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Microbiologics lab / Paul Vincent

Minnesota Supports Businesses

Minnesota ranks first in the nation in five-year business survival rate (Source: MN DEED). That's because the state complements investments with collaborative networks to support innovative startups and bold entrepreneurs. 

With the highest venture capital investment per capita in the Midwest (Source: National Venture Capital Association 2024 Yearbook) and a robust offering of resources and incentives, Minnesota businesses don’t just sprout — they flourish.

MINNESOTA SMALL BUSINESS LANDSCAPE

$1.2+ billion — the amount raised in total venture capital by Minnesota startups across 184 deals in 2023

68,536 — the number of business applications in 2023

14,929 — the number of new employer establishments in 2022

30% — increase in the number of business starts post-pandemic

230 companies — the number of companies founded at the University of Minnesota since 2006

Sources: PitchBook-NVCA Venture Monitor, Business Formation Statistics – U.S. Census, MN DEED, MN DEED, University of Minnesota

MINNESOTA STARTUP SPOTLIGHT: ROCHESTER

Hear from leaders at the Destination Medical Center and Mayo Clinic Business Development in Rochester about why they feel Minnesota is filled with opportunities for founders and why investors should consider the power of startups in Minnesota.

Minnesota’s Startup & Small Business Experts

Minnesota's Office of Small Business and Innovation (MN OSBI) is your partner and resource to start and grow your business. MN OSBI serves startups, small businesses, and organizations that support them across the state by providing education, startup assistance, connections to resources, and access to capital.

Within the MN OSBI, you can access Small Business Assistance, the Small Business Development Centers (SBDC), Community Partnerships, Launch Minnesota and the Child Care Office. Learn more about these organizations in the FAQ section below, or read on to find more resources for your startup journey.

Start Your Small Business: The Checklist

When starting a new business, there are many important decisions to make. Follow the steps below to ensure you’re taking the right steps for your business:

Reach out and get connected to local and state resources to help you prepare to launch your business. Research your competitors, the market, and potential customers. Then write a business plan.
Determine how to organize your business. Here are the types of business structures available in Minnesota.
Confirm your business name and follow these step-by-step instructions for registering your business.
Obtain a state tax ID number from the Minnesota Department of Revenue and federal tax ID number (EIN) from the IRS.
Secure necessary business prerequisites – does your business require licenses and permits? Insurance should be secured to mitigate risks. Also, be sure to protect your intellectual property (via patents, trademarks, copyrights and trade secret protections).

Minnesota’s Office of Small Business and Innovation put together a few additional resources to help founders get started.

Finance Your Small Business

Establishing and expanding small businesses are expensive endeavors. Even the most successful entrepreneurs need help accessing new funding streams. The Minnesota Department of Employment and Economic Development (MN DEED) helps Minnesota's small businesses access millions of dollars annually through grants, loans, and tax credits. MN DEED’s Office of Small Business and Innovation also provides grants to organizations that directly support businesses looking to start and scale. 

Use the following table to find financing opportunities that may be right for you and your business, or click here for a downloadable guide to see a list of funding opportunities available for startups and small businesses from the MN DEED.

Faribault Mill's factory in Southern Minnesota / Paul Vincent

Grow your Small Business

Having a great idea is only the first step toward establishing a small business. Resources across the state are available to help founders and owners grow their companies into thriving small businesses

INCUBATORS & ACCELERATORS

Over two dozen accelerators and incubators help startups across the state, and many of Minnesota’s largest companies are partners in accelerators and other startup programs. For example, Cargill and Ecolab support Techstars Farm to Fork accelerator, and Allianz and Securian Financial partner with gener8tor for the gener8tor Insurance & Wealth Accelerator.

One of the first programs created in Minnesota, the University Enterprise Laboratories, serves as an incubator for early-stage companies in life sciences, biotech, and other science and technology industries. The State of Minnesota is also proud to be named a national Smart Med Tech Hub and is working with Mayo Clinic, Medtronic, Medical Alley, and other private and public partners to host MNcubation, an incubator focused on accelerating smart med tech startups.

CONSULTING, EDUCATION & TECHNICAL ASSISTANCE

No matter where you set up shop, Minnesota boasts a connected and collaborative ecosystem across the state. In addition to hosting SBDCs, Minnesota partners with community organizations to provide founders and small businesses with the right resources at the right time. Explore the following table for resources and organizations that may be relevant for you and your small business:

STARTUP COMPETITIONS & SHOWCASES

Founders can share their ideas at pitch competitions and startup showcases across the state. Two of the most prominent competitions in the state are:

MN Cup, the largest statewide venture competition in the country hosted by the University of Minnesota’s Carlson School of Management
Startup Showcase, an invite-only event for startups across the state to meet and pitch investors in Minnesota and beyond

Mayo Clinic - Minnesota BioBusiness Center — The Minnesota BioBusiness Center at Mayo Clinic / Paul Vincent

Other Small Business & Startup Resources

Small businesses are the foundation of Minnesota's economy, ensuring vibrant main streets and powering economic growth. The State of Minnesota and its partners have numerous resources to help answer your questions and guide you in the right direction.

The MN DEED offers a small business owners meeting on the second Tuesday of every month at 2:00 p.m. It allows owners to talk with business experts and their peers.

In addition, Launch Minnesota has a calendar of partner events and webinars and hosts Welcome Wednesday webinars available for small business owners and founders. While Launch Minnesota is focused on the technology and innovation industries, founders and owners across any industry can find free resources available here.

In 2023, the Minnesota Legislature and Governor’s Office passed a comprehensive bill to legalize adult use of cannabis, making Minnesota the 23rd state in the nation to do so. The new law also created a new state office – the Office of Cannabis Management (OCM) – which is responsible for overseeing the burgeoning cannabis industry in Minnesota.

Please refer to the OCM’s Business Resources and FAQ page for more information about business licensing (not yet available) and the new cannabinoid industry in Minnesota.

Accessible quality child care is critical for not only strong child development but also the economic stability of families and communities. Investing in Minnesota's communities opens doors for families, employers, businesses, and community organizations that need childcare to thrive so their community and economy can thrive.

The Office of Child Care Community Partnerships supports and promotes the expansion of quality child care statewide and accessibility to child care for underserved communities. Minnesota's families deserve equal access to high-quality, affordable child care and early education.

Contact Minnesota’s APEX Accelerator program, which provides technical and marketing assistance to all Minnesota businesses interested in selling their products and services to the government. We provide the necessary tools to be competitive in the contracting arena.

Founded in 1991, the APEX Accelerator is a program available through the Minnesota Department of Administration and is funded in part through a cooperative agreement with the Department of Defense.