Small business boost encouraged

Think tank says JOBZ doesn't help enough

By Mark Fischenich

MANKATO — Minnesota should be spending its economic development money on small start-up businesses rather than the large corporations traditionally targeted by states, according to a new progressive think tank and a pair of local entrepreneurs.

“We think the state of Minnesota has made a terrible mistake in chasing smoke stacks,” said Matt Entenza, a former Democratic state lawmaker and the founder of Minnesota 2020.

Entenza held a press conference in Mankato Monday, and will hold similar events in other parts of the state in coming months, to push for a change in Minnesota’s strategy for growing jobs in rural areas.

Entenza, who served as the House minority leader until last year, was joined by Tamika Bertram, owner of the River Rock Coffee shop in St. Peter, and Laura Dhuyvetter, founder of Laura’s Candy in St. Peter.

Also on hand was Lee Egerstrom, who does research for Minnesota 2020 and wrote a critique last month of a Minnesota economic development strategy that emphasizes tax breaks for existing businesses.

Egerstrom said the state would be better off providing entrepreneurs such as Bertram and Dhuyvetter with better access to the myriad services available to people starting a new business “rather than join the race with all the other states chasing the same large factories.”

There’s currently no easy way for an entrepreneur in most places in Minnesota to learn what help is available in terms of training, research, development, marketing and capital formation, he said.

“We have enormous resources in Minnesota,” he said. “At the same time, we have some trouble with people accessing them.”

Bertram, whose been in business for five years and now has 13 employees, agreed.

“Each entrepreneur comes forward and basically reinvents the wheel,” she said.

Advice and a list of resources needs to be available on one Web site or by calling one phone number because someone starting a business is so overwhelmed with tasks that there isn’t time to dig through bureaucracies, according to Bertram.

Dhuyvetter, whose three-year-old business has two employees, faced the same frustration.

“Like Tamika, I felt I was reinventing the wheel and thinking ‘Why can’t I find this information in one spot,’” Dhuyvetter said. “... The resources are out there. The programs are out there. Let’s coordinate them.”

That coordinated system should also provide new business owners the opportunity to talk to others with more experience, she said.

“All I want to do sometimes is talk to someone who’s two or three years in front of me,” said Dhuyvetter, who pledged to do the same for a future new businessman or businesswoman in return.

Bryan Stading represents one organization that’s providing that sort of coordination and mentoring in the Blue Earth County area.

Stading, who also attended the press conference, is the facilitator for the Riverbend Center for Enterprise Facilitation. Created by Blue Earth County and now being supported financially by the state, the center helps entrepreneurs develop a business plan, points them to sources of capital for start-up businesses and lines them up with more experienced business owners.

But the small-budget center can’t afford to advertise its services and relies almost exclusively on word-of-mouth to find new clients.

Entenza said the state can make similar help available and get the word out to small business. But it might need to do less of what its doing now — offering tax breaks to big companies through programs such as JOBZ (Job Opportunity Building Zones).

Programs like that tend to largely move jobs from one community to another and tend to be most successful along interstate highways rather than in more deeply rural parts of the state, Entenza said. They also often benefit companies that aren’t loyal to their current location and are likely to move again in the future.

“Laura’s not going to move,” he said, looking toward Dhuyvetter. “She’s not going to take Laura’s Candy to Mexico.”