Minnesota is nationally known as a center for the medical device industry, but we’ve never had much of a reputation as a headquarters for technology companies. That’s changing. Aspiring entrepreneurs can now tap into an extensive ecosystem to help get them off the ground.
“I think tech is definitely taking over—you’re just starting to see the infiltration of tech into basically everything,” says Ryan Broshar, founder and managing partner of Minneapolis-based Matchstick Ventures, which makes seed-stage investments in regional tech companies. “There are startups servicing the retail industry, the ag industry, the health care industry … I think the local startup ecosystem now is more coordinated than it’s ever been.”
Local tech news website TECHdotMN estimates there are approximately 200 early-stage tech startups in Minnesota.
Matchstick has invested locally in Branch, a mobile service for scheduling hourly workers, and Inspectorio, which makes inspection software for retailers to help track supply chains. Both relocated to Minneapolis after participating in the Target Techstars incubator program, and both are drawing investors. Branch secured $10 million in financing in 2017; Inspectorio landed a $10 million Series A round of funding in 2018. Broshar was founder and managing director of the Techstars Retail Accelerator project with Target and served as managing director until December.
“We do see growth,” says Margaret Anderson Kelliher, who served as president and CEO of the Minnesota High Tech Association from 2010 to the end of 2018. “We really see this whole area of artificial intelligence, as well as data analytics, being big growth areas in Minnesota. We also see that there are new areas that are developing as well in food and agriculture.”
Kelliher notes that the national Cyberstates survey reported that there are 9,500 tech businesses here.
“We’re at the center of the universe for digital health,” says Scott Nelson, vice president of product for Minnetonka-based Digi International Inc., a publicly traded company that sells tech hardware and services.
Nelson notes that Midwestern investors, unlike those in Silicon Valley, aren’t looking for “unicorns” and are more patient, giving companies time to build businesses.
“I think both digital health and the ‘Internet of things,’ they’re much more compatible with Midwestern investor profiles,” Nelson says. “Midwestern money is very conservative compared to West Coast money.”
Some young companies are drawing national notice. Minneapolis-based OneOme landed a spot on Fast Company’s 2018 edition of the World’s Most Innovative Companies for its RightMed software, which can be used in conjunction with a DNA test to avoid or minimize adverse drug reactions in patients. Minneapolis-based HabitAware landed on Time’s 2018 Best Inventions list for its Keen smart bracelet, which helps people break unwanted behaviors such as hair pulling or nail biting.
Twin Cities Business rounded up some of the best new and emerging technologies from Minnesota companies. Our list is by no means a complete guide to all of the coolest local technology (we only have so much space) but we tried to zero in on innovations that can make a real difference in people’s lives.
Cleaner air for biopharma manufacturers
How does 3M create so many new products? The company spends big—5.8 percent of its sales—on research and development. For 2017, that translated into more than $1.8 billion. One result from 3M’s Life Sciences Process Technologies business unit: The new Emphaze AEX Hybrid Purifier. In basic terms, it’s an air purifier. But it’s really a health care tool, combining several 3M proprietary technologies to create a product that can streamline the production of and significantly reduce impurities for therapeutic proteins. Emphaze won a prestigious Frost & Sullivan 2017 Global Product Leadership Award. It was also named a 2018 Minnesota Tekne Award winner in the biotechnology/biopharmaceutical category.
3M won the 2018 Tekne Award in the biotechnology/biopharmaceutical category.
Machine learning meets agriculture
2019 will be something of a culmination year for Sentera, says CEO Eric Taipale. Farmers using the five-year-old Minneapolis startup’s drones and sensors to map weeds and monitor the health of their crops will no longer have to interpret raw field data and color-coded aerial maps. Instead, machine learning will simplify the process into easy-to-read reports. And with the addition of some sensor and software tune-ups, new high-precision features will become possible, including the automatic counting and lifetime monitoring of individual crops. “We’re also pushing things into real time,” Taipale says, “whereas last year you would’ve had to wait hours or days to get results.” With the addition of roughly a half-dozen new machine learning or AI-based analytics products in 2019 from Sentera, farmers and agriculture researchers will also be able to monitor a wider range of crops—mostly fruits, vegetables, and a variety of permanent crops—beyond the corn and soybeans that the drones and sensors had only been optimized to survey.
Improving water purity
Many of us have heard about Legionnaires’ disease, but few probably understand how just about everyone could be at risk for contracting the potentially life-threatening, severe form of pneumonia. The disease is caused by inhaling the Legionella bacteria through mist in the air. While Legionella is found naturally in fresh water, it can contaminate water-based systems in buildings such as air conditioners, hot water tanks, and cooling towers. Ecolab’s new Quantitative Polymerase Chain Reaction (qPCR) can test water samples within 24 hours—a big leap from the 14 days of traditional methods. Ecolab calls the technology “a game-changer in the detection and management of Legionella risks.” After just a few months on the market, Ecolab is hearing positive feedback from operators of hotels, hospitals, and commercial buildings who are deploying the new technology, which was a Tekne Award finalist in the emerging technologies category for large companies.
Personal Information app for emergency responders
It’s in the name: The Vitals app—led by serial entrepreneur Steve Mase and former Minneapolis police chief Janeé Harteau—was built to provide vital information to law enforcement, first responders, and others interacting with people living with behavioral, mental health, physical, and developmental conditions. Founded through a partnership with the Autism Society of Minnesota, the company’s technology communicates general information—age, height, weight, medical conditions, a photo—to those en route to an affected individual. It also provides first responders with tips, such as behavior triggers and de-escalation techniques. Vitals intends to use 2019 to increase adoption of its app nationwide.
A first-of-its-kind wearable device for diabetes patients
Medtronic secured FDA approval in September 2016 for its MiniMed 670G system, effectively an artificial pancreas for diabetes patients—a first-of-its-kind innovation. The wearable device measures the patient’s glucose levels. The MiniMed 670G eliminates the need for Type 1 diabetes patients to inject insulin. Launched for sale in the U.S. in 2017, the wearable device constantly measures the patient’s blood sugar and administers insulin. The company disclosed on a November 2018 earnings call that more than 125,000 patients are already using the product. Patients using the MiniMed 670G have been found to be in the “optimal glycemic range” more than 70 percent of the time.
125,000 patients already use Medtronic's MiniMed 670G.
Mouth guard that monitors head injuries
After years of studies and product development, Edina-based Prevent Biometrics’ head-impact-monitoring mouth guard is about to reach the commercial market, with initial shipments planned for July. The device—which wirelessly sends impact information to a coach’s or parent’s phone or computer in real time—aims to promote safety in contact sports, while also helping diagnose potential concussions or other injuries. The version due out this summer has been vastly improved over the company’s early prototypes: It’s 40 percent smaller, more able to withstand wear-and-tear like chewing, and capable of doing the one thing head-impact-monitoring devices have largely failed to do—consistently differentiate heavy hits from minor movements and even acoustics, such as yelling. A special case is required with every mouth guard. The case, purchased separately, doubles as a charging station and also sanitizes the guards after every use with a bath of UV light.
Prevent Biometrics is selling its mouth guard for $99; cases are $29 for individuals, $299 for a team of up to 27 athletes.
AI-powered hearing aid
Starkey Hearing Technologies’ new Livio AI hearing aid is chock-full of industry firsts. Similar to most fitness wearables, Livio AI has built-in 3D motion sensors that can count steps and monitor physical activity. Apple Health and Google Fit apps can be paired with it to keep activity data in one place. Hardware improvements to the device also make it easier for its users to hold conversations in noisy environments. But what puts it on the cutting edge is its new Hearing Reality technology, which can improve listening and speech clarity—in 27 languages. Livio AI can translate foreign languages as the user hears them. And when Livio AI users are home, they can even connect the hearing aid to certain TVs, pair it with Amazon Alexa, or use it to stream phone calls and a variety of media. As Starkey president Brandon Sawalich says, “We have transformed a single-use device into the world’s first multipurpose hearing aid.”
Micro-organs for medical research
Since winning the MN Cup in 2016, StemoniX has widened the portfolio of human-based micro-organs it sells to pharmaceutical companies and hopes to see expanded use this year for toxicology testing and drug discovery. The Maple Grove startup takes adult stem cells and transforms them into tiny organisms that resemble brain or heart tissue. These micro-organs are essentially alive, and because the samples are human-based, StemoniX believes their product is better for clinical trials than animal testing is. Currently, the company is using what it has learned from two of its first products, microHeart and microBrain, to prepare new cell-based platforms that could launch as soon as this year, says Ryan Gordon, StemoniX’s vice president of business development and commercialization.
StemoniX took home back-to-back CONNECT Awards for Most Innovative New Product in the field of life science research tools and medical devices in 2017 and 2018.
Bracelet that helps people kick bad habits
After its blockbuster year winning the MN Cup and watching its flagship product, the Keen bracelet, earn a spot on Time magazine’s annual Best Inventions list, HabitAware is using 2019 to fine-tune and potentially expand Keen’s capabilities. With grant money from the National Institute of Mental Health, the Minneapolis startup is planning a series of updates to “optimize” its wrist device, which is designed to help people break habits like nail biting and hair pulling. The advancements HabitAware makes this year could lead to something new, says CEO Sameer Kumar. “There’s no reason that the behaviors [Keen helps tackle] have to be limited to this relatively niche-y market,” he says. “We don’t expect the current platform to be our only product forever.”
Making electronic health records accessible
Minnesota is a growing hub for health care technology and digital health. Minneapolis-based Sansoro Health Inc. is tackling one of health care’s biggest challenges: accessing electronic health records from different systems. Sansoro’s technology is designed to allow seamless data transfer of electronic health records and third-party applications. Investors are taking note. In August, Sansoro announced $8 million in Series B financing; the company has now raised a total of $14.5 million. Sansoro is one of many local companies building on Minnesota’s strength in the health care industry to offer new technology in the expanding realm of digital health.
Sansoro Health was named a 2017 Startup to Watch by Healthcare IT News.
AI-powered temperature control systems
Since launching its “building intelligence in a box” system, 75F has been smartening its temperature-control technology through machine learning and artificial intelligence. The Burnsville-based business is actively testing new energy-saving capabilities that monitor a facility’s hot and cold spots, the weather outside, and more. Over three months of testing the improvements in two Minnesota HOM Furniture locations, the system decreased each of the 150,000-plus-square-foot stores’ energy usage by an average of 33 percent, CEO Deepinder Singh says. In certain cases, the system can cut heating and cooling costs by as much as half. Singh says 75F is also using developing AI-powered predictive equipment-failure features, which will automatically dispatch technicians and make proactive service adjustments if a building control unit fails.
75F was a finalist in the Building Design and Infrastructure category of the Minnesota High Tech Association’s 2017 Tekne Awards.
With the capabilities out there today to make almost any mechanical object “smart,” one Osseo company is giving auto enthusiasts the wheel to modernize and customize both old and new vehicles. Macchina, founded by cousins Earl and Josh Sharpe, has over the last several years been refining its M2 device, which connects to a car’s engine and sends code back to the user’s computer. That code can then be manipulated to give users the power to start the engine and unlock car doors using a smartphone, or have a vehicle automatically pull in its wing mirrors when entering tight corridors. 2019 will mark the official expansion of Macchina’s product line. “Macchina aims to develop a family of car-hacking products, and M2 sought the middle ground (M for middle) in terms of hardware capability and versatility,” says a company spokesperson. This year, Macchina will launch a smaller, less expensive model called the A0, as well as a high-end option with a faster processor known as the P1.
Anti-piracy music app
For more than a decade, musicians and record labels have used Minneapolis-based Haulix to safely share audio files with its unique watermarking capability. Customer convenience will get a major upgrade this spring in the form of Haulix’s first-ever smartphone app—a rarity among its competitors. “We believe that by having an app we’ll raise engagement across the board, because in order to keep people engaged you need to adapt to their changing lifestyle,” says James Shotwell, the director of customer engagement at Haulix. Keeping with that trend, Haulix is also introducing a new email scheduling tool that boasts a customizable, embeddable media player so bands can more conveniently push their music out to influencers.
The watermark Haulix places on shared tracks is virtually unrecognizable to the human ear. This “invisible fingerprint” can be traced back to the original downloader in cases when a track is leaked.
Predictive supply chain software
Eden Prairie-based C.H. Robinson Worldwide Inc. is one of the global leaders in third-party logistics. But a leader only remains a leader through innovation. In September 2017, C.H. Robinson unveiled Navisphere Vision, a next-generation software as a service (SaaS) platform to visualize, track, and manage companies’ supply chain—transporting goods around the world. Deploying predictive analytics, Navisphere Vision lets users track in real time events, such as weather and traffic, that could disrupt their supply chain. Global companies are now using Navisphere Vision for “supply chain visibility” in more than 150 countries.
Lab pigs and cooler cows
Recombinetics has made major strides in the field of gene editing, perhaps most famously in its attempt to end the painful process of dehorning dairy cattle by creating hornless cows. More livestock innovation is on tap this year at the St. Paul-based company, with new solutions coming from its biomedical division, Surrogen, as well as its food animal, aquaculture, and agriculture arm, Acceligen. Through Surrogen, the company will market two new types of gene-edited pigs. The YorkaPig-HF-RBM 20 Domestic Pig, co-developed by Mayo Clinic, is a first-of-its-kind living, breathing lab animal replicating an incurable cause of heart failure known as dilated cardiomyopathy, or DCM. Recombinetics is anticipating FDA approval of the use of the Yorka in therapeutic studies. Separately, its new OssaPig-NF-NF1 Miniature Pig is designed for studies on neurofibromatosis, or NF1, a genetic disorder that causes skeletal abnormalities, scoliosis, blindness, and other human complications. Under Acceligen, the company will be launching a product for cattle specifically. Called Naturally Cool, the new breeding solution is intended to reduce heat stress in elite cattle breeds living in tropical and subtropical zones, while also reducing environmental impact, as farmers will be able to produce more locally grown dairy and beef with fewer animals.
On the back a $19 million funding round last fall, Evolve Additive Solutions is dropping both its alpha (early 2019) and beta (late 2019) additive manufacturing machines this year. The equipment features cutting-edge STEP technology (short for Selective Thermoplastic Electrophotographic Process) and is poised to save manufacturers millions of dollars with faster, more efficient production, says Bruce Bradshaw, chief business and marketing officer for Minnetonka-based Evolve, which spun out of Stratasys. Evolve’s STEP machines are designed for large product runs in industrial markets, such as the automotive, consumer goods, and medical devices markets. Not only do STEP machines effectively eliminate the need for expensive molds, Bradshaw says, they also give manufacturers more flexibility to tweak as they go and fulfill specialized orders in-house.
Evolve’s big-name investors include LEGO, Black + Decker, and Stratasys. It also counts Kodak as one of its partners.
Alternative payment platform
When it started in 2016, Minneapolis-based Sezzle Inc.’s original concept offered rewards for debit card users, but the model didn’t find much traction. The fintech startup pivoted with a new concept: Customers using Sezzle for purchases can pay for their items in four interest-free installments over six weeks. Sezzle is aimed at younger shoppers or others who don’t have credit. Customers are charged fees if they miss payments, but the core of Sezzle’s revenue is a transaction fee from retailers. The new plan is clearly working. After raising $8 million in financing earlier in 2018, Sezzle landed a $100 million line of credit in November. The firm’s advisory board includes former executives of PayPal and Airbnb.
Digital lending for small business owners
The market is awash with new financial technology—“fintech” in industry shorthand—and a range of companies are offering nearly instantaneous loans. Small business owners are sometimes frustrated with how long it takes large banks to make credit decisions, but many are wary of dealing with new companies with no track record. In September, Minneapolis-based U.S. Bancorp rolled out its own proprietary, all-digital platform for small business loans or lines of credit up to $250,000. With the streamlined process, 69 percent of qualified applications are approved in a day or less. But it’s still a relationship business: The platform also offers a tool to set up an in-person meeting with a banker.
“Skip-the-line” mobile technology for stores
Target Corp. has weathered the retail storm and emerged as a brick-and-mortar survivor. But it hasn’t done so without making numerous tech upgrades to improve the in-store shopping experience. In 2017, the company rolled out technology so staffers can place Target.com orders for customers, which will be shipped to their doors. This holiday season, Target expanded that feature with its rollout of “skip-the-line” mobile technology that it developed in-house, which allows customers to check out with any staffer in the store. But that’s not all. In 2017, Target started using computer generated imagery (CGI) to offer augmented reality (AR) tools to help shoppers envision how furniture and accessories will look in their homes. The company calls it “360-degree shopping,” which it continues to upgrade and enhance.
Over the holidays, Target introduced its first kids gifting catalog with image recognition technology.
A cryptocurrency data archive
Coming off its most formidable year of trading since the 2014 cryptocurrency crash, the crypto market and its investors need more than ever the best possible data to make informed buying decisions. That’s why Nomics, a Minneapolis- and Boston-based startup led by Leadpages founder Clay Collins, is building what it calls the “Yahoo Finance of cryptocurrency,” which offers dashboard data for enthusiasts as well as raw, deep-dive information for hedge funds and others in the fintech space. Following its $3 million Series A fundraising round in the final days of 2018, the startup will be putting that cash into action this year to acquire nearly 100 percent of all crypto trading data, effectively making it the go-to source for this vital information. Meanwhile, Nomics is building new tools that none of its competitors now offer, such as the ability to compare analytics of individual trading pairs, such as Bitcoin to other cryptoassets or government currencies, including the U.S. dollar.