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Minnesota Sweetens Lure to Biotech Start-ups

05/11/2010

Bucky Badger

Goldie

Minnesota and its eastern neighbor, Wisconsin, have long-standing rivalries in sports – U of MN Gophers vs. U W Badgers, Twins vs. Brewers, and when Brett Favre joined the Vikings in 2009 after 16 years with the Packers – the flames on that rivalry fire got fanned considerably.

There’s another rivalry that’s just getting going. According to Wendy Lee of the Minneapolis StarTribune, “In the race for venture capital, Minnesota has earned more than Wisconsin in recent years, but analysts have warned that Minnesota is too reliant on one industry – medical devices – for its funding.”  For example from 2004 to 2009 Minnesota earned  a total $1.6 billion in venture capital money while Wisconsin earned $295.2 million. During the same period Wisconsin received $98.5 million VC funding for human biotech businesses while Minnesota earned a barely there $1 million in the same sector.

Minnesota is offering a 25% tax credit for investments in start-ups and emerging businesses to private investors and funds. I wrote about this important legislation in “Minnesota Gives Angels New Wings” first on April 19th.

In business and life – timing is essential. In Minnesota timing is right for entrepreneurs. Especially those in biotech and bio-sciences.

Unfortunately the odds are against the entrepreneur. How about this factoid? According the Center for Venture Research 98% of entrepreneurs fail to find funding and Angel Investors only fund 14% of the businesses they investigate.

Why is getting funding so difficult? Most entrepreneurs…

  • seek the wrong type of capital
  • don’t meet the specific requirements for that capital
  • have an inferior business plan, pro-forma financial statements, pitch, and investor contacts

If you are looking to raise investor money do your homework first. Get help, coaching, networking from every available source. Consider connecting with FundingUniverse. FundingUniverse matches qualified entrepreneurs with active banks, investors, and other funding sources across the United States.  As an aspiring branding guy I love this statement “We provide services that make an entrepreneur Investor or Bank-ready”. Show me an entrepreneur that doesn’t need that!

Get going Minnesotan’s! It’s time for bragging rights with Wisconsin on another front.

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