Innovation Roundtable: Entrepreneurs Share How Launch MN and the Angel Tax Credit Helped Them Succeed

St. Paul – Minnesota Department of Employment and Economic Development (DEED) Commissioner Steve Grove and Launch Minnesota Executive Director Neela Mollgaard were joined by entrepreneurs and support organizations Friday for a discussion about what startups need to be successful and how Minnesota can encourage more investment in entrepreneurship and innovation.

This roundtable was part of a broader series of discussions the agency is hosting called “The Next Minnesota Economy,” focusing on inclusive economic growth, reskilling our labor market and creating good jobs.

“This legislative session, the Governor’s budget includes critical investments for Launch Minnesota and the Angel Tax Credit,” said DEED Commissioner Steve Grove. “Growing our startup economy will help to fuel inclusive economic recovery and increase jobs across Minnesota.”

For one thing, innovative businesses and industries using new technologies have been shown to be stronger “job multipliers” – meaning more jobs are created to support and service them.

“To date, Launch Minnesota has awarded $2.8 million to 88 unique startups,” said Launch Minnesota Executive Director Neela Mollgaard. “We’ll soon be announcing the next round of awardees that will fully allocate our second-year startup funding by March, so clearly the demand is great – and this is only about 30% of the total dollars requested.”

Meanwhile, the Angel Tax Credit provides a 25% credit to investors or investment funds that make equity investments in innovative Minnesota startups. In 2021, $10M was allocated by the state legislature. As of March 22, there were $1.2 million in general credits and $4.3 million in credits reserved for targeted populations.

“The Angel Tax Credit was incredibly valuable for us,” said Ann Holder, founder and CEO of Marani Health. “You find investors that are really interested and it’s the thing that gets them over the finish line to actually invest in your company. It was just very powerful and incredibly helpful.”

Her company grew out of an idea from a physician at Mayo Clinic to apply technology from cardiology monitoring to maternal and fetal monitoring. It entails an artificial intelligence platform to remotely track maternal and fetal health during pregnancy, labor and delivery.

Given the high rates of maternal and fetal morbidity in the U.S., Holder said, “I jumped at the opportunity to try to develop some technology that could actually improve outcomes and try to give doctors a lot better information.”

Lori Most, founder and CEO of Binary Bridge, said her company has benefitted from both the Angel Tax Credit and a Launch Minnesota innovation grant – but that she would not have known about them if not for Twin Cities Startup Week. Without the approachable entry point that it offered, Most said, “I would just not have looked at the state of Minnesota as an option.”

Most’s background is in software technology and development and her company grew out of a medical mission trip she took with her sister to Peru. Because they had no electricity or internet, all the medical documentation was on paper which hampered the medical team’s ability to understand patients’ medical histories and provide quality care. Her company’s solution is BackpackEMR – an offline emergency medical record that allows for the sharing of data without the internet.

Asked what makes Minnesota appealing to companies from other states and countries, Frank Jaskulke, vice president of intelligence at Medical Alley Association, said, “They know that if they build a company in Medical Alley in Minnesota, that it will be high quality, it will be effective, and it will be a real, actual business that makes an impact around the world. For entrepreneurs that matters to, there’s probably no better place on earth to be than right here.”

Launch Minnesota continues to build momentum by moving startups forward, leveling the playing field and amplifying opportunities and successes across the state.

Other participants in the roundtable included:

• Pat Dillon, founder and director of the MN SBIR/STTR Accelerator

• Reed Robinson, founder and partner, Groove Capital

• Kathy Tune, CFO of Agitated Solutions

• Sean Williams, director of entrepreneurial services, Rochester Area Economic Development Inc. (RAEDI)

You can watch a recording of the Innovation roundtable on DEED’s YouTube page.

DEED is the state's principal economic development agency, promoting business recruitment, expansion and retention, workforce development, international trade and community development. For more details about the agency and its services, visit the DEED website or follow us on Twitter.