: a virtual, Internet-connected field of vision overlay, like a much more advanced version of Google Glass. They see Visual as a “hardware agnostic” app that can handle the social element of augmented reality, which some technology experts believe is the future of mobile Internet — the post-smartphone world.
 
“Imagine having your social dashboard in the corner of your living room, waiting for you to engage with it,” says Olsen. “That could really be powerful.”
 

 
Rising costs and inconvenient delivery modes beset healthcare consumers. Thompson Aderinkomi, a trained economist with an MBA from the University of Minnesota’s Carlson School of Business, has a novel solution.
 
His new startup, Retrace Health, offers at-home, on-demand consultations and care from licensed doctors and nurse practitioners, either by videoconference or in-person visit.
 
Retrace has grown rapidly since its late 2013 launch, when the company had a roster of about 40 patients, mostly Aderinkomi’s friends and family members. The company began accepting corporate clients in June 2014: Aderinkomi now counts at least seven client companies, ranging in size from a few hundred to a few thousand employees, whose employees can tap Retrace’s services. Between individual and corporate clients, Retrace now brokers “double-digit weekly consultation counts,” says Aderinkomi.
 
According to Aderinkomi, convenience — the fact that patients don’t have to drive to a clinic or hospital and sit in a waiting room for hours on end — is a huge factor in Retrace’s success. “We’ve found that once people try Retrace and realize how seamless the process can be, they use us more than they’d use a regular doctor or care provider,” says Aderinkomi.
 
Retrace’s doctors and NPs keep longer hours than a typical health clinic. Video consults are available 6 a.m. to 10 p.m. on Mondays, and 6 a.m. to 6 p.m. Tuesday through Friday. In-person consults occur from 10 a.m. to 3 p.m. Monday through Friday.
 
For simple issues, users can schedule a three-minute video consultation and be on their way. For more complex problems, a 30- or 60-minute home visit may be necessary. Retrace’s care providers can schedule same-day appointments with as little as 60 minutes’ notice, though off-hours requests need to wait until the following business day.
 
Retrace users also value the company’s untimed appointments. Whereas a traditional clinic might schedule 15 or 20 daily appointments per doctor or NP, Retrace’s care providers don’t have such heavy workloads. A lighter workload allows care providers to linger longer with each patient, answering questions and addressing issues that might normally get pushed aside due to time constraints.
 
Financially, Retrace isn’t out of reach for most patients. Individual patients who want to pay through their insurance provider (Retrace works with most providers) don’t have to pay anything to use the service, aside from premiums and co-pays set by their providers.
 
Individual patients who don’t want to tap their insurance providers can choose from three packages: Basic, Premium and Unlimited. Basic, which doesn’t come with an annual fee, requires users to pay a la carte for labs, visits and other services. (For instance, an in-home X-ray costs $150). Premium and Unlimited come with respective annual fees of $99 and $599; costs for visits and services are reduced or waived altogether. (Corporate prices are customized based on the client’s employee count and other factors.)
 
Retrace’s simple pricing scheme is a breath of fresh air in a healthcare sector that famous for confusing statements and wildly variable prices. “We’re huge believers in price transparency and simplicity,” says Aderinkomi. “Customers have a right to know upfront how much they’re paying for their care.”
 
And not everyone is bound by Retrace’s standard prices. The company’s “original 40” patients got a sweetheart deal in exchange for their faith in the company: An all-inclusive lifetime membership for a one-time fee of $300. That deal, unfortunately, is off the table, replaced by a limited-time promotion that waives all visit and lab fees for 12 months with the payment of an annual membership fee.
 

Little, one of Minneapolis’s oldest and best-known design and branding firms, has emerged stronger and more focused from a recession that left some local peers reeling and put others out of business altogether. Since the beginning of 2014, the company has signed a dozen new clients — including high-profile organizations like US Bank and the Minnesota Timberwolves. Collectively, the new accounts will add about $2 million to the company’s top line — a hefty boost for a firm with revenues of about $10 million last year.
 
Little is also refreshing its leadership ranks. Monica Little, the firm’s founder and principal, stepped aside last year. Into her shoes stepped competent leaders like president/chief creative officer Joe Cecere, vice president of finance and administration Kirk Grandstrand, and director of marketing and business development Traci Elder. Cecere is a Little veteran, but Grandstrand and Elder are outsiders to Little and the agency world writ large: Little hired both away from Best Buy.
 
The leadership change, says Cecere, brought a rare opportunity to reassess Little’s priorities and refine the company’s approach in a competitive, rapidly changing industry that’s sensitive to economic disruption. Little has historically focused on high-quality, brand-focused design; in the 1980s, the company cut its chops producing colorful annual reports for MSP-based corporate behemoths like Hudson-Dayton (later Target) and Polaris. But the past decade’s economic turmoil and technological changes drove home the need for a broader, bottom-up approach to branding.
 
“At our core, we still believe in the power of design,” says Cecere, “but we’re a much more holistic brand agency now than even five years ago.”
 
Brand strategy and effective communications, both internal and external, are now critical components of Little’s work. “We want our clients to know what they stand for,” says Cecere, “and to be able to effectively communicate that to employees and customers.”
 
Cecere cites the Minnesota Timberwolves as a prime example. Little is currently helping the Wolves through an “inside out rebranding,” asking employees at every level of the organization for insight into its identity and purpose. The eventual goal: a recognizable, unified brand that produces a compelling, consistent fan experience “that feels right from the moment [fans] enter the arena to the moment they leave,” says Cecere. “As an organization’s most important brand stewards, employees are integral to a positive customer experience.”
 
A broad-based, recession-related drop in marketing budgets and promotional spending complicated Little’s “reset,” though the company survived the downturn relatively unscathed.
 
“Companies typically cut ad spending after they’ve reduced costs elsewhere,” says Cecere, “but we were fortunate not to lose any clients during the recession, just individual projects.”
 
In some ways, the recent economic downturn was a boon for Little, despite the temporary hit to revenues. Lean times tend to disrupt “comfortable” sectors; well-run companies and organizations typically respond by refocusing and rebranding. For instance, Carleton College and the University of St. Thomas Law School, both recent additions to Little’s portfolio, are trying to remain competitive and relevant in an increasingly cluttered higher-education market.
 
“[These schools are] competing against larger institutions with inherent structural advantages,” says Cecere. “For organizations in such a position, the importance of effective branding and communication is clear.” Especially in a world where disruption is the new norm, and companies large and small struggle to stand out from the crowd.
 

Humdinger and Sons, a young ad agency in Minneapolis’ Mill District, may have found the formula for startup success in a competitive industry dominated by entrenched behemoths: seek out, and partner with, other ambitious startups.
 
With a full-time staff of six and a trusted supporting cast of freelance scriptwriters, developers and designers, Humdinger has built and scaled a business around memorable, well-produced promotional videos.
 
Thanks to a rapidly rising profile and impressive client retention rate, Humdinger is growing faster than at any point in its two-year history. At least two new hires, including for business development, are imminent.
 
“We’re taking the expertise we’ve developed over the years in the ad business and reinventing a business model that really hasn’t changed in 40 years,” says Nicolas Will, who co-founded the company along with fellow Minneapolis native Andrew Berg. “Our clients are immensely receptive — we haven’t lost a single one since we’ve been in business.”
 
Will and Berg tie Humdinger’s retention figures to the company’s unique niche and approach. Unlike traditional agencies, which typically compete for high-profile clients like Target and Wells Fargo, Humdinger seeks out ambitious but often cash-strapped startups — in MSP, coastal innovation centers and even international markets — that simultaneously need funding and exposure. In many cases, Humdinger clients can’t even afford an in-house marketing employee.
 
“For a lot of our clients, we’re basically operating as an external marketing department,” says Berg. “Once they see what we can do [after the first project], they totally trust us to handle their promotional needs.”
 
Humdinger’s startup culture appeals to entrepreneurs and innovators, too. Startup owners are used to devising and implementing solutions quickly, without filtering decisions through multiple layers of red tape or aligning directives with corporate protocols. For people used to results, says Will, working with a traditional agency can be a frustrating experience. With Humdinger, there are few if any barriers between agency and client.
 
And for Will, Berg and the rest of the Humdinger team, working with smaller firms ensures that creative work doesn’t get diluted or shelved by an in-house marketing department or hands-on C-suite employees, as sometimes happens with larger corporate clients.
 
There’s an additional benefit to Humdinger’s niche: a relative lack of competition. Will and Berg struggle to identify their closest competitors, largely because established agencies — even small ones — tend to pass on unproven startups that may still be scrounging for funding.
 
While Will estimates that 80 percent of Humdinger’s business is paid upfront, the company will often exchange its services for a percentage of a client’s Kickstarter funding, or even (though less frequently) for an equity stake. Some of Humdinger’s most promising clients” have accepted Humdinger’s services in exchange for equity or a “Kickstarter kickback.”
 
Accepting equity or a percentage of a crowdfunding round — which isn’t guaranteed to succeed — “is a bit of a risk,” says Berg. But for truly promising startups, it’s an acceptable risk.
 
Will and Berg weren’t always risk-takers. Both cut their chops at big coastal ad agencies with high-profile clients — Will was part of a team that designed LeBron James’ first website, after the NBA superstar signed a massive deal with Nike. But in the early 2010s, Will and Berg returned to their native MSP, ostensibly to settle down. The pair first crossed paths at Olson, where they worked for a few months on the company’s Tivo account.
 
Though Will and Berg enjoyed working at Olson, they soon grew frustrated by the sheer volume of inquiries they and their colleagues received from smaller companies and startups without the six- or seven-figure budgets necessary to support a full-scale campaign with a major agency — the types of companies that would later become Humdinger’s bread and butter. So Will and Berg conceived the “Humdinger model.”
 
Current Humdinger Job Listings in Minneapolis
 

1. Business Development Manager
2. PR Specialist

 
A successful Kickstarter that netted Great Lakes Clothing Company more than $20,000 will allow the custom clothing company to move into a new collaborative work space on March 1. The company will share space near the North Minneapolis riverfront with several other Minnesota companies—including Marked Leather, Mill City Fineries, and the U.S.-made artisanal clothing and product distributor William Rogue & Co.
 
“We’re committed to the idea of native businesses sticking together, sharing resources and space,” says cofounder Spencer Barrett, hinting at the prospect of future apparel and branding partnerships with Great Lakes’ co-tenants. The move will roughly quadruple Great Lakes’ floor space, from 600 to about 2,400 square feet,
 
For now, cofounders Barrett and David Burke plan to use the expanded space to grow their inventory and make way for new hires to manage inventory, sales and the company’s expanding online presence.
 
Great Lakes has already shipped its branded T-shirts, crew sweaters, polos and accessories — including koozies — to 47 states, building buzz largely through word of mouth, a no-frills video marketing campaign orchestrated by Barrett, and a “brand ambassador” program that recruits college students to sport its clothing on campuses across the Midwest.
 
Customer service doesn’t hurt either. The co-founders include a handwritten thank-you note with every online order and send a follow-up email about a week after each customer’s order arrives.
 
According to the co-founders, Great Lakes’ brand centers around “life at the lake,” a laid-back, nostalgic vibe that’s instantly recognizable to anyone who has spent a warm day near a body of water in Minnesota. The brand’s mascot is an understated loon, a Northern archetype that needs no introduction.
 
“We found a huge gap in the apparel market,” explains Burke. “No one in Minnesota, or anywhere in the Midwest for that matter, was taking advantage of our unique Northern lifestyle and fusing those ideals into a brand. We strive to create fun, useful and well-made products inspired by life at the lake.”
 
“We were inspired by shared memories of time spent around the water” in the Twin Cities and up north, adds Barrett. “It’s a common experience shared not just by people in Minneapolis-St. Paul and Minnesota, but by anyone who lives near fresh water.”
 
Another Great Lakes differentiator: Unlike many of their competitors, including similarly sized startups, Burke and Barrett are committed to a totally American-made supply chain. The pair will oversee all design work at their new Minneapolis studio, even as the company grows.
 
Great Lakes currently relies on a North Carolina manufacturer to supply the bulk of their unfinished shirts — “that’s where most of the American textile industry operates these days,” explains Barrett — with partners in the Twin Cities handling embroidering, printing and other final touches.
 
Though the online sales model is working well for now, Burke and Barrett are hoping to diversify in the months ahead. A last-minute decision to put on a popup store during the holiday season paid off big time, “blowing past our already pretty ambitious projections for November,” says Burke.
 
The co-founders are already exploring additional popup opportunities at outdoor events — including a “winter golf” tournament on Lake Minnetonka in mid-February — and, possibly, local brewery taprooms.
 
But “the dream,” says Burke, “is a flagship store that gets right to the core of the Great Lakes brand,” with an expansive retail area up front and a fulfillment center in the back.
 
“The popup experience has really reinforced the importance of personal connections for us,” says Burke, noting that in-store conversion rates are about five times higher than online. “We want to be as friendly and hospitable to the customer as we can.”
 

The calendar still says winter, but Tangletown Gardens is ramping up hiring, and investing in initiatives to make the popular South Minneapolis business “even better at what we grow, what we produce, and what we create for our customers and the communities we serve,” says co-founder and principal Scott Endres.
 
That doesn’t mean, however, that Endres and co-owner Dean Engelmann will tear up a playbook that has worked for more than a decade.
 
“The growth of our business has always been organic,” Endres says. “We make sure things as are as good as they can be before taking the next step. Right now, we feel there is room to grow and refine all aspects of our business without having to take on new ventures.”
 
Tangletown Gardens’ current ventures keep Endres, Engelmann and their staffers plenty busy. The flagship garden center at 54th & Nicollet supports a flourishing garden design and consulting business that counts some of the Twin Cities’ most notable companies, nonprofits, government organizations and individuals as clients. Off the top of his head, Endres lists the Museum of Russian Art, the Minneapolis Park Board, the Minnesota Landscape Arboretum and the U of M’s Horticulture Department as “garden partners.”
 
Endres and Engelmann met while enrolled in the University of Minnesota’s horticulture program. They worked in the landscape design business before setting out as partners and founding Tangletown. Careful product selection and innovative cultivation strategies play a role in their success, along with their backgrounds. According to Endres, Tangletown has “thousands of...perennial, annual and vegetable varieties,” along with “the most diverse group of unusual and hard-to-find woody plants in the Upper Midwest.”
 
In addition to the garden center, Endres and Engelmann run Wise Acre Eatery, a bastion of the Twin Cities’ farm-to-fork movement, and a 100-acre farm in Plato, which supplies Wise Acre and a flourishing CSA. According to Wise Acre’s website, “80 to 90 percent of what we serve is grown sustainably” on the Plato farm.
 
Since opening in 2012, Wise Acre has been joined by a host of farm-centric restaurants across town. But it remains unique. “Unlike the owners of any other restaurant we know of, we are the folks sowing the seeds, nurturing plants, and tending the animals in the morning, then delivering the harvest to our restaurant’s kitchen in the afternoon,” says Endres.
 
Endres and Engelmann grow produce year-round in state-of-the-art greenhouses to maintain their locally grown supply. The owners also keep Scottish Highland cattle, two heritage pork breeds and free-range poultry on the farm — a self-contained food ecosystem that relies on “biology, not toxic chemicals,” says Endres.
 
“Healthy soil creates healthy food and gardens, which ultimately create healthy people,” adds Engelmann.
 
This philosophy reflects Endres’ and Engelmann’s upbringing. Though horticulturalists by training, both grew up on small working farms in the family for generations. “Our fathers, grandfathers, and great-grandfathers knew the way they treated their land would shape its future,” says Endres. “We farm today in much the same way as the farms we grew up on.”
 
Current Tangletown Job Listings in Minneapolis
 

1. Garden Designer
2. Container Designer
3. Gardener
4. Seasonal Garden Center Associate
5. Seasonal Landscape Team Member

 

Two new initiatives, MNvest and MN-SBIR (Small Business Innovation Research), are aiming to give Minneapolis-St. Paul startups and entrepreneurs a competitive leg up. Both initiatives lessen or remove existing barriers to funding for early-stage companies.
 
MNvest is a legislative proposal that could pave the way for “equity crowdfunding,” which would remove some red tape from existing securities law and allow young companies to raise up to $5 million from members of the public in any 12-month period.
 
Currently, Minnesota startups can raise funds in three ways, none of them ideal. First, they can register with state and federal securities regulators, a costly and stringent process that’s unrealistic for capital-starved entrepreneurs. Second, they can limit advertised investment offerings to accredited investors — roughly the state’s wealthiest one percent.
 
Third and most common: They can make a private, unadvertised offering, sometimes known as a “friends and family round,” but can’t solicit on the Internet or through other public means. In all cases, startups must either shoulder unreasonable costs or remain unable to accept investments from most members of the public.
 
MNvest’s value proposition appeals to lawmakers and constituents alike, says Winthrop & Weinstine attorney and MNvest proponent Ryan Schildkraut. “The question is simple: Why should only the wealthiest people be able to use the Internet to invest in businesses with compelling ideas?”
 
MN-SBIR is a conduit to the federal SBIR program, which offers access to more than $2 billion in business grants from nearly a dozen federal agencies. Individual grants range from less than $150,000 for Phase I (early stage) companies to as much as $4 million for Phase III (established, generally medium-sized) companies.
 
MN-SBIR provides technical support, proposal writing assistance, cost analyses, commercialization planning and other services for startups and small-to-medium-sized businesses seeking grant money. The Minnesota program also offers regular workshops, including a February 24 proposal-writing workshop and a March 26 overview workshop, for participants and interested parties.
 
MN-SBIR is “often the only source of capital available” to startups and small companies perceived as high-risk by traditional lenders, including venture capitalists, says MN-SBIR director Pat Dillon.
 
The program also pumps federal dollars into Minnesota’s economy. “We send so much of our [tax] money to Washington,” says Dillon. “This is one way for us to get some of it back.”
 
But both MN-SBIR and MNvest face challenges.
 
As a legislative proposal, MNvest is currently working its way through committees at the Capitol. Though the bill has bipartisan support and “has not run into major opposition from any group,” the legislative process offers no guarantees, says Zachary Robins, Schildkraut’s Winthrop colleague and fellow MNvest proponent. House and Senate versions of the bill still need to be reconciled into a single draft, a process that can take time. A full vote could happen anytime between now and late spring, with the governor’s signature required for MNvest to become law.
 
“We’re cautiously optimistic about MNvest’s prospects,” says Robins.
 
MN-SBIR faces a different set of obstacles. The state government recently restarted the program after a decade-long hiatus. MN-SBIR remains under-resourced due to its newness and funding realities, with Dillon and a small team of consultants sharing responsibilities.
 
“I’m a hard worker, but I’m not Superwoman,” Dillon laughs.
 
The continued economic vitality of Minneapolis-St. Paul, and Minnesota more broadly, could hinge on the success of MNvest and MN-SBIR. Both find the state in the unfamiliar position of playing catch-up with others, including some of its closest neighbors.
 
MNvest, for instance, is similar to bills already passed in Wisconsin, Indiana and other midwestern states. Last year, Schildkraut found out about Craftfund, a Milwaukee-based brewery crowdfunding platform that takes advantage of the Wisconsin law.
 
“I assumed we had something similar on the books in Minnesota,” he recalls. When subsequent research failed to turn up anything similar, he and Robins set MNvest in motion.
 
“We’re just young and energetic enough to try to get a law passed,” says Schildkraut.
 
Meanwhile, MN-SBIR aims to dramatically increase Minnesota’s share of the federal SBIR pie. Local companies account for just $30 million of the $2.3 billion total, a disproportionately small share relative to population. California and Massachusetts alone account for nearly 50 percent of the available amount.
 
“We could do a whole lot better given our size and existing entrepreneurial energy,” says Dillon.
 

A novel partnership between several local craft breweries and the students in a College of Design class at the University of Minnesota produced innovative tap-handle designs, and laid the groundwork for future collaborations between creative students and the Twin Cities’ booming beer industry. Sarah Sheber, a fabric developer at Target, taught the Product Form and Model Making class. Her intention was to give students a window into the workings of the small, creative businesses reshaping the Twin Cities’ economy.
 
“I pursued smaller [breweries] purposefully,” she says. “I wanted students to have a chance to learn as much about [the breweries’] brands as they could, to see as much of the business as possible and understand the different roles that go into producing local brews. With a large company [like Target], individuals own a small piece of the process. With small companies, each member of the team needs to be flexible, to know the business and the brand, and be able to wear a lot of hats.” 
 
Fair State Brewing Cooperative in Northeast Minneapolis participated in the project. So did Mighty Axe Hops, which produces high-quality, locally grown hops for brewers in Minneapolis, St. Paul and elsewhere; and Excelsior Brewing, a suburban taproom and brewery.
 
Students produced multiple tap-handle designs for each business, some attempting improvements on existing designs and others completely reimagining the brands’ ethos. Breweries had the option to purchase finalized tap handles, which otherwise remain student property.
 
The collaboration had two overarching goals. First, Sheber wanted to students to experience the creative freedom and creative expression that inform commercial design projects. “The idea was to act like a client, providing support and feedback as students worked through each design,” says Matt Hauck, Fair State’s director of operations.
 
Not every design was practical. One student incorporated powerful rare earth magnets into a prototype, recalls Fair State CEO Evan Sallee, making it impossible to detach and move. “There was a lot of trial and error,” says Sallee, “but it was great to be engaged with talented students who are passionate about design.”
 
Some designs eventually solved problems of which Hauck and Sallee weren’t even aware. “The students we worked with put a lot of thought into the ergonomics of their final designs, something we’d never even considered,” says Sallee.
 
Sheber and her students unveiled the final tap-handle designs during a December 16 happy hour fueled, naturally, by free beer from Fair State and Excelsior. Sheber is already planning to bring back the collaboration for next year’s class, possibly with new brewery partners.
 
“We’ve had interest from brewers of all scales,” says Sheber, some of whom urgently need updated branding.
 
At Fair State, Sallee and Hauck may take a pass on using any of last semester’s designs. But they’re open to future collaborations that keep their branding fresh and distinctive.
 
The local craft beer community is largely chummy and supportive of new entrants, says Sallee. “But positioning among other breweries’ tap handles at bars is still important,” he notes. “You want your design to stand out in the right way.”
 

Urban Growler is booming. And co-founders Deb Loch and Jill Pavlak have a lot on their plate, from a long-awaited kitchen and menu expansion to a new Kickstarter campaign and a rapidly growing distribution footprint. The St. Anthony Park brewery now has 22 employees, with 17 between the brewery and taproom, and 5 in the kitchen. That’s up from about a dozen when the brewery first opened.
 
“We thought we could get by with 12 or 13 people,” says Pavlak, but Urban Growler’s runaway popularity quickly spurred another hiring round. “You need to have enough [employees] to provide excellent customer service,” she says. “That’s what keeps people coming back.”
 
The kitchen expansion tops on the agenda. Pavlak hopes to have the kitchen expanded by mid-winter, but warns of unexpected delays or complications.
 
“If there’s one thing I’ve learned since we began,” she laughs, “it’s that timetables can slip.” She and Loch had to push back Urban Growler’s opening date several times due to unforeseen complications.
 
The new kitchen’s menu will expand to include burgers and other entrees made from organic, locally sourced meats. Urban Growler cultivates relationships with local producers whenever possible, says Pavlak, noting a particularly poetic relationship with Mark and Jesse Gilbertson, a pair of western Wisconsin farmers who frequent the St. Paul Farmers’ Market. Pavlak hands off Urban Growler’s spent grains to the Gilbertsons to be used as animal feed
 
“They tell us their cows, hogs and chickens love them,” says Pavlak. “The grains are sweet, but also wholesome and protein-rich.”
 
Once the new menu is in place, Pavlak and Loch plan to buy beef, and possibly pork and chicken, from the Gilbertsons, creating a sustainable circle. Pavlak says the new kitchen may also use spent grains in house-made bread and cookies, though “we’re still working on the recipes,” she warns.
 
Pavlak says the new kitchen’s Kickstarter campaign should be live before Christmas, but details on the funding amount and timeline still have to be worked out.
 
Separately, Urban Growler is also feverishly producing more beer to satisfy an expanding roster of brewery and restaurant clients, despite frustrating delays in fulfillment for Urban Growler’s branded tap handles. “We’re still sending out prototype tap handles,” laughs Pavlak.
 
Distributed beers include Cowbell Cream Ale, City Day Ale and Graffiti IPA. Most confirmed accounts are in the western suburbs, but Pavlak mentions Bar Louie in Uptown and Muffuletta in St. Anthony Park as local adopters. In October, a Muffuletta-Urban Growler beer dinner sold out in seven hours. “[Muffuletta’s manager] said that was a record,” says Pavlak.
 
Beyond the kitchen, Urban Growler’s interior configuration is changing for the better. Come January 1, the co-founders will take over a storage area next door that will house a gigantic cooler that now juts out into the seating area. The expanded kitchen will occupy part of its former footprint, with expanded seating and standing room in the remainder.
 
And Pavlak and Loch are weatherproofing the brewery, widely known for its spacious, sunny patio. An interior vestibule, installed in November, should shield the high-ceilinged brewhouse/taproom from outdoor cold.
 

Drivers can now reserve and pay for parking spots in advance at most major sports and event venues in the Twin Cities, including the XCel Energy Center, Target Center, Target Field and the Hennepin Theater Trust, thanks to Baltimore-based Parking Panda. The parking-logistics company entered the Twin Cities market within the past 12 months and has already amassed more than two-dozen clients.
 
That initial response vastly exceeded Parking Panda’s expectations. Target Center saw more than 3,500 reservations for a single concert, says Parking Panda marketing director Bryan Lozano, just days after the company went online there.
 
“The Twin Cities has quickly become one of our best markets,” says Lozano. “We’re providing a service that really wasn’t available before and tapping into the region’s dynamic urbanism,” he adds. Parking Panda, he continues, is one more solution in a transportation mix that includes a world-class bike infrastructure. and multiple bus and train lines running connecting the two cities.
 
Lozano ascribes Parking Panda’s rapid adoption to its “great partners.” The company works directly with teams, like the Minnesota Wild and Twins, to promote its parking services and encourage fans to reserve space ahead of time. That reduces congestion before and after games.
 
“One of the biggest drivers of traffic and congestion is people driving around looking for parking,” says Lozano.
 
In addition to major sports and entertainment venues, the company also contracts with garages near West Bank academic buildings, the Minneapolis Convention Center and in the heart of Uptown’s business district. All are big draws for out-of-towners likely to be impressed by the Twin Cities’ smooth parking and transit infrastructure.
 
Parking Panda lets garage and lot operators set prices for individual parking spaces on the Parking Panda site. Drivers can search for spaces near their destination, selecting the cheapest or most affordable ones, and then reserve and pay in advance. Parking Panda takes 20 percent of each transaction and forwards the remaining 80 percent to operators.
 
Though it doesn’t yet do so in the Twin Cities, Parking Panda also lets homeowners and small business owners rent out extra spaces in small lots, driveways or alley, creating new income streams for individuals.
 
Parking Panda doesn’t have a local office, though a single sales rep does support operations in the Twin Cities. The company is exploring opportunities to organize parking for major events like the Minnesota State Fair—which could involve working with hundreds of property owners in Midway and the North Side of St. Paul. That may require a more robust local infrastructure and could create more opportunities for frustrated Twin Cities’ drivers.
 
“Parking can be a painful experience,” says Lozano. “Parking Panda works every day to take the pain out of parking.”
 
 

Twin Cities’ parents have a new source for unique, high-quality baby apparel and nursery decorations: BoomBoom Prints, an online marketplace based out of an “informal coworking space” in downtown Minneapolis. BoomBoom Prints (BBP), says Jennifer Weismann, BBP’s PR consultant, is “Etsy meets Pottery Barn.”
 
Fresh off a July 2014 launch, BBP already has 4,000 unique pieces for sale and about 500 participating designers—many of them based in the Twin Cities. The company has four full-time employees and three part-timers, says CEO Brett Brohl, with tentative plans to add more after the holidays.
 
A recently closed fundraising effort earned $400,000, a tidy sum for a startup. “Our funding round allowed us to make key hires, invest in our platform and expand our offerings,” says Brohl. BBP started as a marketplace for wall art, he explains, but now offers clothing, stationery and baby/parent accessories as well.
 
Founded by new dad Ryan Broshar and “serial entrepreneur” Brohl, BBP sources designs from a rapidly growing community of artists—including many in Minneapolis-St. Paul.
 
“I heard about the site from a friend of a friend,” says Twin Cities’ artist Kate Worum, who chose BBP as her first online sales channel. “BoomBoom Prints felt more approachable: They are local, have the artists’ interests in mind and they advertise by word of mouth.”
 
Worum is not alone. Another local BBP artist, John Gerber, has created such items as a bib captioned “Feed me” and a onesie that asks “Who you calling baby? Thought so.” Kate McCollow’s wall art features baby-themed fantasy scenes and serene watercolors depicting familiar Twin Cities’ landscapes.
 
BBP artists set their own prices, using the company’s suggested multipliers to arrive at a fair retail price. BBP then takes a cut of the sale and passes the rest on to the designer.
 
Though the Etsy comparisons are inevitable, Brohl points out a key difference: BBP is completely turnkey, handling every nitty-gritty aspect of selling artwork online, from printing and shipping to returns and customer contact. Etsy and other online marketplaces ask artists to do these tasks.
 
Worum appreciates BBP’s full-service approach. “I run a freelance illustration and design business by night, and work as a trend forecaster for apparel and accessories at Target during the day,” she says. Her hectic schedule makes it impossible to fulfill orders herself or even print her own work. “With BoomBoom Prints, all I have to do is make my art, click a few buttons and move on with my day.”
 
There may soon be more local “BoomBoomers” like Worum. Though about 50 percent of BBP’s designers are international, says Brohl, “we’re really concentrating our efforts on developing artists in our backyard. There’s so much artistic talent and diversity here.”
 
Brohl and his team often reach out directly to local artists and invite them to sell their work on BBP. With no upfront costs, they’ve already found lots of takers. “We’re excited about the future,” says Brohl. “We’re making a go of it.”
 

Outsell, based on the 32nd floor of the Capella Tower in downtown Minneapolis, is one of the fastest-growing companies in the U.S. according to Inc. Since 2010, Outsell has roughly tripled its employee base and quadrupled its revenue. The company earned a spot (#455) on the 2014 Deloitte Fast 500, a closely watched list that tracks revenue growth at public and private North American companies. According to Deloitte, Outsell is Minnesota’s third-fastest growing tech company.
 
And Outsell shows not signs of slowing down. The company has added 15 jobs this year, bringing its total headcount to more than 100, and predicts an equal or greater number of employees for 2015.
 
“Our people are our most important asset by far,” says founder and CEO Mike Wethington. “We’re constantly looking for talented, self-starting candidates, especially web developers, data analysts and marketing specialists.”
 
Outsell’s current office space measures about 18,000 square feet, with a variety of spaces that encourage collaboration. Depending on the pace of hiring next year and beyond, says Wethington, his company may soon need to exercise an option to expand into the Capella Tower’s 31st floor.
 
Outsell was started in 2004, when Wethington, a self-described “serial entrepreneur,” bought Judson Bemis’s Solv Technology, which had developed an online lead generation solution for auto dealers. Wethington and his first employees improved and streamlined the platform, developing analytics to predict customer preferences and deliver automated, high-value marketing material.
 
For instance, a recent car buyer might receive emails or texts advertising oil changes, tune-ups and vehicle-appropriate accessories consistent with the buyer’s past purchasing and web navigating habits. “We customize and automate everything for the dealers so they can devote more resources to selling and fixing cars,” says Wethington.
 
“The experience is brand-consistent, like Amazon,” he explains, allowing independently owned and franchised dealers to use the same platform and analytics as others selling the same model. Outsell currently works with about 1,000 U.S. dealers and seven automotive brands, sending out automated communications to about 10 million consumers per month.

If you’ve recently purchased a new or used vehicle from a franchised dealer, there’s a good chance Outsell is behind the marketing emails and texts it sends you.
 
Despite its reach, there’s room for Outsell to grow. Dealers spend well over $1 billion per year on marketing, says Wethington, and many don’t yet use automated customer-contact solutions.
 
Even as Outsell racks up impressive growth figures and finds new ways to improve the customer experience, the company devotes significant resources to employee retention. The company offers unlimited paid time off, with no questions asked, and no distinction between sick days and vacation time, a rarity in the modern workplace.
 
“We place a lot of trust in our employees,” Wethington explains. “We expect them to take care of their work and reward them for holding up their end of the bargain,” –i.e., getting their work done on time.
 
Outsell also offers a profit sharing program for all associates, including entry-level employees, as well as performance bonuses, a matching 401(k) and tuition reimbursements for associates looking to further their careers with advanced degrees.
 
In a typical year, says Wethington, Outsell devotes 3 to 5 percent of total operating income to charitable contributions. The company’s employee-led Caring Committee partners with the Minnesota Keystone Program to distribute financial resources and manpower to groups like the Make-a-Wish Foundation, Boys & Girls Clubs of America, and the ASPCA.
 
Giving back to the local community is a win-win experience for employees, says Wethington—just like every workday at Outsell. The company’s perks earned it a spot on a recent Star Tribune list of best Minnesota work environments.
 
“We love being based in the Twin Cities,” he says. “We’ve got a talented, smart, kind workforce that understands the value of hard work and doing the right thing.”
 
Outsell Jobs in Minneapolis
 
Senior Software Analyst

Senior Software Developers