Downtown : Innovation + Job News

A local software shop is experiencing some healthy growth.

PowerObjects helps companies configure and customize Microsoft Dynamics relationship management software, which helps organizations keep track of information about their clients, customers or sales leads.

The company was Microsoft's fastest-growing partner in its last fiscal year. COO Jim Sheehan says revenues are on track to be 40 percent over last year. In June, PowerObjects announced an expansion of its office in the SO|HO building in downtown Minneapolis, where it employs 32 people.

Sheehan credits the company's growth to its "laser focus" on Microsoft Dynamics software. Until three years ago the company was much less specialized and did a variety of custom software projects for customers.

"It was pretty scary for us. We had a few million dollars in business in other software lines, and we said: Nope, we're going to get rid of it all," Sheehan said, and focus exclusively on implementing Microsoft Dynamics software.

As a result, they're known at Microsoft, and that's resulted in some major business referrals.

It also has an expertise in software for health care and life sciences--"pretty much anything that relates to or could touch a patient," says Sheehan.

The company also has about 15 employees in Texas at offices in Dallas and San Antonio.

Source: Jim Sheehan, PowerObjects
Writer: Dan Haugen

Another prize should help extinguish any doubts about EarthClean's potential.

The Minneapolis startup, which produces a non-toxic, biodegradable firefighting gel, was one of three winners named last week in the region's first annual Cleantech Open competition.

Other winners for the Cleantech Open North Central region were Xolve, a Platteville, Wisc., company that makes nanocoatings for energy generation and storage, and Silicon Solar Solutions of Rogers, Ark., whose technology improves silicon-based solar power cells.

NewWater, a startup that's using University of Minnesota technology to develop an atrazine filter for municipal water treatment plants, won given a regional sustainability award.

EarthClean (which we've previously written about here and here) was also the grand prize winner in this year's Minnesota Cup entrepreneur competition.

The field for the Cleantech Open North Central competition also included companies from Iowa, Kansas, Nebraska, North Dakota, and South Dakota.

"That's a really important part of the program, to connect all these different geographies and create this ecosystem across the entire Midwest," says regional director Justin Kastor.

The three winners will receive a prize package that includes cash and services worth up to $30,000. They'll also compete for a $250,000 prize at a Nov. 17 national competition.

Next year's North Central competition is likely to include companies from Ohio and Illinois as the Cleantech Open prepares to launch a separate Midwest division in 2012.

The organization aims to help create 100,000 green-collar jobs in the United States by 2015.

Source: Justin Kastor, Clean Tech Open
Writer: Dan Haugen

A Minneapolis software developer is expanding his solo business into a three-person firm this month and moving into an office in the Loring Park neighborhood.

Jon De Long started the Composit Group in July 2009. His company makes automation software to help large, custom manufacturers operate more efficiently. The CAD software lets someone input order specs and generate custom product designs on the spot, instead of having a sales rep relay specs to an engineer.

De Long signed a lease last week on a new office space. (He previously worked from his condo.) He was hauling in equipment by the end of the week. He was also preparing to hire his first two employees by the end of the month.

"Right now, with the economy, manufacturers have the impetus--and oddly enough, also the cash--to try to improve upon their processes," says De Long. "We want to scale up now so we can handle the business down the road."

Source: Jon De Long, Composit Group
Writer: Dan Haugen

After signing a lease for its future brewery in downtown Minneapolis, Fulton Beer has a plan for its next round of growth.

First, though, it needs to make sure it can pay the tab.

The company is named after the Minneapolis neighborhood where the its four founders started home brewing together. They started leasing time at at Wisconsin brewery last fall so that they could brew beer for commercial sale.

The guys--Ryan Petz, Jim Diley, Brian Hoffman and Peter Grande--have doubled production twice since then, and their hoppy Sweet Child of Vine brew is now on tap at a little over 100 bars and restaurants in the Twin Cities.

About six months ago they started searching for a spot to build their own brewery, and last month they signed a lease on an empty warehouse just northwest of Target Field at 414 N. 6th Ave.

"We couldn't be happier with what we found," says Petz.

The plan is to construct a 15- to 20-barrel brewhouse that would be open to the public for tours and growler sales. They're talking to architects, contractors, and equipment manufacturers. The time line will depend on financing.

"As you can imagine, it's a pretty expensive endeavor. We're looking at getting some traditional bank financing, but are not exactly sure how that is going to play out," says Petz. "We've been able to start saving a little bit of money from our current operations, but it may be that we have to continue to do that longer or find some other alternative means in order to get this thing together."

They're hoping to be brewing beer within about six months of securing financing.

Source: Ryan Petz, Fulton Beer
Writer: Dan Haugen

Tommy Creal rolled into town two years ago on a custom-built chopper with a full tank of ambition.

This fall, the young entrepreneur is retooling his business in hopes of finding the right gear.

As a teenager, Creal started a popular bike-building bootcamp in Chicago. After moving to Minneapolis in 2008, Creal decided to relaunch Chopper College as a "green" technical institute.

Creal's Chopper College partnered with Minneapolis Community & Technical College on a catalog of 40 courses last year aimed at gearheads interested in building alternative-fuel motorcycles.

The demand wasn't what he hoped for, so this fall he's scaled back to two one-weekend workshops that will teach participants how to build a bike that runs on E85 ethanol.

Creal's E85 bike-building workshops will be open to 48 students each. Over the course of three days (Oct. 8-10 or Nov. 12-14) students will help build a pair of motorcycles from scratch.

Meanwhile, Creal is keeping busy on the side by building custom choppers for local organizations, from the Minnesota Wild to Life Science Alley.

If the workshops suggest there's interest in ethanol-powered choppers, Creal says the next phase for Chopper College will be developing a gasoline-to-ethanol conversion kit to sell.

The lower than expected enrollment for last year's classes hasn't soured Creal on the Twin Cities. Instead he says he's struck by how much support there is for businesses here.

"People are lending hands everywhere, opening doors for us, and I'm just trying to figure out how to give back, because everybody's been giving to us," says Creal. "You can trust me on this: it's not like Chicago where everybody's out for themselves."

Source: Tommy Creal, Chopper College
Writer: Dan Haugen

A Minneapolis health-care startup is hiring as its service graduates out of beta.

Bloom Health aims to simplify the process of picking out health insurance for both employers and their employees. Instead of choosing a few health plans to offer their workers, employers deposit their contribution to a pre-tax Bloom account, which employees can apply to any plan they choose.

CEO Abir Sen says their service is like a Charles-Schwab-meets-eHarmony for health insurance. Bloom acts as a broker and matchmaker. Employees take a survey that measures their health, finances, and appetite for risk and then recommends health plans based on those factors.

The company launched last September and hoped to have one customer by this fall, says Sen. Instead, it announced late last month that five Twin Cities companies are now using its service. Meanwhile, the company is hiring. It has 19 FTEs today and expect about 25 by the end of the year.

"We found the market to be very ready," says Sen.

Sen compares the shift that's underway in health insurance to what happened with retirement saving in the 1980s. Companies were under stress from rising pension liabilities, so they transitioned to 401(k) plans, contributing funds but letting employees invest them as they wished.

Today, says Sen, we're seeing a similar climate around health care with rising costs, recession and regulatory changes.

Source: Abir Sen, Bloom Health
Writer: Dan Haugen

An interactive marketing agency that counts Hulk and Spider Man as clients has developed a superpower of its own: growing in a downturn.

Antidote X, based in Minneapolis, has been working on interactive campaigns for some major entertainment companies, including comic book giant Marvel. The company recently hired six new employees, more than doubling its size since the start of the year from five people to an 11-person team today.

The company has been around for more than a decade, formed in 1998 by a pair of former developers from Campbell Mithun and Carmichael Lynch. It specializes in designing and developing integrated multi-platform strategies-- campaigns that look and feel the same whether a person is accessing them through a mobile app, their Facebook page, or a micro-website.

"The experience is only different in regards to the platform that it's being delivered on," says co-founder Paul Nealy.

Other clients include DreamWorks, video-game publisher THQ, and bath and kitchen product manufacturer American Standard, whose Antidote X-designed website was recently reviewed as one of the best corporate-designed websites.

While some companies have cut their marketing budgets in recent years, Nealy says in general they're observing an increase in spending on online and interactive--a good thing for a city that's a hub of interactive marketing.

Source: Paul Nealy, Antidote X
Writer: Dan Haugen

A nice thing about taking the skyways: you can walk around with your phone in front of your face and not worry about getting hit by a car.

A pair of local developers have created a free iPhone app to help people navigate and explore the Minneapolis skyway system.

The Minneapolis Skyway app, by Frypan Digital, includes a map and business directory that lets users search for stores, see reviews and save favorites.

Co-creator Casey Holley says the app has been downloaded more than 3,000 times since it was posted in the App Store a few months ago. They're hoping downloads will pick up some when winter arrives and more people are using the skyways to avoid the elements.

"We've had a real steady number of downloads," says Holley. "I think it's just iPhone users saying man, this is confusing, there has to be an app for that."

One of the biggest challenge so far has been keeping information up to date. With around 400 different retail spaces, there's a fairly regular turnover among tenants. They're relying largely on the crowd to keep track of changes, which has worked well so far.

Holley says they've had lots of requests for an Android edition. That's in the long-range plan, but for now their focus is increasing use of the iPhone app and then building out services for skyway business owners to advertise and promote specials.

Source: Casey Holley, Frypan Digital
Writer: Dan Haugen

A Minneapolis cleantech startup is loosening the nozzle after raising at least $765,000 from investors to roll out its non-toxic, biodegradable firefighting gel.

EarthClean recently disclosed that it was about a quarter of the way through a $3 million round of equity financing. The company's product, TetraKO, is a low-cost, environmentally safer alternative to conventional firefighting foams.

"We've had a couple of fire chiefs tell us that they understand it performs better, but quite frankly if it was just as good as foam they'd buy it because of the environmental aspects," says EarthClean CEO Doug Ruth.

TetraKO is a patented dry-mix product that, when mixed with water, forms a non-toxic gel that sticks to surfaces and suppresses flames. It was developed over the past decade by a Woodbury volunteer firefighter and a trio of former 3M and H.B. Fuller chemists and engineers.

Ruth acquired their patents and founded EarthClean a couple of years ago. The company is getting ready to manufacture its first 10,000 pounds of the product in the next two weeks and will have it available for commercial sale within four weeks.

It's hitting the market at a time when there's growing concern about the pollution left behind by chemical-based foams and gels. Minnesota health officials last year were investigating potential drinking water contamination in 15 cities. And a federal judge in Montana ruled last month the U.S. Forest Service is breaking the law when it uses harmful chemical retardants on wildfires because they can hurt fish and wildlife.

EarthClean's product is certified as non-toxic and biodegradable and offers a safer alternative, says Ruth. "It's a game-changing technology that really could change the way the world fights fires."

(Also: EarthClean is a division finalist in the 2010 Minnesota Cup competition. See our update here.)

Source: Doug Ruth, EarthClean Corp.
Writer: Dan Haugen

A local software firm is attracting global customers for its cloud-computing services.

Minneapolis-based enStratus helps companies manage their cloud-computing activities. Cloud computing is a term for using data or applications that are stored online rather than on a desktop computer's hard drive.

"In 2010, what we've done is managed to become a global business," says George Reese, the company's founder and chief technology officer. And he has numbers to back it up.

As of mid-August, 80 percent of the company's new customers this year have been from outside of the United States. A year ago, enStratus didn't have any non-domestic customers.

The company handles everything from accounting to security for companies that buy cloud-computing resources from companies like Amazon, Google or Rackspace.

Its uptick in global customers coincides with the introduction of multi-currency financial support; enStratus' product can convert and track a company's spending whether it's in dollars, euros, or another unit.

With its new global customer base, enStratus announced this week that it's adding a couple of internationally known cloud-computing experts to its board of advisors:

James Urquhart is a senior market strategist for cloud computing at Cisco and author of a respected CNET blog, The Wisdom of Clouds. He's also a Macalester grad and former Twin Cities resident.


Simon Wardley is a researcher for CSC's Leading Edge Forum and an international speaker on the commoditizing of IT, utility computing, fabrication technologies, and the open-source movement.

Source: George Reese, enStratus
Writer: Dan Haugen

Americans spend more time on Facebook than any other website. A Minneapolis social commerce company is giving users one less reason to sign off.

Alvenda announced the rollout last week of an e-commerce Facebook tab for Delta Air Lines. The service is the first of its kind for the travel industry and allows Facebook users to search, book, and buy flight tickets without ever leaving the site.

The idea behind Alvenda's technology is to embed their clients' stores on the websites where their customers are already spending time. It also allows retailers to embed stores within advertisement boxes and as a widget on publishers' sites.

Alvendra was founded in 2008 and was the winner of the 2009 Minnesota Cup competition. Its team consists of about 20 people, and it continues to grow, according to product strategist Erik Eliason. Large companies are very interested in social media, he says, and Alvenda's tools give them a way to monetize and prove the ROI of a network like Facebook.

Other services allow companies to add shopping tabs to Facebook pages, he says,  but most of them redirect customers to other sites where the transactions are completed. In e-commerce, retailers generally lose customers at every click they require. "You want the search and the transaction to be as frictionless as possible for the consumer," says Eliason.

Alvenda opened the first retail store inside Facebook last summer for 1-800-Flowers.

Source: Erik Eliason, Alvenda
Writer: Dan Haugen

"Little" might be in the company's name, but a Twin Cities design shop is thinking big with its web video series.

Little & Company, a strategic design firm that employs about 40 people in downtown Minneapolis, is preparing another batch of videos for its Thirty Conversations on Design project, and they feature some high-profile names, says creative director Joe Cecere.

The series started last year as a celebration of the agency's 30th anniversary. It reached out to 30 creative professionals around the world and asked them to answer, via video, two questions: "What single example of design inspires you most?" and "What problem should design solve next?"

The results were posted on a website where designers, authors, architects, marketers and others could go to find inspiration, as well as participate in a conversation around the videos. In the spirit of TED talks, Little & Company now plans to build on the archive, adding more videos each year.

Little & Company cast a wider net with this year's interviews. Cecere says they wanted to expand beyond graphic design and marketing and include creative fields such as architecture, fashion, and filmmaking. The selection process was the same as last year.

"We get a group of us here. We get together in a room and we put our dream list together," says Cecere.

They draw ideas from pop culture, magazines, and design annuals. Cecere then starts reaching out to people on the list, and if they agree, they box up a digital video camera with instructions and drop it in the mail. This year's confirmed participants include design editor Allan Chochinov, author Daniel Pink, and skateboard entrepreneur Tony Hawk.

"The nice thing about the questions is they're universal enough and they're kind of timeless," says Cecere. "What's going to be interesting every year is to have a new perspective based on what's happening in the world and how those answers change."

Cecere says this year's website, which is scheduled to launch next month, will be more robust, with better tools for interacting with other viewers and sorting and searching the videos. The company is also considering staging a speaking event or series involving some of the participants.

Source: Joe Cecere, Little & Company
Writer: Dan Haugen

OrthoCor Medical kicked off sales last month for its first device: a knee wrap that uses heat and electromagnetic pulses to alleviate pain and swelling.

The product, called the OrthoCor Active Knee System, sells for about $200 and runs on a rechargeable battery and disposable, single-use heat "pods."

The Twin Cities company has been gearing up for sales since December, when the U.S. Food and Drug Administration approved the device for sale. In February, OrthoCor disclosed plans to raise $1 million from investors to grow its sales and marketing force. CEO John Dinusson said in an interview last week that fundraising has since exceeded $1.5 million.

(OrthoCor was the first business certified under Minnesota's new angel investor tax credit program.)

While investors appear to be enthusiastic, insurers remain skeptical. Clinical data about the product's effectiveness is limited, which will hinder any efforts to win reimbursement from insurers. Instead, the company is counting on chiropractors to be the primary distribution channel for the device.

"We know that we have a huge patient population," says Dinusson. An estimated 26 million people in the United States suffer from knee pain, and many become less active instead of seeking treatments, says Dinusson. He hopes their product can change that trend.

OrthoCor has five employees, including inventor Kin-Joe Sham. The devices are manufactured at Sham's father's company in China, and Dinusson has been contracting independent sales reps. Several other products are in the pipeline, including devices for relieving wrist, ankle, elbow, and lower back pain.

Source: John Dinusson, OrthoCor Medical
Writer: Dan Haugen

A revolving investment fund at the University of St. Thomas helped five promising Minnesota technology companies get through a tough year.

The William C. Norris Institute at St. Thomas' Opus College of Business invested $280,000 during its 2010 fiscal year, which ended June 30. That included an investment in an undisclosed cleantech startup that's still in stealth mode, as well as follow-up investments in four companies that were already in the program's portfolio:

    �Apinee, which makes an environmentally friendly wood treatment

    �Dejen Digital, a web portal that aims to streamline music and dance tryouts

    �Seeonic, which makes an RFID-equipped retail display to help track inventory

    �and Xollai, which is developing a system for landing unmanned aircraft

Norris Institute Director Mike Moore said it was a difficult year for everyone.

"It was just survival. If a company matched its sales from the year before, or just lost a little bit, that was more than could be expected," Moore said.

The fund was created by the late Control Data Corp. founder and CEO William Norris in 1988 to support early-stage technology-based companies in Minnesota that address social needs as well as business opportunities. In 2001, the program became part of the St. Thomas business school, where students now help perform due diligence and other tasks related to running the fund.

Moore said this year he hopes to make first-time investments in four or five companies. Entrepreneurs can find guidelines and information about submitting business plans at http://www.stthomas.edu/norrisinstitute

Source: Mike Moore, William C. Norris Institute
Writer: Dan Haugen

A Minneapolis digital communications firm is grabbing attention--and bystanders--with a new interactive billboard in Times Square.

Space150 recently became the agency of record for Forever21, the trendy youth fashion chain. Its first project: creating a giant high-tech display for the retailer's flagship store in New York's Times Square.

In most places, a 61-foot-tall video screen would be enough to turn heads, but not in Times Square. Over the past decade the center has been overtaken by increasingly enormous screens to the point that it now looks like a sports bar for giants. Space150 decided to go different instead of bigger.

"We looked at it and said this is almost like a giant computer screen, versus a television screen where you just have the one-way interaction," says space150 founder/CEO Billy Jurewicz.

The firm created a series of interactive "episodes" that rotate across the screen. One displays recent tweets that include the phrases "love" and "Forever21." Another is "Forever Runway," an ongoing loop of user-generated videos showing fans walking from one side of the screen to the other.
 
The real eye-catcher, though, is a bit called "getting picked up by a model." A super-high-definition camera mounted on the billboard displays a real-time stream of the people standing below. A superimposed model enters the screen, then reaches out and plucks a person's image from the live video feed. The model might kiss the person, or put them in a shopping bag, or flick them away.

"This is sensational. It's a live image of the crowd. People just start mobbing like they're watching the World Cup or something," says Jurewicz. "If you see it, you're going to say that's something you want to do as a tourist in New York, to go get picked up by a model at Times Square."

Jurewicz founded space150 in March 2000. The company recently celebrated its tenth anniversary in the midst of an expansion. The firm has grown to about 140 employees from about 90 at the start of the year. It's hired about 20 in the past three weeks alone.

Source: Billy Jurewicz, space150
Writer: Dan Haugen