Tips from successful Minnesota startups

S co-founder Justin Kaufenberg worked for several years before taking a salary at the Minneapolis company, a provider of data services for clubs and athletic leagues.

“In particularly difficult times, we would take out a new credit card to pay the wages for our first employees,” he recalls.

Along the way, he learned about working with banks, finding angel investors and setting up legal infrastructure. Patience, he said, became a requirement.

In 2016, more than a dozen years after he started, NBC bought SportsEngine, and Kaufenberg became a venture capitalist helping other companies get off the ground.

We asked him and several other startup founders in the Twin Cities for practical ways to start a business. Here are some of their tips:

Find mentors and tools

Whether you’re trying to find mentors, build a website, or learn about angel investing, the Internet is a place to start.

Startup veterans advise turning to LinkedIn and Twitter to find new connections in your industry. “A fairly simple Google search will help you find angel investors,” Kaufenberg said.

Morning Consult co-founder Michael Ramlet turned to mentors from his undergraduate days at the Carlson School of Management at the University of Minnesota as he built what is now a global decision intelligence company.

“It was helpful to ask these mentors, ‘How do you start a bank account? How do you get a tax ID number?” Ramlet said.

For those who don’t have such contacts, look for successful entrepreneurs in your space. Some answer direct questions. “I still make one phone call a week with someone starting a business,” Ramlet said.

A to Z Creamery founder Zach Vraa started his custom ice cream business as a hobby on Instagram during the pandemic. When he got serious, he created a limited liability corporation, learned about food industry regulations, and created a website using free tools at

“The first thing you should do when you start a business is create a website,” he said.

Organizations such as Women Venture in St. Paul offers classes and advises clients to make a business plan before applying for her loans.

“It’s important that they understand the assumptions they’re making behind the projections,” said David Louiselle, director of lending at Women Venture. “Especially after the revenue component, they have to have a solid understanding of how they’re going from point A to point B, from $0 to $50,000. That has to make sense to us and to them.”

Keep personal expenses low

Kaufenberg said he got advice early on to keep his expenses low, so he lived on the bare minimum after graduating from college. He didn’t have a car and sometimes painted a house to earn money for food.

Both Dori Graff and Mary Fallon, co-founders of the online children’s goods store Kidizen, were younger mothers who left their jobs 15 years ago at digital agencies to start their own businesses. They did part-time contract work to pay the bills and relied on their spouses early on. “We weren’t getting paid, and it was tough,” Graff said.

Even today, she said she would do more in the agency world, but appreciates owning a stake in a business with a sustainability mission.

Hire a lawyer or accountant

Kaufenberg recalls making costly mistakes by creating multiple LLCs as SportsEngine grew. This turned out not to be the best structure to raise money. Later, an attorney was hired to convert it to a C corporation.

“We believed we didn’t have the money to hire a good lawyer. We used a lot of online tools to do our own law. That was a mistake,” he said. “There are wonderful lawyers who specialize in working with startups. For a small amount of money they will do the critical element of getting your company off the ground.”

The same goes for finding an accountant, Kaufenberg said. “We were really immature in that area,” he said.

Obstacles are routine

When Kidizen’s co-founders launched the first iteration of the business in 2010, it failed. This was a platform for attaching digital content to physical things so that the story goes with it as it moves from person to person.

“We had to go back to the drawing board,” Graff said. “We did a pretty big roll at this point and talked to our user base.”

They focused on children’s merchandise because it’s “an ongoing need” for parents, she said. In 2014, Kidizen was born.

Prepare to work hard

Jazz Hampton was a corporate attorney before he and two co-founders last year launched TurnSignl, a real-time on-demand app that gives drivers access to live legal representation during traffic stops and accidents.

He now works even longer hours, but feels fortunate that TurnSignl has attracted enough investment for him to collect a salary, albeit a lower one than before.

“I’m building something with people I really care about,” Hampton said. “It’s the most fun I’ve had working.”

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