TECHdotMN: News about Minnesota Startups

A familiar face to many local tech entrepreneurs, Pete Birkeland has built a reputation as the “go to” for those applying to and working with the RAIN Source Capital angel network.

Well it’s time to update the rolodex, because he will soon be representing a different source of funding.

Birkeland confirmed that today will be his  last as RAIN Fund Program Manager with the St.Paul-based group and his new position as ‘CFO-in-residence’ with Golden Valley’s boutique IT/SaaS investment firm Cahill Adams will commence early April.

“It’s a similar move in that I’m going to continue working with startups and will likely be spending even more time in the entrepreneurial pool,” he said about the decision.

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Via News Release

“RAIN Source Capital is pleased to announce David L. Welliver of WellAdvised* as a Certified Rainmaker.  In this capacity David is responsible for identifying and organizing accredited investors into community-based angel investor groups to support local entrepreneurs who are leading early-stage private companies.  Welliver is responsible for organizing funds in the Twin Cities metropolitan area, and in communities in Central to Northern Minnesota.  RAIN Source Capital is the nation’s leader in organizing angel investors into funds with 23 funds and counting; RAIN Source Capital’s management team provides professional management services to its network of funds.”

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Over two non-stop days, a number of Minnesota tech entrepreneurs are commingling with accredited investors at the RAIN Maker’s Conference in Bloomington, Minnesota.

Hosted by RAIN Source Capital, the theme of this year’s 7th annual gathering is focus—where to expend capital and time to maximize future returns.  Richard Sudek, Chairman of Tech Coast Angels gave Thursday’s keynote and Keith Kegley from the XPrize Foundation delivered Friday’s closing remarks.  Five Minnesota technology start-ups are exhibiting at the event, in alphabetical order:

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In a continuation of its collaboration with Utah-based Funding Universe, RAIN Source Capital announced today the six startup companies that will pitching at the 7th annual RAIN Makers Conference on September 23 at the Hilton Minneapolis.

Best known as ‘CrowdPitch’, this years conference has integrated the pitch, vet (and funny money) routine into the experience — providing startups with unique visibility in front of and access to prospective angel investors from around the country.

Representing IT will be two one early stage Minnesota venture:

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Steve Mercil is the CEO of RAIN Source Capital, a multi-state network of angel investment funds that he founded in 1998. Steve is also Treasurer of the Angel Capital Association (ACA) and Chairman of the Board of Directors with the National Association of Seed & Venture Funds (NASVF).

RAIN Source Capital currently oversees 23 funds across six states with approximately $20 million in committed capital from around 450 individual angels. Since inception, the firm has  funded over 70 startups for which RAIN Source raised a cumulative $150m.

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Six startups gave their four-minute pitch at the second Crowdpitch Minneapolis event hosted yesterday by Rain Source Capital and FundingUniverse, but MinuteBids stole the show.

Crowdpitch is a competition event designed to bring together local tech entrepreneurs, mentors and service providers. Winners receive in-kind services valued at about $4,800.

Jon Coudron, co-founder of MinuteBids, made the pitch. After the event he said, “This was a great experience all around—not only did we get to field some great questions and receive feedback on our pitch, but we were able to walk away with some additional validation that we’ve got a good business.”

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One week from today—on Thursday, July 15—CrowdPitch returns to Minnesota. Only this time, it’s on the other side of town at the Dorsey Ewald Conference Center in St. Paul.

This Rain Source Capital/Funding Universe collaboration is designed to bring together local tech entrepreneurs, mentors and service providers in an informal and energetic setting.

According to the website,

“Crowdpitch is the ‘American Idol’ for those tech entrepreneurs selected to pitch their company to a panel of experts and a live audience.“

The panelists will serve as a means of vetting the early stage companies through a brief Q&A session before the audience casts their vote with $100 “funny money” towards the best business. Ultimately, the winner will receive in kind services ranging from financial and accounting consulting to Amazon web services – collectively valued at $4,800.

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By Thomas Lee, MedCity News

“Investors rejoiced when Minnesota finally passed a five year, $50 million angel tax credit. Only one problem: the state’s largest angel group will be largely shut out.

Under a last minute provision inserted into the bill, investors participating in angel deals through individual retirement accounts and family trusts will not be eligible for the tax credit this year. That spells bad news for Rain Source Capital in St. Paul, where most of its funds list an IRA or trust as a member.”

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By Arundhati Parmar, Finance and Commerce

“…St. Paul-based RAIN Source Capital, a multistate angel network group, is finalizing a partnership with a Utah company that focuses on matching entrepreneurs with investors and lenders.

Through the revenue and expense sharing agreement, RAIN Source principals will manage the Twin Cities office of South Jordan, Utah-based Funding Universe, which hosts free events and provide services to help entrepreneurs get access to capital. Funding Universe, in turn will manage the new RAIN angel fund that RAIN Source Capital is setting up in Utah. Funding Universe is investing $100,000 to become a member in the fund. RAIN Source plans to raise a minimum of $1 million in the next couple of months for that fund.”

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ReconRobotics Inc., a company that was formed to commercialize patented technology developed in the University of Minnesota Distributed Robotics Laboratory, received its initial funding via William C. Norris Institute, (part of the University of St. Thomas Opus College of Business), in December 2006 and later and again June 2007 (both of unknown amounts).  On April 17, 2009, the Minneapolis-St.Paul Business Journal reported (unsourced) that the company had raised “upward of $3mm in capital, mostly from angel investors.” Later that year, sometime in Q4 2009, the company received  an additional $75k from local Angel investment network Rain Source Capital.

And now- according to a SEC filing on 3/30/10, the company continues its fund raising initiatives, recently securing another $1.5mm.

Edina-based Recon Robotics designs, manufactures, deploys and supports miniature robotic systems. The company’s flagship product, Recon Scout, is “a rugged, stealth, mobile, and immediate tactical reconnaissance robot designed to help save lives.”