Startups bring vibrance to rural areas

RED WING, Minn. — An ambitious headline from an August VentureBeat article read, “In 5 years, the Midwest will have more startups than Silicon Valley.”

The area isn’t exactly known for technological innovation as much as for agriculture, but that’s not to say the drive isn’t there.

Nonprofit organization Red Wing Ignite is helping ambitious entrepreneurs find the resources they need in the Goodhue County town.

“We provide a link to mentors, investors, advisors on topic areas,” said Red Wing Ignite executive director Neela Mollgaard. “The one thing we can do that is maybe more difficult in bigger cities is get them right in front of the customers, so they can get instant feedback on their business if they need to change their product to have it better received in the marketplace.”

The organization was founded in 2013 with the help of the city government and community foundations. It’s already competing in the larger tech world: local winners of a hackathon went on to the U.S. Ignite Conference in Silicon Valley, where they competed well with startups from there.

One such startup that’s benefited from Red Wing Ignite’s services is Live. Give. Save. Inc.

“It’s like a Fitbit for your finances,” said CEO Susan Langer of Red Wing.

Langer traveled to Africa in 1995 while she was working in marketing a large credit-card portfolio. She saw micro-financing introduced there and was inspired by how well it worked.

“Every time we go out and purchase something, we pay taxes on the products that aren’t listed on the price tag,” she said. “We are always going to purchase things regardless of tax. So why not tax ourselves?”

Users will be able to work with a smartphone app to “tax themselves” on purchases. Langer calls it a “new user experience in personal financial management.” The designated money can go towards a retirement fund or a charity of the person’s choice

Langer said she’s enjoying having her business in Red Wing, although there are some unique challenges.

“It’s tough to access finance for our startups,” she said. “Active investors for a financial technology business are usually on the coasts. The other thing is that it’s tough to recruit tech developers. We have a pretty big and complex vision. That type of talent is not in this area.”

She can address the need to network by connecting in the Twin Cities. She has good internet access in Red Wing, so she can host teleconferences with team members across the country, a bonus of working at Red Wing Ignite. Overall, internet access has improved in rural areas over the last few years.

Mollgaard said Ignite works to help new businesses find the connections that aren’t so obvious in rural areas.

“We’re working with some other businesses too to connect them with resources to launch their businesses, based on whatever their product is,” Mollgaard said. “We pool our local resources to help guide them.”

Langer has also worked with the Red Wing Port Authority, thanks to Mollgaard’s introduction to it. She enjoys the community spirit of being in a smaller town, with schools, local government, citizens and businesses working togther. She hopes businesses like hers in rural areas can bring in more people.

“They are a strong force in creating opportunities for families to raise children in a safe, healthy environment that offers so much in influencing young minds. The more businesses we create, the more jobs we have to attract families,” she said.

“The reward of being here is that it’s a lot less expensive to run a business in a small town for office space and living costs. There’s also a rich organic intimacy within the rural community. It’s an innate blend between personal and professional.”

Langer cited the collaborative culture at Ignite between all the different businesses who use the space. Besides Live. Give. Save., there’s one which works with virtual reality and one working on an innovative ramp for trucking.

“I think it’s really important that towns of all sizes try to support small businesses and entrepreneurs since that’s going to be the largest growth in our economies going forward,” Mollgaard said. 

“If communities want to stay vibrant and grow, it’s something they should look at. It’s also a great way to bring creative, vibrant minds together in local communities, and new ideas and new thinking.”

Brita Moore, bmoore@agrinews.com