9/17/2015 10:14:43 AM
Minnesota is gaining a reputation as a place where entrepreneurs can get the startup funding they need. For instance, a recent CNET article called Minnesota a "Silicon Prairie" where tech startups can have an easier time getting funding than in Silicon Valley.
Access to capital is key to attracting new business - and that's why it's one of 10 broad measures CNBC examined when it named Minnesota America's Top State for Business in 2015.
Minnesota's finished in the top half among states in this category (23rd). CNBC gave the state 28 points out of a possible 50 points in this category. California and North Carolina tied for first in this category, each with 50 points.
"Companies go where the money is, and capital flows to some states more than others," said CNBC. The network said it looks at venture capital investments by state, as well as small-business lending on a relative basis.
State leaders in Minnesota have been taking action to attract venture capital and improve businesses' access to capital. During the last session, legislators made it easier for startup companies to raise capital in Minnesota by passing an equity crowdfunding bill which Gov. Mark Dayton signed into law in June.
Minnesota companies have attracted about $1.7 billion in venture capital since 2009. By industry, the largest shares of venture capital investment in Minnesota has gone to medical device companies.
But, businesses of all types and sizes have access to funding. In 2014, Minnesota banks lent nearly $571 million to 1,755 small businesses statewide through the Small Business Administration (SBA) loan programs. Minnesota ranks 10th in its volume of SBA-backed loans.
Minnesota's banks are among the nation's strongest and most respected. The state's 317 commercial banks have combined assets of $65.9 billion. Minneapolis-St. Paul has the nation's second-highest concentration of banks, according to the Federal Deposit Insurance Corporation.
In addition, Minnesota's Department of Employment and Economic Development (DEED) oversees a broad range of business incentives that include loans, grants and tax credits. Among these incentive programs are:
On our blog, you'll find a closer look at each of the categories CNBC examined in naming Minnesota America's Top State for Business.
