Tucked into downtown Minneapolis, a unique entrepreneurship resource seems hidden in plain sight.
On the third floor of the Schulze School of Entrepreneurship at the University of St. Thomas, a collection of desks and conference areas might seem like just another busy student space, but it's actually home to a distinctive incubator program that's currently helping eight new companies find their footing.
St. Thomas was one of the first schools in the country to launch an entrepreneurship program nearly 20 years ago, and the university has provided significant startup funding help to numerous area companies through its investment mechanism. The incubator program is one more step in establishing the university's deep commitment to new businesses, notes Michael Moore, director of the school's funding vehicle, the William C. Norris Institute.
"All St. Thomas graduates or students have the opportunity to apply to the incubator program," he says. "Incubators have proven to be so valuable when it comes to tapping into a pool of experienced advisers and getting attention from advisers."
A camaraderie boost
One of the most important aspects of the incubator program goes beyond the 24/7 access to office equipment; it's the conversations that happen among the startups sharing the space, believes Solome Tibebu, founder of Cognific, a developer of interactive web tools that make psychotherapy and other patient-provider interactions more effective.
"This is a co-working space where you can bounce ideas off each other, and talk honestly about the challenges of starting a company," she says. "Having other people around you who are going through the same process is very meaningful."
Many times, those who've "graduated out" of the incubator stop back into the offices to offer insight and resources. Tibebu says that sometimes on a weekend or evening, the third-floor offices are only lights on in the building, because it's tough to leave such an energetic environment.
"It's so nice to have other people going through what you're going through," says Martha McCarthy, co-founder of The Social Lights, a digital marketing firm specializing in strategies that appeal to millennials.
Even the building's location is a boon for business, she adds, since listing the address gives credibility. "People can see that we're right in downtown Minneapolis, and I think that makes them see us as more established."
A sense of support
In addition to having each other, the incubator companies get access to the university's professors, who are always eager to help with advice on business strategy, hiring, legal issues, and operations considerations.
"These are professors that we've had in classes, so we know them, and in the incubator environment, they begin to turn into colleagues," says Dejen Tesfagiorigis, founder of Dejen Digital, a startup focusing on streamlining the process of admissions for arts programs and camps, with an app called ArtsApp. "We can ask them about product launches or pricing, and get really insightful advice."
The proximity of those resources shouldn't be underestimated, adds BreAnna Fisher, developer of DoDrinks, an application that allows users to "send a drink" to a colleague or friend. She notes that having the ability to walk down the hall or just across campus means that business questions get answered quickly, keeping a business on the fast track. "Without the incubator, I'm not sure I'd know whom to approach for issues like hiring," she says. "But here, it's just an email or a short walk away."
Many of the incubator entrepreneurs are already paying back the benefits they've received by acting as mentors to students in the university's entrepreneurship program, and as judges in entrepreneur contests.
"What's happening is that different generations of entrepreneurs are all helping each other," says Tesfagiorigis. "That's a good experience for everyone."
Financial backing
Another vital component to a startup's success is, quite frankly, cold hard cash. Without an infusion from investors, or access to another capital source, many entrepreneurs struggle with growing a business. Even with free office space and expert advisers, a company will always be in trouble if the money runs out.
For incubator companies at St. Thomas, a significant source of financial support has been the Norris Institute, a seed fund focusing on commercialization of technology-based companies. Incubator businesses don't automatically get funded, but many, like Dejen Digital and Cognific, have already received a startup round.
There are over 20 companies founded by St. Thomas students or alumni in the Norris Institute's portfolio, and those include some familiar names in the Twin Cities, like Recon Robotics, Naiku, and Seeonic. The funding mechanism is an important part of a thriving entrepreneurial culture in the area, believes Adisack Nhouyvanisvong, Naiku's president.
"With the investment we received from Norris, we were able to go ahead with some necessary product development that helped the company grow," he says. "Also, because of that investment, other investors noticed us. St. Thomas is a recognized brand, and because of them, we boosted our own brand recognition."
For Cognific, the investment combined with the incubator support allowed the company to reach a robust starting point, and sign on its first large client, PrairieCare.
"We're growing the team now and moving forward," says Tibebu, who adds with a laugh: "Even with growth, though, the incubator is such a cool place that I'll probably try to say until they kick me out."
This article is reprinted in partnership with The Line, an online chronicle of Twin Cities creativity in entrepreneurship, culture, retail, placemaking, the arts, and other elements of the new creative economy. Elizabeth Millard is innovation and jobs editor of The Line.