< Previous46 MI NNE SO T A E C O N O MI C D E V E L O P ME N T G U I D Emake them more accurately refl ect what’s in a human. It’s making for a more predictive model — something that reacts to therapeutics in a more accurate way. In our short existence,” says Yeh, “we’ve come to support some of the largest pharma companies in the world.”Yeh acknowledges that his startup’s early success has not occurred in a vacuum. “We received funding from the Minnesota Angel Tax Credit. Angels got 25 percent of their investment credited back to them, and those investors could be anywhere in the country. Many have poured the credits back into the companies they supported. We also received an investment loan from the state. “Medical Alley, which is one of the largest trade organizations for medical-related companies, is here, and they were very helpful, too.”StemoniX also received an $80,000 boost by claiming the grand prize and division award in the 2016 Minnesota Cup. MN Cup, as it’s known, is the largest startup business competition in the country, offering $500,000 in annual prize money. Nearly 15,000 Minnesotans have participated in the competition since it began in 2005. The 2017 grand prize winner, MicroOptx, which designed a tiny implantable device to treat glaucoma, raised $1.4 million less than a month after winning the competition.Minnesota companies received $1.3 billion in venture capital investments through 120 deals between 2015 and 2017, according to fi gures from the National Venture Capital Association. According to a recent report by the Star Tribune, 48 early-stage companies in Minnesota received $495.1 million in venture capital last year, up 41 percent from 2016; in comparison, venture funding nationally increased just 17 percent last year. The Minnesota Venture Capital Association has about 30 member fi rms, including Matchstick Ventures, Split Rock Partners, Lehmi Ventures and StarTec Investments.Minnesota, which leads the nation in medical device patents per capita, isn’t resting on its laurels. In 2018, the Minnesota Department of Employment and Economic Development (DEED) launched a new program called MILE, or Minnesota Innovation Loans for Entrepreneurs. MILE provides interest-free loans ranging from $20,000 to $50,000 to early stage businesses that are developing high-tech products or services in Minnesota.Minnesota also leads the nation in 5-Year Business Survival, according to the Bureau of Labor Statistics (2012-2017). The state is focused on helping businesses get started and succeed. DEED has a Small Business Assistance Offi ce that provides help on starting a business — and also oversees Small Business Development Centers throughout the state that offer free confi dential consulting to entrepreneurs. Clients can get advice on capital and loan packaging, accounting systems and literacy, marketing and research, marketing plan development, startup assistance, business plan development, succession and strategic planning.“I’m quite pleased with the energy that the Minnesota ecosystem is producing.”— Ping Yeh, Founder & CEO, StemoniXMI NNE SO T A E C O N O MI C D E V E L O P ME N T G U I D E 47The centers also offer workshops and classes year-round throughout the state, including sessions on tax-saving and record-keeping tips, entrepreneurial essentials, using social media to promote a business, and the basics of starting a business.StemoniX, which has an R&D outpost in San Diego, is committed to its Minnesota roots.“We’re in the upper northwest part of the Twin Cities, in a town called Maple Grove,” says Yeh. “It has tons of amenities from restaurants to parks to shopping. Medtronic and Boston Scientific are just a couple of the many large anchor corporations just a few minutes away. They help establish a strong community foundation. “It’s also beautiful here. Lakes and ponds are scattered all around us, and nice affordable homes are great options for our new hires. It’s great to have those options for our people.” I N T ER NA T I O NAL T R AD E AN D I NVE S T M EN T48 MI NNE SO T A E C O N O MI C D E V E L O P ME N T G U I D EMI NNE SO T A E C O N O MI C D E V E L O P ME N T G U I D E 49ost states reported increased export growth in the second quarter of 2018, but Minnesota logged the 11th largest gain in the nation that quarter. At 15 percent growth and a record $5.9 billion in exports, the North Star State outpaced the national export growth rate of 11 percent. “Minnesota businesses made an additional $780 million in export sales between the second quarters of 2017 and 2018,” said Commissioner Shawntera Hardy, Minnesota Department of Employment and Economic Development (DEED). “Our state continues to have a robust international customer base and investment opportunities.”by M AR K AR EN DMNorth Star Exports to World Markets Soar in 2018North Star Exports to World Markets Soar in 201850 MI NNE SO T A E C O N O MI C D E V E L O P ME N T G U I D E$0M$5,000MExports (Millions)-50%0%50%100%Percent Change from Previous YearTotalOptics, MedicalMachineryElectrical MachineryPlasticsVehiclesOres, Slag And AshFood By-ProductsPharmaceuticalsAircraft, SpacecraftMeatOther$5,945M$1,140M$918M$818M$400M$342M$192M$167M$158M$145M$103M$1,561M15%23%13%24%23%1%52%40%89%-31%10%6%$0M$2,000M$4,000M$6,000MExports (Millions)-20% -10%0%10%20%30% 40%Percent Change From Previous YearWorldCanada (1)China (2)Mexico (3)Japan (4)Korea (5)Germany (6)Singapore (7)U.K. (8)Netherlands (9)Belgium (10)Other$5,945M$1,322M$717M$613M$390M$262M$246M$169M$169M$154M$152M$1,750M15%20%27%5%24%21%30%19%4%-18%-8%14%Exports and Trends for Minnesota’s Top 10 Markets, 2018-Q2Exports and Trends for Minnesota’s Top 10 Products to World, 2018-Q2$0M$5,000MExports (Millions)-50%0%50%100%Percent Change from Previous YearTotalOptics, MedicalMachineryElectrical MachineryPlasticsVehiclesOres, Slag And AshFood By-ProductsPharmaceuticalsAircraft, SpacecraftMeatOther$5,945M$1,140M$918M$818M$400M$342M$192M$167M$158M$145M$103M$1,561M15%23%13%24%23%1%52%40%89%-31%10%6%$0M$2,000M$4,000M$6,000MExports (Millions)-20% -10%0%10%20%30% 40%Percent Change From Previous YearWorldCanada (1)China (2)Mexico (3)Japan (4)Korea (5)Germany (6)Singapore (7)U.K. (8)Netherlands (9)Belgium (10)Other$5,945M$1,322M$717M$613M$390M$262M$246M$169M$169M$154M$152M$1,750M15%20%27%5%24%21%30%19%4%-18%-8%14%Exports and Trends for Minnesota’s Top 10 Markets, 2018-Q2Exports and Trends for Minnesota’s Top 10 Products to World, 2018-Q2Source: Harmonized Tariff Schedule, Origin of Movement Export Series, Census Bureau, U.S. Department of Commerce. In June 2018, the Minnesota Trade O ce, part of the Minnesota Department of Employment and Economic Development (DEED), announced the opening of new international representative o ces in Canada, Mexico, Japan, the European Union, the United Kingdom, Australia and the ASEAN region (Indonesia, Thailand, Vietnam, Singapore, Malaysia, Philippines, Myanmar, Cambodia, Laos, and Brunei).These o ces are in addition to previously established overseas o ces in Brazil, Germany, and China. Their role is to provide export promotion and assistance to Minnesota companies selling goods and services globally, and work to attract foreign investment from companies looking to do business in Minnesota.“We are listening to what Minnesota businesses and global markets are telling us,” said Gabrielle Gerbaud, executive director of the Minnesota Trade O ce. “It is important to be prepared and have international representation to best serve the interests of our small- and medium-sized business and to continue positioning Minnesota for future growth.”The seven international representatives are comprised of either private contractors or consulting fi rms with knowledge in international trade and foreign direct investment. Contracts were awarded through a competitive process. In 2017, Minnesota exported $21 billion of goods to more than 200 di erent countries. Canada, Mexico, Asia and the European Union are Minnesota’s largest export markets.Exporting supports about 118,000 jobs in Minnesota, and foreign-owned enterprises operating in Minnesota support about 120,800 jobs.Minnesota Plants Its Flag in Seven Global MarketsMI NNE SO T A E C O N O MI C D E V E L O P ME N T G U I D E 51Asia was the state’s top export region, with sales climbing 23 percent to $2.1 billion. Minnesota exports grew 15 percent to $1.9 billion in North America and 9 percent to $1.3 billion in Europe. Exports sales also climbed in Central and South America (up 8 percent) and the Middle East (up 25 percent) but dropped in Africa (down 9 percent) and in the Australia-Pacifi c area (down 9 percent).Minnesota’s top national market was Canada, with sales climbing 20 percent from a year ago to $1.3 billion. Other top 10 markets were China ($717 million, up 27 percent), Mexico ($613 million, up 5 percent), Japan ($390 million, up 24 percent), South Korea ($262 million, up 21 percent), Germany ($246 million, up 30 percent), Singapore ($169 million, up 19 percent), United Kingdom ($169 million, up 4 percent), Netherlands ($154 million, down 18 percent), and Belgium ($152 million, down 8 percent).Optics/medical was the top-selling product category at $1.14 billion in sales, an increase of 23 percent from the second quarter one year ago. Other top 10 exports were machinery ($918 million, up 13 percent), electrical machinery ($818 million, up 24 percent), plastics ($400 million, up 23 percent), vehicles ($342 million, up 1 percent), ores/slag/ash ($192 million, up 52 percent), food by-products ($167 million, up 40 percent), pharmaceuticals ($158 million, up 89 percent), aircraft/spacecraft ($145 million, down 31 percent), and meat ($103 million, up 19 percent).Investing in MinnesotaMore than 900 foreign-owned companies have operations in Minnesota. Combined, they employ about 120,800 people and have invested more than $25 billion in plant, property and equipment in Minnesota. Medical device fi rm Caisson Interventional LLC, for example, is expanding its Maple Grove facilities by 30,000 square feet and is adding 50 jobs. The company, which is owned by UK-based LivaNova PLC, said it will invest $750,000 in the building expansion. DEED is supporting the project with a $359,850 grant from the Job Creation Fund. The company will receive the funding once it has met investment and hiring commitments. Caisson is developing a minimally invasive implantable heart valve system that has the potential to benefi t millions of patients worldwide. “The company’s investment in jobs and facilities is helping to grow a medical device cluster that is one of the cornerstones of the Minnesota economy,” said DEED Commissioner Shawntera Hardy. “Our state continues to have a robust international customer base and investment opportunities.”— Shawntera Hardy, Commissioner, Minnesota Department of Employment and Economic Development (DEED)IN F R A S T RU C T U R E52 MI NNE SO T A E C O N O MI C D E V E L O P ME N T G U I D Einnesota — the 12th largest state in size — has the transportation network it needs to get people and goods from Point A to Point B efficiently. It ranks a solid sixth-best in infrastructure (CNBC and U.S. News & World Report, 2018). And the improvements keep coming.“One of Minnesota’s strongest assets when it comes to economic development is its infrastructure,” says Charlie Zelle, Commissioner of the Minnesota Department of Transportation.Minneapolis-St. Paul International Airport (MSP) is the crown jewel by G AR Y D A U G H T ER S M ###IMAGE: INFRASTRUCTURE MAPNO CAPTIONSource: Minnesota Dept. of Employment and Economic DevelopmentPHOTO (BRIDGE)Caption: The new Hwy. 53 bridge over the Rouchleau iron pit required 50,000 tons of steel.Source: Minnesota Department of Transportation MI NNE SO T A E C O N O MI C D E V E L O P ME N T G U I D E 53of Minnesota’s transportation network. To keep up with growing passenger volume, the airport is undergoing a $1.6 billion renovation. Betterments include:• A new parking ramp with 5,000 additional spots.• Expanded food court to include national chains and local fare. • Aesthetic upgrades to baggage claim and ticketing.• A 300-room Intercontinental hotel with a rooftop bar for viewing takeoffs and landings.MSP generates an estimated $7.1 billion a year for the Minnesota economy and supports 21,200 jobs. In 2017, a record year of 38 million passengers, MSP was named Best Airport in North America (25-40 million passengers category) for the second straight year by Airports Council International.Minnesota has nine airports with commercial airline service, from Rochester in the south to International Falls in the north. Another three airports located close to the border in neighboring states are used by businesses and residents in those areas. The North Star State has three major interstate highways — I-35, I-94 and I-90. Nearly 400 million tons of freight are transported annually on Minnesota roads. In its 2018 infrastructure ranking, CNBC noted 54 MI NNE SO T A E C O N O MI C D E V E L O P ME N T G U I D Ethat the state’s bridges are “among the best in the nation.”In late 2017, the Minnesota Department of Transportation completed work on a mammoth, $240-million project to re-route State Highway 53 north of Duluth. The project yielded a breathtaking 1,100-foot-long vehicle bridge some 200 feet above the Rouchleau iron pit. The new bridge, the state’s tallest, required 50,000 tons of steel and took two years to complete.For 2018, the state invested $1.1 billion in funding for 253 road and bridge projects, plus 49 multi-modal transportation projects valued at $32 million. “These projects,” says Commissioner Zelle, “are critical investments in Minnesota’s transportation system.” Zelle says the state is repaving roads, repairing bridges, replacing culverts and rehabilitating other aging structures.When it comes to rail, the state has nearly 4,500 miles of freight railroad operated by 21 companies. Four Class I freight rail lines are integrated with the U.S. and Canadian railway systems.Minnesota’s commercial ports Source: Minnesota Dept. of Employment and Economic DevelopmentMI NNE SO T A E C O N O MI C D E V E L O P ME N T G U I D E 55located on Lake Superior and the Mississippi River connect businesses to markets across the country and around the world. The state’s Lake Superior ports alone generate $1.3 billion for the state’s economy and support more than 6,200 jobs.Four ports on Lake Superior transport an average of over 50 million net tons of freight per year. The Mississippi River System, which spans 222 miles, includes five port areas and transports an average of over 13 million net tons of freight per year.Located at the western end of Great Lakes St. Lawrence Seaway System, the Port of the Duluth is the farthest-inland freshwater seaport and one of the leading bulk cargo ports in all of North America. The port handles an average of 35 million short tons of cargo and nearly 900 vessel visits each year.In 2018, the Duluth Seaway Port Authority received $2.3 million from the Minnesota Department of Transportation for a new expansion. The project will provide for additional mooring and storage area at the facility, allow for dredging to full seaway depth, and will also help support the recently opened Duluth Intermodal Terminal. A partnership between Canadian National Railway Company and Duluth Cargo Connect, the intermodal terminal positions the region for direct transportation of containerized imports to the East and West Coasts and the Gulf of Mexico. The new Hwy. 53 bridge over the Rouchleau iron pit required 50,000 tons of steel.Photo courtesy of Minnesota Department of TransportationNext >