Thanks to its success, the Cooperation Office has become something of a national model. What it does, it does well. But in a state that generates approximately 8,000 start-ups a year, an agency that boosts the "best" 6 hardly changes the entrepreneurial climate. The weakest 7,994 are left to succeed, or fail, on their own.
As president of the Women's Economic Development Corp. (WEDCO), another privately funded Minneapolis agency, Kathryn Keeley casts a wider net. Rather than the 20-year engineer at Honeywell Corp. or the former marketing manager at 3M Corp., it is novices -- 2,500 so far -- who stop in on Keeley, mainly women with little more than an idea about starting a business. And by Keeley's lights, the prospects for start-ups are every bit as daunting as they have always been.
"If you're a white male engineer in a technology-related field with a proprietary product, the climate for starting a business is pretty good," Keeley says. "But if you're in service or food, if you're not while or not male, you'll have a difficult time of it."
To half its clients, WEDCO offers sound and practical business advice, everything from managing cash flow to choosing a lawyear. But Keeley is just as proud of the service she offers to the other half: convincing them to give up their dream of launching a company, at least until they can come up with a better idea.
If any program would seem to have had a broad effect in helping start-ups, it is the Small Business Development Center at College of St. Thomas, one of 27 such centers around Minnesota. At St. Thomas, 100 new businesses are linked up each year with students eager for the experience of conducting market research or setting up an inventory-control system. Another 1,000 owners come in for short-term business-counseling sessions. Thousands more attend the college's seminars and workshops.
Ed Berris is thankful for St. Thomas's efforts. Berris started a consumer-electronics sales company last winter after watching a part-time business go under. At St. Thomas, counselors helped him write his business plan and set up his books, and generally provided "a good sounding board." And it helped: within eight months, he had accounts throughout the region. But did all this make his start-up any easier? After eight months, he was still working out of his basement, without a bank loan, without a sales staff. For Berris, as for most new business owners, easy is a relative term. Easier than what?
The impulse to help the business start-up springs from different motivations. Schools such as St. Thomas, for example, hope to provide business students hands-on experience with new ventures. WEDCO has a social purpose: to help women climb the ladder. The Cooperation Office, like many government programs and private development efforts, looks to create jobs and expand the local tax base.
And then there is profit.
Like their counterparts all across the country, the Minneapolis offices of the Big Eight accounting firms are eager recruits to the cause of new business formation. Besides offering planning advice and introductions to bankers and venture capitalists, your friendly Big Eight accountant may even give a cash-poor start-up a break on the bill, "although we prefer to think of it as an investment, not a reduced rate," says Coopers & Lybrand partner Jim O'Donnell.
Call it prospecting. "We're looking for a company that can grow into something substantial," says Tom Winkel of Arthur Andersen & Co. "It's not the corner grocery store we want -- it's the company that has the potential to be another Control Data." Arthur Andersen and everybody else.
One prospector who is much less picky is Norm Stoehr, one of Minneapolis's many Control Data alumni. On a snowy night in November, I met 80 men and women who made their way along freeways littered with fender benders to attend a meeting of Stoehr's The Entrepreneur's Network. "I can tell that you're entrepreneurs," Stoehr says as he warms up the crowd. "Big-company people probably wouldn't venture out on a night like this."
They are an eclectic group arranged at tables around the Minneapolis Hilton Ballroom: high-tech, low-tech, and no-tech company founders, veterans with 20-year histories and a corporate jet, and first-timers with a home office and a subscription to Corporate Report Minnesota. Men in pinstripes sit next to men in jeans, a kilted college student next to a grandmother in tailored Ultrasuede. Stoehr holds them as spellbound as a Chautauqua preacher -- part evangelist and part group therapist, and every bit the entrepreneur.
The Network is itself a start-up -- for Stoehr, his 15th. And at its heart is a simple and commonsense premise: that nobody can better understand the problems of an entrepreneur than another entrepreneur. And so for $450 a year, anyone who owns 20% of a company can sign up for the chance to talk things out with their peers at The Network's tightly structured monthly meetings. After the half hour of cocktails and the hour or so of introductions, each table of eight transforms itself into an ad hoc board of directors, thrashing out such issues as how to deal with an employee's alcohol problem or how to delegate authority to a new controller. Although scheduled for three hours, these sessions often last far into the night.
Not surprisingly, Stoehr's business is booming. What started as a 9-member network has now expanded to nearly 300. By 1990, Stoehr expects to be nationwide, not only with The Network, but with a full complement of entrepreneurial self-help programs, ranging from The Entrepreneur's Resource Group, selling seminars and consulting, to The Inner Circle, offering daylong skull sessions once each month, to Upstarts, targeted to the person "who is on the threshold of going into business." If start-ups were getting any easier, you would never know it from Norm Stoehr.
The Minneapolis Business and Technology Center -- "where office space is just a beginning" -- is a solar-heated concrete and glass bunker that squats across the street from the domed stadium of the floundering Minnesota Vikings, at the far edge of downtown. For 68 fledging businesses -- most of them service companies, most younger than three years old, most with fewer than 10 employees -- this is home.
