RAEDI Hires Director of Economic Development
Rochester Area Economic Development, Inc. (RAEDI) today announced the hiring of Kirk Bustrom to the position of Director of Economic Development. He most recently worked for Northwest Bank & Trust Company as Assistant Vice President for their Economic Development Division.
Bustrom will lead negotiations on business partnerships for commercial and industrial business development and oversee aspects of the financial elements of RAEDI’s mission including the creation of funding initiatives for new and existing business.
“We are pleased to welcome Kirk to the RAEDI team to help advance our mission to retain, grow, and diversify our area economy. His extensive background in planning, development, and finance will be a great fit for our organization,” said RAEDI President John Wade.
In addition to previous designation as a certified public accountant, Bustrom has over 20 years of professional experience in consulting and project management in the capacity of community and economic development. His experience includes working in various capacities in community and economic development with the Upper Minnesota Valley Regional Development Commission, the University of MN-Duluth Center for Economic Development, and Itasca Economic Development Corporation.
“I’m excited to work with the RAEDI team and to advance the already dynamic development environment in the Rochester area,” said Bustrom.
Bustrom began his new position with RAEDI on October 18, 2021. His educational background includes a bachelor’s degree in accounting from the University of Minnesota, and a Master of Science in Geographic Information Sciences (MSGISc) from the University of Denver.
RAEDI Receives Funding to Help Emerging Entrepreneuers
Rochester Area Economic Development, Inc. (RAEDI) is pleased to announce that the organization has received $100,000 in initial funding from the Minnesota Emerging Entrepreneur Loan Program (ELP) to provide as loans to support the growth of businesses owned and operated by minorities, low-income persons, women, veterans and/or persons with disabilities.
“The Emerging Entrepreneur Loan Program is an invaluable tool that will help RAEDI empower historically underserved entrepreneurs in the Rochester area,” said John Wade, President of RAEDI.
In order to qualify for a loan under the ELP, businesses must be based in Minnesota and owned and operated by one or more Minnesota residents who are minorities, low-income persons, women, veterans and/or persons with disabilities. The program will finance a variety of start-up and expansion costs, including normal expenses such as machinery and equipment, inventory and receivables, working capital, new construction, renovation, and site acquisition. Businesses eligible for loans include, but are not limited to, technologically innovative industries, value-added manufacturing, and information industries.
ELP loans can range from a minimum of $5,000 to a maximum of $150,000 per project, matched at least 1:1 by new private financing. Beginning microenterprises (defined as businesses that have fewer than five employees and have generated sales revenue for two years or less), including retail businesses, may apply for $5,000 to $50,000 without private matching funds.
“We’ve seen the need grow for the ELP firsthand over the last year and a half and are eager to deploy these funds to help grow, retain, and diversify the Rochester area economy,” said Sean Williams, Director of Entrepreneurial Services for RAEDI.
RAEDI was one of 26 nonprofit lending partners across the state to receive the funding. In total, the Minnesota Department of Employment and Economic Development (DEED) awarded grants totaling $3.1 million.
The program has additional goals of providing jobs for minority and/or low-income persons, creating and strengthening minority business enterprises, and promoting economic development in low-income areas.
Entrepreneurs interested in learning more can email firstname.lastname@example.org or call (507) 288-0208.
John Wade Hired as RAEDI President
(RAEDI) Board of Directors is pleased to announce the hiring of John Wade as president of the organization. Wade has been serving as interim president since October 2020.
“In the short time that John Wade has served as interim president, he’s proven that he’s able to lead the organization forward to help more area businesses,” said John Beatty, Chair of the RAEDI Board of Directors.
Beatty said Wade oversaw the completion of RAEDI’s new strategic plan, which was approved by the board earlier this year, has initiated and fostered partnerships throughout the Rochester MSA, and is working to create programs and funding initiatives for new and existing businesses. “We are pleased with the direction John is taking the organization and the vision he has to continue to strengthen the assets of the Rochester area economy,” said Beatty.
“RAEDI has always been an invaluable resource for the Rochester area since its founding, and I look forward to helping further deliver on its goals of growing and diversifying the area economy,” said Wade.
Wade is a resident of Rochester whose extensive background includes an emphasis on communications, business development, and public-private partnerships
Cytotheryx latest company to receives EDF loan
Congratulations to Cytotheryx, a biomedical research company in Rochester focused on the development of high-quality source of primary human liver cells, for receiving a $200,000 EDF loan. RAEDI Board of Directors and the Rochester City Council approved the loan at their regular scheduled board meetings in September and October.
“The EDF funds will allow our team to continue to focus on advancing the science and building a successful company for which our whole community can be proud,” said Anna Haugo, Director of Business Development at Cyotheryx. “The RAEDI team were phenomenal partners in the process. They offered important feedback and communicated with us frequently. We are grateful for their support and guidance.”
Cytotheryx has the exclusive license to a patented, genetically engineered pig that serves as a bio incubator to produce human liver cells. Liver cells cannot be produced outside the body, and there is a significant unmet need for these cells in the research and medical fields.
RAEDI Board of Directors appoints John Wade to serve as interim president for the organization
Rochester Area Economic Development, Inc. (RAEDI) Board of Directors is pleased to announce the hiring of John Wade of Rochester as interim president for the organization. Wade replaces outgoing President Ryan Nolander, who has left to pursue a commercial real estate opportunity in Rochester.
“John has more than 25 years of experience in senior management and economic development work and brings a deep understanding of the community that will be vital to the successful interim operation of RAEDI,” said RAEDI vice chair John Beatty.
Beatty said Wade is experienced in developing innovative programs and has initiated and fostered robust partnerships and strategic alliances with government, allied agencies, and key stakeholders in delivering effective programs and services to investors.
Wade previously served as Rochester Area Chamber of Commerce President from 2003-2013, and more recently was co-owner of Clements Chevrolet Cadillac before selling the business earlier this year.
“John has a track record of strong leadership and communication skills, and experience implementing major projects with community partners, including fundraising, all of which were noted in the position announcement as preferential and desirable for the ideal candidate,” said Beatty.
A search committee of seven community leaders, including Mayor Kim Norton (City of Rochester), Mary Blair-Hoeft (City of Byron), Kelly Krajnik (Mayo Clinic Ventures), Commissioner Ken Brown (Olmsted County), Norm Doty (Express Pros), Dan Beck (Think Bank), and Adam Benike (Benike Construction) followed the careful review of resumes and applications, interviewed multiple applicants, and then recommended John Wade as RAEDI’s Interim President.
“Our economic future remains bright but not without significant challenges. RAEDI remains committed to developing private and public partnerships and investments to ensure that we are able to develop, grow, and diversify our economy for all,” said Wade.
Regional capital investment fund hits $2 million goal
Rochester, MN (August 21, 2018) – After one year, since its official launch, the Southeast Minnesota Capital Fund LLC (Fund) has reached its $2,000,000 funding goal and closed its fifth investment in Rochester-based Ambient Clinical Analytics.
“For our community, having an active new business fund is very important because we are helping attract and retain companies that will create good paying jobs in our region,” said Joselyn Raymundo, a member of the Fund and a Founder/CEO of Rochester Home Infusion.
The Fund launched in August 2017 with $775,000 and 25 investors. Due to strong investor interest, Fund members voted in January 2018 to set a new fund target of $2 million. With the target now reached, thanks to the commitment of 56 investors, the Fund is the largest in southeast Minnesota.
“The goal of the Fund is to provide much needed, but very scarce, seed capital to new companies with strong growth potential. It nicely complements other early-stage funding sources, such as the public Rochester Economic Development Fund,” said Xavier Frigola, Treasurer of the Fund. “Our entrepreneurs need to know there are individuals in the community that will support bold, yet financially sound, business ideas.”
While not geographically limited, most of the investments to date have been in southeast Minnesota with one investment in Minneapolis. The Fund has invested a total of $500,000 in the following companies: Sonex Health, Oculogica, Vyriad, Geneticure, and now Ambient Clinical Analytics.
Entrepreneurs interested in funding are encouraged to visit www.SEMNcapital.com
Vyriad to Build State of the Art Facility for Manufacturing Oncolytic Virus Anti-Cancer Vaccines
Congratulations to Vyriad! The biotechnology company recently announced the signing of a contract to build out its facility in 25,000 square feet of leased space on the IBM Campus in Rochester, Minnesota. The building plans include offices, research laboratories, and a state-of-the-art Good Manufacturing Practice (GMP) facility for production of the company’s clinical-stage oncolytic virus therapies that are in development for the treatment of various cancers.
The custom build out will be financed with proceeds from a recently completed $9 million secured convertible note financing, which included participation by Mayo Clinic, Rochester Area Economic Development, Inc., and the Southeast Minnesota Capital Fund LLC. In addition, the state of Minnesota and the city of Rochester have committed $370,000 in equipment funding.
Southeast MN Angel Fund Makes First Investments
Rochester, MN – Just six months from its launch, the Southeast Minnesota Capital Fund LLC (SEMCF) is pleased to announce it has made its first two investments: Rochester-based Sonex Health and Minneapolis-based Oculogica.
“Our investors are incredibly excited to make our first investments in these two companies. They have unique solutions for carpal tunnel repair and concussion diagnosis and show great promise for growth, job creation and an interest in staying in our region and state,” said David Herbert, SEMCF Chair.
“We are very grateful for the trust and shared vision demonstrated through this investment from the SEMCF. We are confident that this relationship will help us achieve great strides in providing a better treatment option for patients with carpal tunnel syndrome.” said Dr. Darryl Barnes, CEO and Co-Founder of Sonex Health LLC.
“Oculogica is thrilled to be one of the initial investments of the Southeast MN Capital Fund. We are excited to have their wealth of relevant knowledge and valuable network supporting our efforts,” said Rosina Samadani, CEO of Oculogica Inc.
The Southeast Minnesota Capital Fund (SEMCF) launched in August 2017 with $775,000 and 25 investors and has grown to $1,400,000 and 41 investors since that time. Investor interest has been strong and fund members recently voted to expand the fund to $2 million. Interested new investors are encouraged to contact Xavier Frigola at email@example.com, soon, since the fund will close to new investors when it reaches its $2 million goal or June 30, 2018, whichever comes first. SEMCF was created by Rochester Area Economic Development, Inc. (RAEDI), and spearheaded by its Journey to Growth regional economic development plan.
SEMCF will help support the growing number of new companies in our area that have the potential to deliver significant returns. “We expect to see many medical and information technology opportunities,” said L.J. Johnson, SEMCF Vice Chair, “but we are also watching for worthwhile investments in other fields that are strong in our area, like agriculture, manufacturing and service businesses.” While not geographically limited, the primary investment focus of the fund will be the southeast Minnesota region.
For more information on the fund visit, http://j2gmn.com/regional-angel-fund/
Rochester Economic Development Fund Brings Millions of Dollars and is Key to Job Creation
Rochester, MN – Rochester Area Economic Development, Inc. (RAEDI) is pleased to announce that the Rochester Economic Development Fund (EDF) it administers has invested over $1.5 million in 15 companies over the last 5 years. Fund companies have raised an additional $61 million, much of which has come from outside of the Rochester area. This is 44 times the amount of EDF support provided.
The $5 million, city-funded loan program was launched in 2012 and is administered by RAEDI to assist companies who show promise for bringing new dollars into the area economy and create high paying jobs.
During 2017, the fund supported four new companies: biotech Vyriad, medical device Craniovation, laboratory equipment Smart LabHood Solutions, and music company Spark DJ for a combined total of $240,000.
Vyriad Inc. is a biotechnology company that uses viruses to treat cancers while not affecting the healthy tissue. Vyriad is planning to build a manufacturing facility in Rochester at the IBM campus with plans to employ at least 30 people by 2019.
Craniovation Inc. is a medical device company who has developed an innovative solution to treat aggressive brain tumors using light delivered via a minimally invasive device allowing patients to avoid undergoing invasive brain surgery.
Smart LabHood Solutions Inc. manufactures and sells the EcoDenser, a laboratory head exchanger that retrofits existing laboratory fume hoods and dramatically reduces laboratory water waste.
Spark DJ Inc. is a music technology startup that replaces disk-jockeys (DJs) with technology utilizing an on-demand software service that has artificial intelligence to manage the music component of your party in real-time including managing song requests, seamlessly transitioning music, and live curating playlists.
“We couldn’t be more pleased with the positive impact of the Rochester Economic Development Fund to our local economy. Being the first investors allows us to have a greater chance to retain companies in Rochester. In return, fund companies are investing in Rochester where almost 100 jobs have resulted. The potential for their real growth lies ahead of them,” said Xavier Frigola, RAEDI’s Director of Entrepreneurial Programs and a manager of the Fund.
Companies, combined to-date, have created 80 jobs. Fund companies currently occupy almost 48,000 square-feet of space in Rochester, and 56% of these companies are women or minority-owned with 67% having product sales.
“The EDF funding came at a critical moment for Spark DJ. It allowed us to finish the development of our product, launch, and generate revenue. EDF was key for us to solidify our presence in Rochester, and we encourage local entrepreneurs to consider exploring this funding source,” said James Jones Jr., co-founder and CEO of Spark DJ.
Companies based in Rochester that mainly sell their goods/services outside of Rochester can apply for funding by contacting RAEDI.
In the spirit of celebrating Global Entrepreneurship Week, Journey to Growth, RAEDI and 504 Corporation invite you to help us recognize entrepreneurs in our region on Friday, November 17, 2017, from 4:00 - 6:00 p.m. at the DoubleTree by Hilton.
Sponsorships are available. Contact Rochester Area Economic Development, Inc. (RAEDI) at 507-288-0208 for more information.
Space is limited. Register now!
Rochester, MN – The Southern Minnesota Initiative Foundation (SMIF) is the latest group to invest in the Southeast Minnesota Capital Fund, raising commitments to the fund to $1 million. The fund, created by Rochester Area Economic Development, Inc. (RAEDI), and spearheaded by Journey to Growth (J2G), is funded by a group of angel investors who will help support the growing number of startup companies in the medical and technology fields who have the potential to deliver significant returns. While not geographically limited, the primary investment focus of the fund will be the southeast Minnesota region.
“It is an honor to announce that SMIF has joined the investors in the Southeast Minnesota Capital Fund. We are also thrilled that their investment is putting the fund over the $1M mark,” said Xavier Frigola of RAEDI and Secretary/Treasurer of the Fund.
SMIF, through their existing seed and equity funds, has been a partner to numerous southeast Minnesota-based companies. By investing in the Southeast Minnesota Capital Fund, SMIF will now be able to expand their impact on the region and the fund will have access to SMIF’s expertise and opportunity pipeline.
“SMIF has long seen the need for additional equity dollars to help new businesses start and grow here in our region and that is why we created our own equity fund a couple years ago. We are pleased to now contribute to the Southeast Minnesota Capital Fund and look forward to future opportunities to partner on equity investments,” said Tim Penny, President and CEO of SMIF.
Rochester-based Pace International Inc. is about to start construction on a $1.95 million, 18,000-square-foot expansion to its headquarters at 3582 Technology Drive NW. The family-owned company built the 48,000-square-foot distribution center (above) in 2005. (Submitted photo: Pace International Inc.)
MN Snapshot: Rochester’s Pace International to expand
By: Anne Bretts September 14, 2017
Editor’s note: Minnesota Snapshot reports interesting sales and development projects happening throughout Minnesota. The transactions are based on the certificates of real estate value filed with the state Department of Revenue, copies of which are available with the story at finance-commerce.com. Other items may come from government agendas and news releases.
Rochester, Minnesota, is best known for the huge impact that Mayo Clinic and technology companies have in expanding its economy.
That economy also is growing because the greater Rochester area has 300 manufacturing and distribution companies, according to Rochester Area Economic Development Inc., also known as RAEDI.
Take Pace International Inc., a family-owned distribution company headquartered at 3582 Technology Drive NW. The 45-year-old company, which built its current facility in 2005, is about to invest $1.95 million in two additions, adding a total of 18,000 square feet to its 48,160-square-foot plant.
The 9,000-square-foot addition on the northeast side of the complex is going to double the company’s office space, and the addition along the eastern side will create more room in the warehouse.
“We’ve been thinking about it for over a year,” said Tim Deutsch, plant manager and part of the third generation in the family in leadership roles in the company.
He expects the new space will let the company hire up to 22 workers during the next three years, boosting its payroll to more than 100 employees in town. It also employs eight people in its retail store in Gordonsville, Minnesota.
Tim Deutsch credits Rochester Area Economic Development President Gary Smith with helping the family cover the cost of the expansion.
“He gave us a rundown of different options,” Tim Deutsch said.
After researching the possibilities, Smith recommended the Minnesota Job Creation Fund, launched in 2014 through the state’s Department of Employment and Economic Development.
The Job Creation Fund is available for companies that plan to add at least 10 full-time jobs and invest at least $500,000 in their businesses. So far, DEED reports that participating companies have planned to invest $923.8 million and pledged a total of 4,338 jobs. The companies receive the aid only after they fulfill those pledges.
If Pace completes the additions and adds the new jobs, it will receive $196,000.
Smaller companies like Pace are important to the economy, said Smith.
“What they add is diversification,” he said.
Having a broad variety of companies provides a cushion when there’s a downturn, especially when the downturn comes in one part of the economy.
“We’d rather have 10 businesses that employ 40 people than one company that employs 400.”
So, what does Pace do? That’s evolved during the last four decades.
“Grandfather started the company in 1972 as a distributor for TV repair parts,” Tim Deutsch said.
The televisions, record players and other appliances of Jim Deutsch’s early days are long gone. The founder died in 1999 but his son and current CEO Patrick Deutsch, along with Patrick’s sons, Tim and Eric, have adapted to new technology. The company now is the exclusive national distributor of DISH network equipment and content to private cable installers. It also sells satellite television reception equipment to recreational vehicle dealers and owners.
“The RV market has continued to grow,” Tim Deutsch said.
With people shifting to receiving content online, the company has expanded into routers and other wireless reception equipment.
“Five years from now we’ll probably be doing something completely different,” Tim Deutsch said.
SE MN Capital Fund Launch
After months of planning and behind the scenes efforts, the Southeast Minnesota Capital Fund LLC launched on August 16, 2017. The fund, created by Rochester Area Economic Development, Inc. (RAEDI), and spearheaded by Journey to Growth (J2G), is funded by a group of 25 angel investors who will help support the growing number of startup companies in the medical and technology fields who have the potential to deliver significant returns. While not geographically limited, the primary investment focus of the fund will be the southeast Minnesota region.
“Angel investors are typically one of the first sources of funding for innovative startups. And these startups may be tomorrow’s large employers of the region. There are numerous angel funds in the metro area but this is the first one here,” said Xavier Frigola of RAEDI and Secretary/Treasurer of the Fund.
For more information on the Southeast Minnesota Capital Fund or to become an investor, contact the RAEDI office at 507-288-0208.
Finance & Commerce featured the Rochester Economic Development Fund that RAEDI administers on behalf of the city of Rochester in its August 8, 2016, edition. Economic development fund participant, Mike Rolih of GoRout, was also highlighted in the article. Read more.
Rochester Area Economic Development Inc. has invested almost $100,000 from a sales tax fund in two promising young businesses. The recipients are a maker of on-field football technology called GoRout LLC and a health-care information platform called Hunhu Healthcare, Inc.