EDSR INFORMATION 12-13-1994 • k
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TRENDLINES
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Small-town capital
breeds success
Tim Mullen knew he Though small-town Min- get to$5 million, they're not regulations have also hurt
could make a better nesota offers such business ad- interested,"he says. small businesses like his.
hybrid circuit board vantages as low labor costs and Mullen says new banking Given this financing envi-
for hearing aids, but he low manufacturing-space ronment,more and more cities
n ee.° o CARVER '`S n1p and economic-development
couldn't find a venture capital- rental costs, the main reason No,wood Shakopee P
ist who believed him. Mullen wound up in Blue J"'°'Bette Pane °Jordan R` authorities are taking equity
So he searched for other po- Earth was the capital the city s t['' °Arlington
SCOTT New Prague positions in new companies.
tential investors and found offered. °Gaylord o Mullen and four other exec-
people of Blue Earth,Minn., Many start-up businesses ote sucnr°1 ontgomery utives of Hybrid Microcircuits
willing to invest$70,000 in his are forced to outstate Minneso- 3 t t t T l;Centero RICE used to work at HEI,a Victo-
• idea. to because that's where the o, Ulm (St Peter. lE eLEUR F i
ra, Minn.-based firm that
.o.
The Blue Earth Economic money is,Mullen says. °watervitte made small hybrid circuits for
Development Authority took Venture capitalists aren't in- Mankato—.)Mankato other manufacturers.
an equity position in Mullen's terested in a business such as
o Janesville° ,�jWaseca , Mullen left to start his own
fledgling company, issuing Hybrid Microcircuits because ieha BLUE EARTH WAS E C A s T F company because he thought
him a $20,000 low-interest it plans slow,gradual growth to Mapleton° Bloo he could better serve cus-
loan
New Richland° Pr tomers with less turnaround
loan and buying $50,000 sales of about $5 million in n o
worth of preferred stock in the five years. �' 'P5O'°I"ke time,smaller products and cus-
ago° wells°
I business. "What[venture capitalists] ! A R I R A U I T F R F E B O R torn manufacturing.
j Mullen is also leasing a new want is$0 to$50 million in a ( IA
mon•BLUE EARTH Albert Lebo. He expects $400,000 in
.
space in Blue Earth at a low year and a half.If you're talk- I Kesler G sales by December 1993 and
rate,he says. ing about five-year growth to .1_ on' _t $1.5 million for 1994.
10 MINNESOTA VENTURES NOVEMBER/DECEMBER 1993
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