Minneapolis Startup Funding: 10 VC Firms Investing in Local Innovation
Minneapolis has rapidly emerged as a vibrant startup hub, significantly enhancing its position in the global startup ecosystem. In 2024, the city advanced five spots in the Global Ecosystem Index, reflecting its growing influence in the entrepreneurial landscape.
The tech sector alone contributes approximately $28 billion to the local economy, accounting for nearly 10% of the workforce. This growth is supported by innovative startups such as Flywheel, bolstered by top-tier universities and initiatives like Launch Minnesota.
In this guide, we will cover 10 venture capital firms funding Minneapolis startups, key fundraising strategies, and essential networking and local resources.
The 10 Top Venture Capital Firms in Minneapolis
Bread and Butter Ventures
About: Bread and Butter Ventures is an early stage venture capital firm based in Minnesota, the Bread and Butter State, investing globally while leveraging our state and region’s unparalleled access to strong corporate connections, commercial opportunities, and industry expertise for the benefit of our founders.
Sweetspot check size: $ 300K
Thesis: Investing in amazing founders, focusing on several core sectors of the economy: food/ag tech, health tech and enterprise SaaS
Atland Ventures
About: Atland Ventures is a student-run venture capital firm that focuses on the field of financial services and venture capital.
Sweetspot check size: $ 25K
Traction metrics requirements: We will not invest in pre-product.
Thesis: We invest in companies solving problems felt by Gen Z. Follow our generation's trends.
Arthur Ventures
About: Arthur Ventures began with a simple goal in mind–to seed and enable growth in their partner companies. They believe in the power of the growth cycle and the positive effect that well-managed businesses can have in society. Arthur works with companies to help solve crucial problems for customers in areas of information technology, life sciences, and clean technology.
Sweetspot check size: $ 5M
Thesis: We lead investments in high-growth B2B software companies located in every region across North America and Western Europe (aside from Silicon Valley).
Norwest Equity Partners
About: Norwest Equity Partners (NEP), a Norwest Capital strategy, champions good businesses with a goal of achieving enduring success. NEP seeks to invest in growing and profitable middle-market companies primarily across the business services, consumer products and services, and industrial growth sectors. We help create opportunities and long-term value by finding and fueling what’s working in successful companies to help build them into industry leaders.
TinySeed
About: TinySeed is the first startup accelerator in the ‘independent funding’ space – that space between bootstrapping and venture capital. While not strictly RBI, we are designed for SaaS founders who want to maintain control of their companies and who up until last year, would have bootstrapped due to the lack of relevant funding options.
We have a simple investment philosophy – we make investments in companies with market traction and a demonstrated ability to drive innovation.
Investing is more than a transaction for us – it’s a mutually beneficial relationship. Our initial investment size typically ranges from $500,000 to $5 million, and we’re active in all investment stages – from seed and early stage to growth – of companies operating within North America.
Gopher Angels
About: Gopher Angels is MN's top angel investing network. Founded in 2012, we've invested over $27M in 85 companies across Minnesota and the Midwest.
Thesis: We fund Seed and Series A companies that have a substantial market opportunity, and the team and traction to demonstrate they can achieve it.
We’re industry agnostic, and invest in healthcare and health IT, enterprise and SaaS, food and beverage, medical devices, agtech.
Vensana Capital
About: Vensana Capital is a venture capital and growth equity investment firm dedicated to partnering with entrepreneurs who seek to transform healthcare with breakthrough innovations in medical technology.
Thesis: Vensana is actively investing in development and commercial stage companies across the medtech sector, including medical devices, diagnostics and data science, drug delivery, digital health, life science tools, and tech-enabled services.
Groove Capital
Sweetspot check size: $ 100K
Thesis: Groove Capital is where entrepreneurs in Minnesota go to get their first institutional investment. We partner with great teams, who have demonstrated an ability to execute, with some evidence of a defensible advantage, in a market that is compelling.
Capita3
About: Capita3 is building a global financing institution for investing in exceptional women leading game-changing companies. In addition to financial investment, Capita3 focuses on developing startup CEOs to maximize their growth and the company's exit potential. We’re leading the next generation of venture capital, and we’ll set a new standard for how venture financed startups grow and exit.
Why Minneapolis is a Thriving Startup Ecosystem
Minneapolis has solidified its position as a dynamic and thriving startup ecosystem, experiencing significant growth in recent years. The city's tech industry alone contributes approximately $28 billion to the local economy, accounting for nearly 10% of the workforce.
Key Industries Attracting Investment
Several sectors in Minneapolis are drawing substantial venture capital attention:
- Healthtech: Ranked 22nd globally, Minneapolis boasts 48 healthtech startups, reflecting its strength in healthcare innovation.
- Software & Data (SaaS): With 77 startups, the city holds the 46th position worldwide in this sector, underscoring its robust software development landscape.
- Hardware & IoT: Minneapolis ranks 58th globally, with 7 startups focusing on hardware and Internet of Things technologies.
Success Stories of Scaled Startups
The city's supportive environment has nurtured several startups that have successfully raised capital and expanded:
- Sezzle: A fintech company offering interest-free installment plans at online stores, Sezzle reported $56 million in Q2 revenue.
- Branch: A fintech company providing digital wallet solutions to help employees manage their finances.
- Niron Magnetics: Launched in 2014, Niron Magnetics received $17.5 million from the U.S. Department of Energy to scale up prototyping of its sustainable permanent magnets and has raised more than $100 million in total funding.
How to Fundraise Successfully in Minneapolis
Securing venture capital in Minneapolis involves leveraging the city's vibrant startup ecosystem and engaging with local resources tailored to support founders. Here's how to navigate the fundraising landscape effectively:
Engage with Local Startup Events and Meetups
Participating in Minneapolis's dynamic startup community can significantly enhance your fundraising efforts. Key events and groups include:
- Twin Cities Startup Week: An annual event that brings together entrepreneurs, investors, and industry leaders through workshops, pitch competitions, and networking sessions.
- Minnebar: One of the nation's largest and longest-running technology unconferences, offering a platform for knowledge sharing and networking among tech enthusiasts and entrepreneurs.
- Hackers and Founders Minneapolis: A meetup uniting the tech community in Minneapolis, drawing an equal split of hackers and founders to explore partnerships and build relationships.
Leverage Local Resources and Support Programs
Minneapolis offers various programs and organizations designed to assist startups:
- Launch Minnesota: A statewide initiative providing grants, tax credits, and educational opportunities to innovative startups.
- BETA MN: A nonprofit organization offering founders from top local startups the resources and relationships required to scale their businesses.
- University of Minnesota's Venture Center: Provides services to help establish new companies, working with researchers, entrepreneurs, investors, and advisors.
Additional Considerations for Minneapolis Founders
- Understand Local Investment Trends: Research the specific industries and types of startups that Minneapolis investors are currently focusing on. Aligning your business model with these trends can increase your attractiveness to local VCs.
- Build Relationships with Local Mentors: Engage with experienced entrepreneurs and business leaders in the Minneapolis area who can provide guidance, introductions, and insights into the local funding landscape.
- Explore Regional Funding Opportunities: In addition to local VCs, consider regional angel investor networks and crowdfunding platforms that are active in the Minneapolis startup scene.
Connect With Investors in Minneapolis Using Visible
At Visible, we often times compare a fundraise to a B2B sales and marketing funnel. At the top of your funnel, you are finding new investors. In the middle, you are nurturing and pitching potential investors. At the bottom of the funnel, you are working through diligence and ideally closing new investors.
With the introduction of data rooms, you can now manage every aspect of your fundraising funnel with Visible.
- Find investors at the top of your funnel with our free investor database, Visible Connect and find a filtered list of Minneapolis's investors here.
- Track your conversations and move them through your funnel with our Fundraising CRM
- Share your pitch deck and monthly updates with potential investors
- Organize and share your most vital fundraising documents with data rooms
Manage your fundraise from start to finish with Visible. Give it a free try for 14 days here.
