emerging technology : Innovation + Job News

Since 1990, the Americans with Disabilities Act (ADA) has ensured equal opportunity for Americans who suffer from physical and mental conditions that limit their means. While wheelchair ramps, closed captioning and wider doorways have become commonplace, the digital realm still lags behind.

Accessible360, founded by entrepreneur Mark Lacek, seeks to fix that oversight. The company’s purpose is to make websites and digital apps fully functional for those impaired by blindness, deafness, or physical or cognitive restrictions. The company was launched this April and began promotion last month, just in time to help businesses comply with a rollout of new regulations from the Department of Justice in 2018.

Technology has changed since 1990 when the ADA was passed, and the Department of Justice announced last year that it the law applies both to physical buildings as well as digital areas. Accessible360 is here to make companies accessible today.
Many screen readers don’t recognize 100 percent of a website, Lacek says. When a blind user can’t access an offer, it’s discrimination and a violation of the law. Some compliance issues are obvious, like font sizes that affect the visually impaired but, he says, most are subtle. “There are things you would never recognize as a sighted person. Technology just doesn’t pick them up.”

Checkout screens are a notorious problem for blind users, he explains, which alienates disabled users and decreases potential sales. Studies show that disabled Americans spend more time online than their non-disabled counterparts, so it’s essential for companies to adapt to their needs. “Up to 85 percent of websites are not compliant based on what the current ADA guidelines are,” says Lacek.

“It’s somewhat Y2Kish,” says Lacek, explaining digital ADA compliance. “There’s this pending thing on the horizon. The difference is everyone knew about Y2K and people are just becoming aware of this issue.”

Accessible360 offers three core services. Lacek’s team of 10— led by accessibility engineer Aaron Cannon (who is blind)—will provide an audit of a website to determine issues and potential fixes for a client. Other services are remediation (fixing the issues) and monitoring. Monitoring, he explains, works like a home security system or credit card alert program, where Accessible360 makes sure that any new content uploaded to a website remains in compliance even after the first two phases are complete.

“The biggest challenge is really awareness and education of the general public,” says Lacek. “A lot of people don’t realize that the ADA regulations applies to the internet and their sites need to be accessible.” The company was inspired by the number of lawsuits being filed about website accessibility.

So far, Lacek’s team has worked with retail, financial services, travel, health and medical, and educational websites. It’s important to be compliant, he says, but it’s more important to make the world a better place.

“No one wants to be that company or that website that’s not empathetic to all of society,” he adds, “including the disabled.”
 

Player’s Health, a sports medicine startup based out of COCO’s Northeast Minneapolis hub, has made quite a name for itself in the short time it’s been in Minnesota. Last week, the company earned top prize at Google Demo Day, arguably the United States’ most visible startup pitch competition. Though the award itself doesn’t have a monetary component, more than 100 Silicon Valley financiers attend Demo Day each year, and the event is widely regarded as one of the world’s best places to raise startup capital.
 
Case in point: according to the Star Tribune, more than 100 Silicon Valley-based investment firms listened to this year’s 11 pitches.
 
Though Player’s Health hasn’t raised any funding off the award yet, there’s plenty of opportunity in the weeks ahead. AOL founder and former CEO Steve Case has pledged to personally give $100,000 to any finalist that raises $1 million within 100 days of Demo Day. Player’s Health has a head start: It’s currently in the midst of its first major fundraising push, slated to continue through the spring.
 
Founded by Chicago native and former pro football player Tyrre Burks, Player’s Health uses data to make youth sports safer for kids, less worrisome for parents, and less logistically challenging for coaches and school systems. The company’s signature solution is a HIPAA-compliant platform that builds and stores complete player profiles for youth sports participants.
 
These profiles contain a stunning breadth of information: not just personal health data, but also the type of field each kid plays on, the type of equipment used, where injuries occur and more. Over the long term, Burks hopes to tap an ever-growing body of injury data to produce targeted insights about where, how and why injuries occur. School systems and non-academic sports leagues can then use those insights to mitigate injury risk and ensure injured athletes recover properly.
 
“We manage not just injury, but record proper diagnosis and when patients can come back,” Burks told the Star Tribune. He saw his promising football career cut short by injury. “We need an app that collects this info to better understand the environment and how to make it safer.”
 
Player’s Health’s platform won’t be fully operational until June, when it begins tracking player injuries as they occur. But that hasn’t stopped Player’s Health from lining up a host of clients from Minnesota and surrounding states — including Minneapolis’ Homegrown Lacrosse, a youth lacrosse league.
 

If you’re a regular on the yoga circuit, you know that most studios’ climate-control settings pay little or no mind to accepted indoor heating and cooling conventions. When you walk into your morning vinyasa class, you’re primed to expect a fetid sauna, frost-lined meat locker or something in between—or maybe, as your session progresses, all of the above.
 
Good news, perennially uncomfortable yogis. With help from 75F, an ambitious Minnesota startup that makes responsive, Internet-connected climate control solutions, two Minneapolis YogaFit studios are bringing predictability (and comfort!) back to the yoga routine.
 
The studios, in Northeast and Linden Hills, tapped 75F to remedy years of HVAC frustration. Each studio operates 24/7, with a mix of class and open studio time, and attendance varies widely from hour to hour. During cold-season peak periods, attendees’ body heat is often sufficient to heat each studio with little to no assistance from the HVAC system. When attendance is sparse, passive heating can’t keep things comfortable. The inverse (or nearly so) is true during the warm season: heavily attended sessions require nonstop AC on full blast, while unoccupied studios require little to no climate control.
 
Needless to say, the studios’ multiple non-programmable digital thermostats simply couldn’t manage this constantly shifting demand. According to a 75F case study, studio temperatures ranged anywhere from 73 to 90 degrees on a typical day. Instructors would arrive 30 to 45 minutes early to set the proper temperature for each class, and had zero control over the studios’ temperature during unoccupied periods.
 
75F’s solution was seamless and elegant: unlike typical programmable thermostats, its multi-zone thermostats integrated directly with the studios’ scheduling software, empowering instructors to set comfortable class and open studio temperatures days in advance. And the system’s detailed analytics enabled management to track temperature changes (and anomalies) in near real time. The result: more comfortable studio environments, and more relaxed instructors, around the clock.
 
“We needed a partner, and a solution, that could react to our business—not the other way around,” says Ashok Dhariwal, YogaFit’s Minneapolis franchisee. “75F delivered a customized solution based on our business needs, [implemented] it very fas  and has supported us every step of the way.”
 
75F’s smart climate control systems are also suitable for restaurants, retail outlets and offices of virtually any size. According to 75F’s website, the technology reduces customers’ heating and cooling costs by up to 40 percent.
 

Bringing a new medical device to market is a costly, time-consuming process. Innovations that seem like a slam dunk in the research lab often turn out not to work as intended during development. Clinical trials require minute, painstaking attention to detail. Federal regulators, understandably, demand proof that any new device is reasonably safe and works as its manufacturer claims. Each of these steps requires adequate funding and skilled manpower.
 
At the end of it all, Medicare, Medicaid and private insurance firms must be willing to reimburse providers that use the device. With rare exceptions, devices that don’t qualify for reimbursement—a highly complex consideration—fail to find traction in the market.
 
“Even with unlimited funding, it can take two years or more to complete the process for relatively simple medical devices,” says FocusStart founder and CEO Dr. Daniel Sigg.
 
Sigg and FocusStart co-founder Peter DeLange, who previously ran a successful medical device startup called Devicix (recently purchased by Nortech Systems, a local medical engineering company), had each spent years searching for a better early-stage device development model. When they met a few years back, they quickly realized their professional skills complemented each other.
 
So they founded FocusStart, a St. Paul startup that shepherds promising medical technologies through the tricky testing and development phase, refines validated devices for commercialization, and seeks strategic partners (typically multinationals) to complete the regulatory approval process and actually bring devices to market. FocusStart’s model is less capital-intensive than traditional medical device development models, though the company still assumes risk for technologies that don’t pan out during development.
 
FocusStart currently has four promising technologies in its portfolio: a cardiac product that may reduce blood clot risk following certain surgical procedures; a urological catheter that may reduce the risk of certain infections; a “smart” respiratory inhaler; and a “tissue tension sensor” that may promote better outcomes following partial and total knee replacement procedures.
 
Sigg and the team are devoting substantial energy and attention to the tissue tension sensor, which is capable of directly measuring ligament tension without requiring an invasive cut. Direct measurement enables surgeons to properly “balance” the knee during the replacement procedure, reducing the likelihood of complications or outright failure.
 
The sensor could potentially benefit other orthopedic procedures, such as rotator cuff and ACL surgeries, though FocusStart is concentrating on knee replacement for now. According to Sigg, it also has potential as a training tool for newer surgeons, who lack the intuitive “feel” of more experienced operators.
 
Although each technology is different, FocusStart’s development approach is fairly standardized. First, the company approaches a research institution to work out a licensing agreement for the technology. FocusStart works with the University of Minnesota, Mayo Clinic, the University of Zurich (in Switzerland) and an Israeli inventor.
 
“We quickly found that these agreements are fairly standard, with some variation,” says Sigg.
 
FocusStart generally would pay a royalty on future sales of the product, possibly with an equity component to sweeten the deal for the institution should the technology find its way into a marketable device.
 
“We find it easier to develop relationships locally,” says Sigg, adding that his Swiss background (he grew up in Switzerland and attended medical school at the University of Basel) probably helped with the Zurich partnership.
 
FocusStart’s lean model helps, too. “Once [our partners] understood our approach, we become more successful in finding very interesting technologies,” says Sigg. And the combined expertise of the firm’s principals—Sigg was a board-certified anesthesiologist and subsequently amassed almost two decades of medical research and development experience, while DeLange had the business chops to build Devicix into a successful concern and boasts insider knowledge of the medical device field—doesn’t hurt.
 
But that doesn’t mean swift success is assured. FocusStart has been “fortunate” to receive National Institutes of Health grants during the early going, but the company continues to seek government grants and private funding—a process that will likely continue as Sigg and DeLange seek out and develop promising new technologies.
 
There’s no such thing as a perfect batting record in the medical device business. “As we do our own work, we may find challenges or problems that weren’t apparent previously,” says Sigg. “Occasionally, you have to know when to say ‘that’s it’ and walk away [from a technology].”
 

In August, downtown Minneapolis-based healthcare incubator TreeHouse Health teamed up with LifeScience Alley, a local biotech accelerator, for a well-attended demo day called Healthcare Innovation Is Alive and Well in Minnesota. According to Dr. John Blank, a TreeHouse Health cofounder (and, previously, a pediatric oncologist and health system administrator), the event supported TreeHouse’s ambitious-sounding mission: to turn MSP into the “Silicon Valley of medical technology innovation.”
 
Healthcare Innovation is Alive and Well featured lectures and workshops on pressing issues facing early-stage medical technology and life science companies — raising capital, bringing ideas to market, becoming cashflow-positive and more — plus an open, craft brew-fueled networking hour with some of the region’s top healthcare decision-makers.
 
But the real stars of the show were the innovative startups tapped to pitch their solutions to the high-profile crowd. Many were current TreeHouse Health tenants: Cellanyx, whose diagnostic solution could revolutionize the industry’s approach to certain cancers; PerkHealth, a virtual health coaching app that made The Line’s 10 life-changing startups list last year; and VitalSims, an education platform for medical professionals.
 
TreeHouse Health’s portfolio is compelling. But Blank believes that if MSP is to live up to TreeHouse’s “Silicon Valley” promise, more needs to be done to support current and future medical technology entrepreneurs. At the moment, MSP lacks a critical mass of native venture capitalists willing to go out on a limb for potentially disruptive healthcare ideas.
 
Blank cites an early-stage health IT firm, currently in residence at TreeHouse Health, that had struggled to meet a $2 million funding round target with local backers despite a proven technology solution and more than $1 million in annual revenues. After six or seven months of banging on doors in MSP, the firm broadened its search and eventually completed the round with outside investors.
 
“There are plenty of investors interested in the health IT space,” says Blank, a Massachusetts native, “but they’re mostly based on the East or West Coasts and tend to fly over Minnesota.”
 
That’s why Blank and the TreeHouse team are fanatical about boosting the visibility of the companies in and outside of TreeHouse’s portfolio, starting with initiatives like the Life Science Alley collaboration.
 
TreeHouse is also working to attract promising companies that began life in regions better known for tech innovation, like Boston (arguably the capital of the U.S. life sciences industry) and the Bay Area. According to Blank, TreeHouse currently has one tenant from each region, with an eye for more.
 
A key selling point for TreeHouse and MSP in general, he says, is location. “You can easily travel anywhere in the continental United States and back within a 24-hour period, or even in the same business day” from MSP, says Blank. He mentions a TreeHouse tenant that recently flew overnight to Seattle for morning meetings with hospital executives there, then caught an early-afternoon flight back in time for dinner—a nearly 3,000-mile round trip in less than 24 hours.
 
“That kind of turnaround isn’t possible when you’re based on the coasts,” says Blank.
 
Another big advantage for MSP: a diverse array of established medical “payers” (health systems like Mayo and HealthPartners), insurers (like UnitedHealth Group), and device/technology manufacturers (like Medtronic and St. Jude Medical).
 
In other words, local life science and medical technology startups that do manage to find funding here are apt to find lots of paying customers close by, regardless of niche—an important measure of security for any early-stage company. Over the long term, that existing customer base, coupled with a healthy dose of Minnesota nice, should prove enticing for coastal entrepreneurs looking to relocate to a cheaper, business-friendly locale.
 
“[MSP] is one of the few places in the country where you have Fortune 100 companies in every major healthcare sector,” says Blank. “And it’s a friendly enough place that you can make real progress toward building a professional network within a few days.”
 

There’s about to be a new way for amateur and professional musicians to collaborate on original music without regard for geography — and it’s made in MSP.
 
Record Together, an innovative recording and idea-sharing platform developed and promoted by MSP brothers Scott and Mike Bishop, is nearing the launch of a completely revamped application that allows multiple musicians to collaborate on the same song, no matter where they live or whether they have access to sophisticated instruments and recording equipment.
 
Think of Record Together as a virtual, remote music studio that connects musicians who’d otherwise never even hear of each other, let alone meet up for a recording session. Users lay down one or more tracks — anything from an isolated piano line to a four-piece band’s guitar, bass, drum and vocal tracks. They then “draw in” outlines for other tracks (for instance, a vocal harmony to accompany the piano line) using automated music software and publish to Record Together’s online marketplace. Once published, other users record their own tracks to replace the drawn-in outlines and create a whole (or at least more complete) composition.
 
Record Together is intentionally designed for musicians of all ages, abilities and levels of seriousness. “We cater to professional jazz musicians with mindblowing musical skills and years of experience,” says Mike Bishop, “along with high school kids just messing around with a guitar or saxophone in the basement.”
 
The Bishop brothers fleshed out the revamped Record Together platform with non-technical, cost-conscious users in mind. According to Scott Bishop, Record Together isn’t the only cloud-based music recording solution that empowers cross-border collaboration. But musicians would be hard-pressed to find a simpler, more cost-effective option.
 
“Access to a professional recording studio is a major barrier to entry for most musicians,” he says, “due to the high cost of reserving studio space and the limited amount of space available.” Musicians who record demo tapes or digital imprints on their own solve the cost problem, he adds, but sacrifice collaborative potential and sound quality.
 
“Our objective with Record Together is to reduce recording expenses and remove every possible barrier to enjoyment and creativity,” says Mike Bishop. “We want to move users closer to their end goal — making great music.”
 
The updated Record Together app replaces a legacy platform born in 2011. The legacy platform was built around “opportunities” — calls for single-track contributions to unfinished songs. For each opportunity, users submitted recordings that fit the stated requirements; the opportunity’s poster then selected the winner and paid the creator an agreed-upon sum. The new platform is still transactional — “We want users to get something back for their contributions,” says Scott Bishop — but the “draw in” feature allows for a more seamless and expansive collaboration process.
 
Although the Bishops are coy about when the new platform will roll out to the public, they’re not shy about their plans or ambition. The brothers are currently putting out feelers for a seed funding round, says Scott Bishop, in the hopes of scaling the platform and ensuring that “everyone who wants to use it will be able to from day one.”
 
After that, the sky’s the limit. “We believe that Record Together has the potential to do for music what YouTube did for video,” he says.
 

In February 2015, Minneapolis startup Vidku raised $17 million in a 17-day Series A funding round led by Arthur Ventures, a Fargo-based venture capital group. The speed and size of Vidku’s fundraising effort was unusual: According to data from CrunchBase, the average Series A raised $6.9 million in 2014 and it often takes months to close a successful round.
 
So it’s no surprise that MSP’s investors and innovators sat up and took note of Vidku’s breakout success. CEO Jim Leslie attributes his company’s achievement both to the far-reaching capabilities of Flipgrid, its core “asynchronous video sharing” product, and the boundless belief of Vidku’s 35-plus employees.
 
“Our investors weren’t interested because they knew who [Vidku’s leaders] were or trusted us to execute,” says Leslie, a self-described “serial entrepreneur” who ran a handful of successful firms (and sold his most recent venture for a cool $100 million in 2011) before joining the Vidku team. “The passion of our entire team regarding Flipgrid’s future possibilities was infectious — our investors got as excited as we were” about Vidku and Flipgrid.
 
Users believe in Flipgrid, too. According to Leslie, the product has hosted more than 3 million video shares since its January 2014 launch, spreading chiefly through word of mouth. (Vidku has no formal marketing operation to speak of, though that may change in the future.)
 
Flipgrid admins, typically classroom educators, populate “grids” with video or text questions, prompting video responses from student users. Everyone with access to the grid can see and share the responses. There’s no limit to each grid’s capacity for questions and responses, though admins are limited to a specific number of grids per year — typically five to 10, or roughly one per class for full-time educators.
 
Though Flipgrid was originally designed for educators, Leslie is quick to point out that about 20 percent of the platform’s volume is devoted to non-educational use. Private businesses and government agencies use Flipgrid as a collaborative tool, while wedding planners and religious institutions leverage it to create more social events and environments.
 
“Flipgrid is a growing, powerful and highly effective technology tool that’s getting stronger all the time,” says Leslie. Following Vidku’s “design first” imperative, “we’re constantly developing new ways for users to participate.”
 
Vidku’s development activities have accelerated since the company spun out from an eight-person University of Minnesota team led by Dr. Charles Miller. Miller’s team is responsible for designing and building out Flipgrid’s base technology and critical elements. Leslie and co-founder Phil Soran, also a wildly successful tech entrepreneur, caught wind of Miller’s innovation and offered to form a private company capable of turning Flipgrid into a disruptive technological force.
 
“We were only interested in [spinning Flipgrid out of the U and forming Vidku] if [Miller’s] entire team was on board,” says Leslie. He didn’t need to worry: The response was an enthusiastic “yes.”
 
For Flipgrid’s core team and the U itself, the transition to private enterprise has thus far been smooth. All eight team members remain on staff at Vidku, generously compensated for their efforts and diligently working on the next big thing.
 
Perhaps more importantly, the U is a major shareholder in Vidku; Vidku’s success is quite literally the U’s success. Such public-private synergies, wherein universities drive innovation and investors provide the capital necessary to bring transformative ideas to market, are commonplace in established tech centers like Boston and Silicon Valley, says Leslie, but less so in MSP.
 
“A strong public-private linkage is the hallmark of a healthy entrepreneurial community,” he says. “We’re on the cusp of that here” in MSP.
 
In addition to Flipgrid, Vidku also offers a video-based assessment tool called Avenue. “Whereas Flipgrid is suited for discussions” and other forms of knowledge and experience delivery, Leslie explains, “Avenue is ideal for more formally assessing knowledge.”
 
Vidku’s team also handles development work for Passport, a language-learning application initially developed by St. Paul-based EMC Publishing. Though Vidku doesn’t own Passport, Fligrid and Passport are kindred spirits with the same lofty goal: reducing friction and improving knowledge delivery in the classroom.
 
Later this year, Vidku plans to launch an application that offers a “significant enhancement” to Flipgrid’s capabilities, says Leslie. The new update “is the first tangible fruit of our intensive development efforts” since spinning off from the U, he adds, though he’s mum on the software’s specifics.
 

Though debate continues as to whether the average person needs eight glasses of water per day, many of us still forget to stay hydrated when we’re busy. Hidrate co-founder and recent University of Minnesota graduate Nadya Nguyen found out the hard way.
 
On the bus home from a 10-hour volunteer shift at TEDxMinneapolis, Nguyen felt faint and disoriented. Her head was pounding. With effort, she recounted the events of her jam-packed day and realized that she hadn’t taken a single sip of water since the morning. She simply hadn’t had the time, to say nothing of the mental bandwidth necessary, to stop what she was doing and take a drink.
 
Then it hit her: In the age of cloud-connected smartphones and tiny, powerful sensors, she didn’t need to remember to drink water. She could simply build an app that connected to a special water bottle that would remind her to hydrate. Along with three other recent U of M grads, she built out the app and a prototype water bottle—called Hidrate—during least year’s Twin Cities Startup Weekend.
 
“It’s so easy to forget to take care of yourself when life gets busy,” says Nguyen. “I wanted to create something that would make life better for people in this small but important way.”
 
The idea is breathtakingly simple: Users download the app for free on their phones and enter personal parameters (weight and other factors), location (temperature, relative humidity and altitude can affect water needs), and daily activity level, editing over time as this information changes. Hidrate uses this data to create a personal “daily water goal,” expressed in both ounces and water bottle equivalents. The app syncs with a 24-ounce, BPA-free, dishwasher-safe water bottle that can sense its own fill level and updates your total daily intake whenever you take a sip. If you go too long without drinking, a reminder message appears on your phone; if you really fall behind, the bottle glows gently until your fluid intake gets back on pace.
 
Hidrate isn’t the first smart water bottle to hit the market. But the talented, driven team enjoys the benefits of a heavily discounted shared workspace at Startup Venture Loft in the North Loop — a huge help for any startup operating on a shoestring budget.
 
The company’s Kickstarter campaign, launched June 1, had a seemingly ambitious goal: $35,000. Thanks to tremendous support from what Nguyen calls “a dedicated group of early adopters” and a high-visibility mention in widely read tech publication TechCrunch, the campaign blew through that ceiling in a couple days, notching nearly $200,000 from more than 2,500 individual donors in its first week. Everyone who donates $39 or more gets a personal bottle, with delivery expected in December 2015 or January 2016.
 
The Kickstarter campaign’s proceeds will mostly cover costs for the initial bottle-manufacturing round, which is likely to be larger than expected given the campaign’s success. Nguyen and the team are still working out a retail price for the bottle, but “it’ll probably be in the $39 to $45 range,” she says.
 
For now, interested buyers can reserve a bottle — in the color of their choosing — on Hidrate’s website. Longer-term, Nguyen expects to sell through gyms, sporting goods stores and other retailers. The team is already courting potential partners, though nothing’s ready to announce.
 
“We’re willing to work with any gym, specialty store or retailer that caters to our customer base,” says Nguyen. “We’ve been blown away by early demand for the product and can’t wait for the next phase of our growth.”

 
Hidrate Jobs in Minneapolis
 

1. iOS Mobile Developer
2. Android Mobile Developer

 

It’s no secret that women and minority entrepreneurs struggle to achieve equal footing with their white male counterparts, particularly in the fast-growing science and tech fields. The problem isn’t unique to MSP: According to American Express OPEN’s much-cited 2014 State of Women-Owned Businesses report, women-owned firms account for 30 percent of all U.S. businesses. Though the number of women entrepreneurs is growing at a rapid clip, women-owned businesses still employ just 6 percent of all U.S. workers — a proportion that hasn’t budged since the late 1990s.
 
MSP’s talented cohort of current and future women entrepreneurs may soon lead the nation on these critical representation and employment metrics. Locally based Technovation[MN] is expanding an exciting new initiative to level the playing field for local women and girls, especially those from disadvantaged backgrounds — and seeing impressive early results.
 
Now in its second year, Technovation[MN] helps small, all-female teams conceive, develop and pitch apps to the thousands-strong audience at the global Technovation Challenge, held in San Francisco every June since the late 2000s.
 
Led by Thomson Reuters veteran (now Bluespire marketing director of product development) Shawn Stavseth and sponsored in part by Code Savvy, the volunteer-run organization draws entrants mostly from MSP (including historically disadvantaged areas like Cedar-Riverside and North Minneapolis), its suburbs and the Rochester area. According to International Falls native Stavseth, the organization plans a push into outstate Minnesota over the next couple years.
 
Technovation[MN]’s volunteer mentors — tech-savvy parents, local tech entrepreneurs or computer science entrepreneurs — walk participating kids through an intense, 12-week course that includes ideation, competitor research, big-picture market analysis, actual app building and pitch practice. According to Stavseth, most apps focus on social entrepreneurship.
 
“The girls are incredibly passionate about the social issues of our time,” she says.
 
Each team works roughly four hours per week, usually after school or at local community centers. Due to the significant time investment required and the fact that mentors are usually busy professionals, Technovation[MN] requires no fewer than three mentors per team — basically a one-mentor-to-one-student ratio. The 12-week course culminates in a pitch day called Appapalooza, when each team debuts its idea.
 
In addition to the usual suspects like local financial institutions and tech companies, says Stavseth, Technovation[MN] has cross-disciplinary classroom support.
 
“We’ve heard from English teachers who frame coding as a second language and make the argument that kids who can ‘talk’ to computers will be more successful than those who can’t,” says Stavseth. Meanwhile, “[g]ym teachers and coaches are enthusiastic about the wearable-device revolution” and want students to know how to make fitness apps for those devices.
 
Despite its newcomer status, Technovation[MN] is clearly on the ascendancy. The global Technovation Challenge’s judging panel chooses a relative handful of finalists — this year featured just 10 teams in all, split between high school and middle school groups — from among hundreds of global entries. Though no MSP teams are slated to compete at this year’s event, a Rochester-area middle school team called Furst Class did make the finalist cut.
 
Technovation[MN] is also growing. The group boasted 28 teams this year, up from 11 last year, and Stavseth expects even more to sign up this coming school year, despite a barebones publicity campaign that turns mainly on word of mouth. But Stavseth cautions that Technovation[MN] can only grow so fast: Since its talented teens need intense support from mentors, the total number of teams depends on how many parents, educators and community members are willing to devote substantial amounts of their time to the cause.
 
“We’re very pleased with how things are going, but we’re also fighting a huge battle,” says Stavseth. “There’s a tremendous need to have girls in computer science and to fight the stereotypes associated with the field.”
 

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.
 

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.”
 

 
Kari Severson, a Minneapolis-based inventor and entrepreneur, has a fun, healthy, ultra-connected solution for sedentary office workers: the Walkway Workstation, a “treadmill desk designed with the purposeful user in mind.” On March 2, Severson and her team of contract designers and developers celebrated Walkway’s official launch at Startup Venture Loft (SVL), a North Loop coworking space and startup incubator.
 
SVL will permanently feature at least one Walkway desk, a high-visibility win for Severson’s health-and-productivity startup.
 
“We’re thrilled to have the support of Startup Venture Loft’s tenants and management,” says Severson, a self-professed fitness enthusiast who juggles a full-time job at United Health Group with her entrepreneurial duties at Walkway. “It’s gratifying to see people embracing the Walkway concept so enthusiastically.”
 
Walkway Workstation also recently announced a partnership with MSP International Airport. Severson’s team will deliver two Walkways to Concourse C, near gate C21, and one to Concourse F, near gate F3. More could follow in other locations this year or next.
 
The airport partnership is apt. Severson first came up with the idea for Walkway during a hectic, travel-heavy period in her life. Because her boyfriend was enrolled in graduate school at the University of California Los Angeles, and Severson had a full-time job in MSP and was pursuing master’s program Duke University in North Carolina, she was constantly crisscrossing the country.
 
“With all the travel and a generally unpredictable schedule, I found myself really inactive,” she says. She came up with a concept that improved upon existing treadmill desks, which didn’t feature the amenities or built-in controls that would eventually adorn the Walkway.
 
Each Walkway is a self-contained unit equipped with a sturdy treadmill, ample desk space, device charging ports and a free Internet hotspot. The treadmill’s speed is capped at two miles per hour, a relatively leisurely pace that facilitates multitasking and doesn’t tire out users too quickly. The setup is ideal for individual offices, common areas in open-plan workplaces, waiting rooms and institutional public spaces, says Severson.
 
“The goal is to make everyday lifestyle resources available to busy people,” she says, “and to seamlessly facilitate healthy choices in a convenient setting.”
 
Severson offers several different Walkway configurations, each ideal for a particular end-user. A light-duty treadmill base is ideal for home offices and small workplaces; a moderate-duty base works better in medium-sized, collaborative workplaces; and a heavy-duty treadmill supports near-constant use at large corporate offices, and airports and other public spaces. Each version comes with the user’s choice of a manually or electronically adjustable desk.
 
Though individual buyers and small offices can purchase Walkways at market price, Severson’s team seeks sponsorships to subsidize the cost of units in heavily trafficked public spaces. In effect, each public Walkway is an interactive billboard; sponsors pay for customized user interfaces and prominent, outward-facing logo displays visible to anyone who walks by.
 
And a lot of people can walk by: According to Walkway’s website, about 26,000 people per day walk by the company’s two MSP airport sites.
 
Severson is looking at other revenue-generation ideas, too, including a “freemium” model that offers free access for an initial period, and then imposes a per-minute or per-hour rate for continued use. She’s also mulling partnerships with content providers to deliver premium music and video to users willing to pay a fee for the service.
 
Severson is also keen on the concept of “Walkway pods,” which would feature two, three or more Walkways facing one another — good for “walking meetings” and other collaborative activities, she says.
 

Startup Venture Loft (SVL) tripled its physical footprint with a move into an 8,500 square foot space in the North Loop’s McKesson Building last September. The new digs were the final piece of a year-long rebranding and restructuring process that transformed SVL from Healthcare.mn, a healthcare-focused business accelerator, into a coworking hub and incubator for “investable startup companies with high growth potential,” says owner and executive director Peter Kane.
 
“Expanding to an 8,500 square foot space grabs people’s attention and lets them know we’re serious,” says Kane, who wants to “make the Twin Cities the best place in the country to launch a startup.”
 
Thirty early stage companies mostly in the healthcare and technology sectors now rent space at SVL, up from just five in November 2013. Healthcare.mn remains an SVL tenant.
 
Turning the Twin Cities into a tech hub requires a self-contained ecosystem of entrepreneurs and talented knowledge workers, plus venture capital funds, angel investors and service providers such as intellectual property lawyers and marketing specialists, who support and promote entrepreneurial efforts.
 
Kane cites Chicago—a city not known for its technology industry until recently—as a model for the Twin Cities. 1871 is the beating heart of Chicago’s tech startup scene, with tenants ranging from idea-stage one-person companies to established VC funds that funnel capital into proven technology concepts. Decision-makers from big technology and healthcare firms, including Google, either rent space in or routinely visit 1871, providing startups with access to larger, more lucrative markets and creating buyout opportunities—known as “exit strategies” in startup parlance.
 
SVL also aims to bridge a generational and cultural gap that hinders local startups’ growth. Many Twin Cities entrepreneurs, especially in tech and healthcare, are Millennials with different values and business strategies than the older, more experienced executives and investors they typically pitch ideas to. Kane’s two previous startups both failed in part, he says, because established company executives didn’t take him seriously.
 
“Our culture is somewhat risk averse, which isn’t necessarily a bad thing,” says Kane. “But [decision makers] want to know that you’ve been vetted, and that’s a tough sell when you’re a 20-something entrepreneur and everyone across the table from you is a baby boomer Pharm.D.”
 
“The response is often ‘who are you’ and ‘why should I trust that you know what you’re doing,’” he adds. “There isn’t the sort of informal vetting network that exists in more established tech centers like Silicon Valley and New York.” Kane wants SVL to be a core node in that network. With the support of a competent, technology-driven community, entrepreneurs associated with SVL would have a de facto stamp of approval from investors and corporate decision makers.
 
Bringing entrepreneurs and business leaders together also requires a mature digital media sector that trumpets the Twin Cities’ startup scene as worth of national and international attention—and investment.
 
“We’re not always great at telling our story [in the Twin Cities],” says Kane. “We need a beacon—the media—that churns out stories with national appeal and raises the local startup scene’s profile to where it needs to be.”
 
 

SPS Commerce, a retail supply-chain software company that occupies six floors in downtown Minneapolis’ Accenture Tower, has added about 200 employees since 2012. “And the rate of hiring is not slowing down,” says Peter Zaballos, VP of marketing and product. SPS Commerce has more than 800 employees as of this month. The company just added a new floor to its downtown headquarters, with an option for additional space in the building.
 
“We’re positioning to become a world-class, global supply-chain business” in the tech space, he adds. “That’s making us a magnet for talent in the Twin Cities region and around the world.”
 
Most of SPS’ employees work at its Minneapolis headquarters. The firm also has a big presence in New Jersey, as well as international operations centers in Beijing, Hong Kong, Mumbai, Sydney, Melbourne, London and Kiev. Each office will grow “organically” even as SPS adds employees in Minneapolis, says Zaballos.
 
SPS Commerce’s ambition got big boost last month, winning MHTA’s prestigious Tekne Award for best software platform in the “established company” category. SPS was one of 12 Tekne winners this year, out of more than 100 entrants. According to an SPS release, the company won plaudits for “embracing innovation and the changes that today’s retailers are facing, while giving global organizations access to an established online trading community.”
 
“The Tekne win really communicates to the local and national tech communities that SPS is on the forefront of the ongoing reinvention of retail,” says Zaballos. “We’re on the move.”
 
SPS Commerce is also raising its profile in the booming Twin Cities tech community. The company’s CEO and CTO earned Minneapolis/St. Paul Business Journal’s prestigious Titans of Technology Award in September. And the company routinely hosts events for programmers and business professionals at its offices.
 
“We enjoy sharing our success with other members of the local technology community,” says Zaballos. “It’s a great opportunity.”
 
Zaballos and other SPS executives are thrilled with the Twin Cities tech community’s progress. Zaballos came to SPS less than three years ago, after extended stints in major coastal tech hubs: Silicon Valley, Boston, Seattle. He’d never set foot in the Twin Cities. But he was “stunned by the breadth, vibrancy and depth” of the industry.
 
“The quality of the people here is amazing,” he says. Local professionals are also “aware of the game they’re playing”—a game, Zaballos argues, largely controlled by elites in the Bay Area and New York. “To compete on a global basis, you need to play in that league,” which the Twin Cities does very well, he says. Finding competent, talented workers is easy here.
 
SPS Commerce helps retail clients manage and expand digital sales channels, providing analytics, inventory management and seamless interfacing with suppliers and other software platforms.
 
“Things that seem easy to do when you’re shopping online are actually super complicated for retailers,” says Zaballos. A dramatic increase in mobile device use complicates matters further. “Mobile shoppers are especially high maintenance,” he says.
 
More than 55,000 retailers and suppliers now use SPS’ solutions. But most local residents have still never heard of SPS Commerce, despite current revenues of nearly $130 million.
 
When Zaballos took his current job, the company had no marketing department to speak of. “Our sales team was and is really good at getting suppliers into our network,” he says. “We got to around $100 million in revenues and tens of thousands of users before anyone [outside the retail industry] had heard of us.”
 
SPS kept its low profile despite an IPO back in 2010. It’s listed on the NASDAQ, under the ticker symbol SPSC. “Being public is a big advantage for us,” says Zaballos. “Prospective clients and employees can look at our annual reports and financial disclosures and know that we’re a fundamentally sound, growing business.”
 
One item of note in SPS’ public filings: The company currently has $170 million in cash on hand, an impressive sum for a firm of its size. That cash pile will support SPS’ aggressive hiring and expansion drives—and possibly spur more exciting investments in the future.
 
And the company is finally investing in publicity for itself. “We’re thrilled to be telling our story,” says Zaballos. “We want talented Twin Cities professionals who share our values to see a future with us.”
 
Current SPS Commerce Job Listings in Minneapolis
 

1. Account Executive
2. Business Analyst
3. Marketing Acquisition Manager
4. Software Engineer
5. Supply Chain Strategist