An Industry Watch + features a collection of stories, Q+A's, How-To's and more to give readers a 360 degree look at industries.
This month's Industry Watch + takes a closer look at tech in Minnesota, including elements of a successful startup, creating farm teams, and how tech can help Greater Minnesota gain jobs.
How Tech Can Help Outstate Minnesota
A natural match: Metro tech companies need talent, while outstate Minnesota needs jobs
Dilema: Greater Minnesota needs jobs, while Metro tech firms need people. What if there was an overlapping solution? What if there was a way to bring tech jobs to the rest of Minnesota?
Doing so could increase the talent pool to businesses, normalize talent costs and bring jobs and wealth back to greater Minnesota. It may also help heal the economic and political rift between the Twin Cities and the rest of the state — and unite them around a shared vision of the future.
While the path forward is full of challenges — such as misconceptions about tech jobs, and the lack of infrastructure and capital — several outstate cities are already leading the way to a potential technological revolution.
Rochester: A new co-op space
Long-known for the Mayo Clinic and its burgeoning health care ecosystem, Rochester is also encouraging local startups, such as GoRout, which has attained national attention for its football helmet app. And less than a year ago, Jamie Sundsback launched Collider Coworking in downtown Rochester. The co-working space hosts meetups every week to discuss ways to build the startup community.
“Rochester is a traditional Minnesota city, risk-averse, with big successful companies and comfortable employees,” says Sundsback, who serves as the community manager of Collider. “But,” he says, “more people are beginning to understand the opportunity in the area. Tech entrepreneurship is happening here.”
Red Wing, creating pathways
Tech startups are also taking hold in Red Wing, a city known for its low-tech products like shoes and pottery.
One catalyst for building a startup community is Red Wing Ignite, an organization devoted to helping the community grow an innovative and entrepreneurial ecosystem. It is plugged in to a couple of dozen communities across the country doing the same thing through a national organization, US Ignite.
“US Ignite has helped us facilitate conversations and has provided support for ways to develop the entrepreneurial ecosystem” says the Executive Director of Red Wing Ignite, Neela Mollgaard. This applies to teachers and parents alike. Changing a community starts with awareness. “Education plays a key role in developing the ecosystem” says Mollgaard.
One of the biggest challenges facing education is having teachers with enough experience in technology to be able to teach the curriculum, while parents need to become aware of the opportunities to help their children get on the path of a good-paying job.
Mollgaard and Ignite are working on developing a STEAM education platform (science, technology, engineering, art, math, and design), bringing in organizations like TechnovationMN, Apps for Good and Coder Dojo. Ignite also partners with local colleges to focus curriculum on tech, and facilitate internship programs to expose kids to technology and entrepreneurship early on.
Options are abundant for parents and teachers to engage their kids with technology. Kids can get involved now with robots, video games, online courses, YouTube and online resources such as Scratch, a free, online, entry-level programming language developed by MIT to teach programming fundamentals to kids.
These efforts help move Red Wing forward, but much needs to be done. “Challenges are pretty universal — access to capital, lack of awareness and opportunity, and a lack of clear economic impact,” says Mollgaard.
Access is a very real issue for outstate areas. While some don’t have enough investors visiting, some don’t even have Internet access. Access to jobs is the most pressing thing. Most areas in greater Minnesota are not seen as a communities with tech talent or even an interest in tech. As tech has a misperception, so too does greater Minnesota.
Fargo, North Dakota & branding
To counteract this disconnect, cities can carve out their own brand. Tech is no longer isolated to single locations. It is evolving into a network of communities of talented people solving problems they are uniquely skilled at; therein lies the opportunity. In this way, rural areas can continue to develop the brand they are already skilled at, and bolster it by leveraging technology.
Fargo is building its brand and is booming with tech — especially drones. “Fargo is becoming a key player on the global stage with drone and precision agriculture technology,” says Greg Tehven, the executive director of Emerging Prairie, a nonprofit that promotes tech startups through events and a coworking space.
Says Tehven, “Emerging Prairie is here to connect and celebrate entrepreneurial ecosystems in three key ways: Connect people to help facilitate the network effect, provide platforms for entrepreneurs to share what they are doing, and support by helping startups find the first customers, partners, employees or investment.”
With this kind of support and innovation in a vertical that North Dakota is long known for, Fargo is quickly making the transition to being a part of something larger, a connected tech community. Many communities out there are. Tech is making an impact in outstate areas around the country. The talent is there, the opportunity is there, and it’s going to take both sides to make it happen.
Bridge project to rural Minnesota
Putting jobs back in rural areas is a big challenge and will require an intense amount of collaboration. It starts with an openness from both communities. This is ultimately a bridge project: two groups on different sides of the bridge working to connect in the middle.
Success means jobs in greater Minnesota and wealth moving back into local communities. Tech jobs have a multiplier effect. Studies have shown that for every tech job created, three to four other jobs in the community are created as well. This is a real opportunity to stop the talent drain and revitalize towns. New ideas outside of the traditional limits of urban centers can help companies grow and connect in new ways. Businesses will be fueled by talent at all levels, equalizing supply and demand.
It starts with a conversation. Leaders are needed on both sides to make this a priority.
Start a meetup. Start a coworking space. Make connections. Network. Find a counterpart that wants to work with someone to solve this problem.
Common Elements of a Successful Tech Startup Ecosystem
TechStar co-founder Feld gives a recipe for building your tech startup ecosystem in his book, Startup Communities. Here are some key ingredients:
Coworking spaces are popping up across the world. Minneapolis is now somewhere north of 20+ and quickly growing. Don Ball, cofounder of CoCo, says “CoCo is like a coral reef of many different species exchanging ideas and support”. Much more than just a place to get work done, the participants of this ecosystem help each other in a multitude of ways. They may be a future customer, an employee, a partner in venture or a service provider. They provide feedback to each other and much needed support early on. Coworking spaces also are one of the homes to the next critical component, events.
Events are where learning and connections happen — meetups, demos, business competitions and pitch sessions. This is where companies start, the next big idea is thrown out, and the fibers of the community are strengthened. Minnestar, known as the flywheel of Minnesota Tech, puts on some of the biggest events. Minnebar, the biggest barcamp (or unconference), gathers more than one thousand people once a year to talk about ideas, and connect. Minnedemo is a pitch event that puts seven products on stage for seven minutes, providing a platform for entrepreneurs to get their work in front of a massive amount of people.
These platforms help entrepreneurs overcome one of the biggest obstacles for startups: visibility. Platforms provide startups with an audience to get their ideas in front of potential customers, cofounders, investors and future employees. Several platforms in the Twin Cities provide these opportunities for startups. MNCup is one of the biggest business competitions in the country. This platform provides mentors, training and a competition to really challenge entrepreneurs to think through the idea and ways to take that idea to market. Beta.MN, Ignite, TedX, and many others also provide platforms to showcase work being done in the community.
One of the key elements of events is to be connected with successful organizations. “Successful communities are part of a broader community” says Greg Tehven of Emerging Prairie in Fargo. They leverage the power of existing networks like TedX, Techstars, 1 Million Cups, and others to connect their community with a broader audience. Furthermore, it’s important for these communities to network with each other to discuss what works. For example, Tehven of Emerging Prairie shares advice with Jamie Sundsbak of Collider in Rochester, Minnesota.
Of the many things that broader networks provide, perhaps the biggest is support. Broader communities like TedX, US Ignite and Google for Entrepreneurs have been to the mountaintop. They know what works and what doesn’t. This support is critical to efficiently building communities and events. Local communities can tap into the network to get ideas, speakers, and ways to leverage the brand to attract people to events.
Equally important is to support each other. Successful entrepreneurial ecosystems have a ‘give first’ mentality. Those who have been down the path help guide others and support them along the journey. They help each other find partners, customers, investors and ways to create visibility. Minnesota is fortunate to have a give-first culture going back to our agrarian roots.
These are just a few of the critical elements necessary along the journey to building a successful entrepreneurial ecosystem. Many more ideas can be found in a multitude of books and online resources.
The common thread across these communities is entrepreneurship. Someone stood up in that community and said, “There is an opportunity, and it’s our responsibility to pursue it, invest and make something happen.” They hold up the flag every day and help push the community forward.
That is entrepreneurship, and that is what builds community.
Start by learning more about Minnesota Tech.
Let's Try Tech Farm Teams
Today, tech jobs can be done from anywhere. “Location no longer matters where we work,” says Greg Tehven, from Emerging Prairie in Fargo. The opportunity is there for companies to support rural areas by allowing remote workers there.
Remote work is a key way to bring jobs back to rural areas. It begins a cycle that can fuel jobs and economic growth.
Twin Cities startup When I Work has a multitude of remote workers. Founder Chad Halvorson, from greater Minnesota himself, uses talent from all over the country.
Keith Sweet, engineering manager at When I Work, works from his home, 10 minutes outside of Rapid City, S. D. And Matt Kleinsasser, sr. DevOps engineer at When I Work, lives in Watertown, S. D.
These tech workers wanted to live in small towns, but there were no jobs. The solution was to work remotely for an urban tech company, an industry short of talented workers.
What if we expanded on that model?
Build a farm league
Major League Baseball built its empire by establishing farm leagues in small towns. They scouted the best players and built a tiered system to prepare them for the majors. Maybe that metaphor also fits for growing tech talent.
Dennis Still agrees. “We should think about it like the farm system in baseball. We could engage with kids and young adults and continue to develop and support them.”
He knows from experience growing up in Montana that you also need buy-in from the townspeople to convince them it is a model that could build jobs.
“You need to overcome some hurdles related to rural v. urban thinking,” says Dennis Still, When I Work’s head of analytics, who formerly lived in a small town in Montana. “First, you need to overcome fear of outsiders. People in rural communities are somewhat fearful of those coming in to ’help’ them, no matter what the help is. Making sure to live up to promises is really critical.”
Still remembers in the mid to late ‘80s in rural Montana, when corporate farm companies said “sell us your land and you can still work it,” which was not the case. Many family farms went under and got bought up.
A farm league has to be mutually beneficial. It needs to develop talent for the companies clustered in cities, as well as help grow local economies. Sweet says urban tech companies need to connect in a meaningful way with rural areas. “Progressiveness needs to be inspired across the community,” he says. It would help tremendously if companies used their resources to engage in the community.
Two challenges Kleinsasser sees are limited networking opportunities and entry-level remote situations. He notes that he began full-time remote work after 10 years of experience.
For companies, a farm league means more water in the pond, more talent to choose from, and a stable balance of supply and demand. For small towns it means access to good-paying jobs, and a way to build their economy.
Is a farm league possible? Sure. It takes collaboration, trust, education and responsibility.
The journey starts with that first step of working remote, starting a discussion, starting a remote workers program and even incentives to help build up rural communities. It starts with leadership on both sides to stand up and take the initiative to make something happen.
It worked for baseball, it might work for tech.