Compared to many big cities, it’s easy to connect to folks who can help you, whether it’s access to capital, advice or to influence legislative change. In addition, angels that invest local companies benefit from income tax credits in both Minnesota and North Dakota, helping to mitigate the risk that is inherent in investing in start-ups.
Seed Capital – Local & State
The FM Angel Investment Fund had been the Fargo Moorhead’s primary angel investment fund over the past decade, looking for equity investment opportunities in early to mid-stage private companies in North Dakota or Minnesota, that operate in the manufacturing or technology sector with high growth potential. With this fund currently fully funded, the 701 Angel Fund was established in 2015 to attract capital and startup investments. The 701 Angel Fund invests in determined entrepreneurs and high-growth opportunities. The fund works with other regional investors to maximize the exit potential of our start-up investments. The fund is certified as a North Dakota Angel Fund by the ND Tax Department and is a Certified Angel Fund for the Minnesota Angel Tax Credit.
Gen7 Investments was formed in 2017 out of Forum Communications. Gen7 consists primarily of a portfolio featuring consumer goods, media companies, and brand agencies. Their investments are often made to help strong companies grow and/or assist in a transition of company acquisition.
The Dakota Venture Group (DVG) is a University of North Dakota student-run venture capital investment fund, founded in 2006. DVG manages multiple funds and utilizes a vast network of industry expertise in its due diligence research and investment decision making.
Other funding sources continue to develop, evolve and/or focus their attention on our region. Our organization looks to cultivate relationships with these funds to help facilitate potential deal flow for them. Recent new relationships include partners like Great North Labs and Venn Foundation. In addition, North Dakota State University is in the midst of creating a fund much like the above-mentioned DVG, and a new local fund called Northern Plains Fund plans to roll out in the Fall of 2019.
New startups in North Dakota may apply for Innovate ND which not only provides opportunities for entrepreneurial assistance and mentorship, but also enables the startups to access up to $40,000 in funds through a combination of reimbursements and grants.
Venture Capital – Local, State & Region
Arthur Ventures is an early stage venture capital firm that invests in business-to-business (B2B) software companies. Arthur Ventures focuses specifically on companies providing software-as-a-service (SaaS) and cloud-enabled tools and services.
Linn Grove Ventures invests in innovative agriculture, food, health, and animal technologies and the companies transforming these industries at the global level. It is active in providing strategic financing and business leadership to help innovative companies move beyond the business incubator and accelerator phases to the next level of growth.
The New Venture Capital Fund’s goal is to stimulate private sector investment and promote diversification of the economy by supporting a variety of pre-revenue; mid-stage and late stage startup companies. This fund offers a variety of financing options in the form of traditional or convertible debt and equity investment. Updated information should be available in the Fall of 2019 as this program is being revamped by the North Dakota Department of Commerce and Bank of North Dakota to invest more in new and growing primary sector companies.