IQ Magazine - Q2 2014 by Initiative Foundation

2ND QUARTER 2014

BUSINESS

Profits for Nonprofits—Social enterprise harnesses the power of business for social change. Pg. 10

COMMUNITY

Vision Quest—Rush City residents get the training and support their community needs to thrive. Pg. 14

PHILANTHROPY

Land Matters—Real estate gifts help property owners give back. Pg. 18

SPECIAL ANNUAL REPORT EDITION

Generation NEXT Millennials Make Their Mark Pg. 22

Initiative Foundation Quarterly 2ND QUARTER 2014

Contents FEATURES

DEPARTMENTS

27 30

Generation Next

As Baby Boomers retire, the Millennials get set to become our new leaders.

Wise Guides

Executive mentors bring “been there, done that” knowledge to new businesses.

34 Good Work

53 2013 Annual Report A year in review: Learn about the ways in which you helped the Initiative Foundation invest in the betterment of Central Minnesota.

Business:

Profits for Nonprofits — Social

enterprise harnesses the power of business for social change.

A culture of community service is taking hold in businesses across Central Minnesota.

Regional Highlights — Get the latest economic and community development highlights from the 14-county area.

Wired

Stengthening the state’s broadband backbone will bring new opportunities to Central Minnesota.

Initiatives:

Community:

Vision Quest — Rush City residents get the training and support their community needs to thrive. Philanthropy:

Land Matters — Real estate gifts help property owners give back.

38 46

How-to:

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Dear Friends, Neal and I have considered ourselves pretty good parents over the last three decades. But there are a few things we just couldn’t anticipate, especially as it relates to up-and coming generations. Lessons learned from our kids… • Text more, talk less—According to son-in-law Andrew, you’re supposed to send a text message if you want a response. LOL. Welcome to Generation Text! • There’s an app for that—Grandsons Jack and Ben asked me the other day about those big, clumsy folding paper thingies I keep in my car. “They’re maps,” I said. Their faces looked puzzled. Who needs maps when you can turn to your apps? • Click for cravings—Daughters-in-law Melissa and Anna always smile so sweetly when we give them cookbooks as gifts. I’m pretty sure they jump online when the need arises. Keyboard crumbs and smartphone smudges are the new kitchen norm. • On-demand groceries—Speaking of the kitchen, daughter Melanie rarely makes a trip to the grocery store these days. Instead, she orders online and has groceries delivered to her home. Click. Pick. Submit. Done.

VOLUME 13, 2ND QUARTER 2014

Initiative Foundation President | Kathy Gaalswyk Marketing & Communications Manager | Bob McClintick

• Picture this—I suspect there won’t be a big fight when the time comes to divide all the family photo albums I’ve created. (I admit: A little disagreement would be nice.) The kids all carry their photos on their phones.

Art Art Director | Andrea Baumann Photographer | Michael Schoenecker Photographer | Bill Jones

• Generational divide—A senior member of our extended family recently asked if email was open on weekends. After some chuckles and good-natured eye rolls, she was assured that it was, indeed, available 24 hours a day, seven days a week.

Advertising/Subscriptions Advertising Director | Brian Lehman Advertising Manager | Lois Head Advertiser Services | Janelle Breen Subscriber Services | Alyson Twardowski

This edition of IQ Magazine highlights the emergence of the Millennial generation and the ways in which they are influencing and reshaping our communities and the workplace. We also tell the story of Minnesota’s broadband initiative and the power it has to extend connectivity to every corner of the state. And don’t forget to check out our 2013 annual report, also included in this edition. Finally, welcome to Aly Twardowski, the newest member of our communications team. We interviewed her by Skype and closed the deal via text—a very Millennial way of doing business!

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IQ Magazine unlocks the power of central Minnesota leaders to understand and take action on regional issues.

Kathy Gaalswyk and Aly Twardowski (right)

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IQ Initiatives

Regional Investment Highlights BENTON COUNTY

Good grants for good works

The Sauk Rapids-Rice Education Foundation, a permanent fund of the Initiative Foundation, has awarded six classroom mini grants. The grants—covering everything from reading to artists-in-residence to middle school nutrition stations—provide opportunities that go beyond the district’s operating budget. Since inception in 2012, SRREF has awarded $27,500 in grants to district-based initiatives.

CASS COUNTY

Getting a grip on grant writing

A big thank you to the Hunt Utilities Group in Pine River for opening its doors to nearly two dozen Central Minnesotans who took part in the Initiative Foundation’s Thriving Organizations Partnership grant writing workshop. The workshop guided grant writers through the proposal development process while helping them to understand the ways in which they can avoid common grant writing mistakes.

CHISAGO COUNTY

Highway 8 is looking great

CROW WING COUNTY

A day dedicated to careers

An estimated 2,000 area students from 23 participating schools had the opportunity to explore career pathways in March during the Bridges Career Exploration Day at Central Lakes College, Brainerd. The Initiative Foundation helps to sponsor the annual event, which showcases the breadth and depth of Central Minnesota career opportunities.

CASS

WADENA

After two years of road construction through Lindstrom and Center City, traffic is once again rolling and business is bouncing back. The Initiative Foundation provided grants to help ease the pain for businesses along the construction route. And now that the work is done, the community is benefiting and is seeing new growth and smoother traffic flows.

TODD

CROW WING

MORRISON

MILLE LACS

ISANTI COUNTY

Partners in child protection

The Isanti County Sheriff’s Department partnered with the Mille Lacs County Sheriff, local Child Protection departments and Fairview Health Services to establish a regional Child Safety and Advocacy Center in Princeton. The center offers medical, mental and emotional care for victims of child abuse, and provides best-practices training for law enforcement, child advocacy and care providers. The Initiative Foundation provided grant funds to support the regional effort.

BENTON STEARNS

ISANT SHERBURNE

WRIGHT

KANABEC COUNTY

Creating an economic engine

County and Mora city officials are teaming up to explore the creation of a countywide economic development authority. With the help of grant funding from the Initiative Foundation, the county and city have brought in a consultant and have formed a committee to advise leaders on economic development policy, procedures, strategy and business recruitment and retention.

MILLE LACS COUNTY

Leaders in learning

Onamia-area school leaders in March participated in the PreK-3rd Grade Leadership Institute to help create and sustain a supportive environment for young learners. The Initiative Foundation serves as a conduit to the Minnesota Department of Education Office of Early Learning to support and encourage regional participation. The Foundation also helps to coordinate interactive television sites and facilitate Leadership Institute discussions throughout the 14-county region.

6 Initiative Foundation Quarterly ifound.org

Morrison County Record

The Boys & Girls Club of Morrison County is marching toward its $1 million fundraising goal to renovate the former IGA building in Little Falls. Organizers are working with the Initiative Foundation to secure a nonprofit loan for the creation of a “New to You” thrift store at the site. The store will be a separate entity and will pay rent to the club, helping it to become self-sustaining.

Endowment appreciation

The Greater Pine Area Endowment on May 1 sponsored a well-attended donor appreciation event at the Pine City Country Club. Attendees included donors, advisory board members and past grant recipients. The GPAE was created in 1992 as a Turn Key component fund of the Initiative Foundation to develop community resources and to enhance the quality of life in the Pine City area.

SHERBURNE COUNTY

Fundraising workshop full house

The Three Rivers Community Foundation played to a full house during its free April 25 “Grasroots Fundraising” session in Otsego. Attendees of this Initiative Foundation-supported event learned how to identify, recruit and engage donors to support their mission. Presenters also shared strategies for involving board members and volunteers in the fundraising process.

STEARNS COUNTY

A place for homeless youth

Homeless youth in Central Minnesota will have a new option for help this spring with Supportive Housing for Youth. The Catholic Charities transition house near St. Cloud State University offers five long-term beds where youths can stay for up to 24 months and two 90-day emergency shelter beds. There are 340 identified homeless youths in the St. Cloud school district. The Initiative Foundation provided a $10,000 grant to support has outgrown.

PINE

ISANTI

Courtesy Chris Welsch

TODD COUNTY

CHISAGO

URNE

A place for boys and girls

PINE COUNTY

KANABEC

MILLE LACS

MORRISON COUNTY

Rolling on Meals-on-Wheels program

A Todd County Healthy Communities Partnership team is continuing its work to secure the vacant Eagle Bend school for the area’s Meals-on-Wheels program. The program has outgrown the Eagle Bend Senior Center, which provides more than 4,500 monthly meals for distribution in Todd and Wadena counties. The effort is supported by an Initiative Foundation grant.

WADENA COUNTY

Promoting parents, learning

The Wadena County Early Childhood Coalition set new goals for the organization with a focus on increasing parent engagement and family outreach. Objectives include increasing website visits; promoting five specific opportunities for parent learning and engagement; including a parent representative on the Early Childhood Coalition team; and providing three capacity-building events in 2015.

WRIGHT COUNTY

Northagen joins economic development team

The Wright County Economic Development Partnership (WCEDP) in February welcomed new Executive Director Duane Northagen (left) to the team. The WCEDP, the county’s economic development arm and the primary point of contact for existing, startup and relocating businesses, is a frequent Initiative Foundation partner for grant and loan disbursements.

2ND QUARTER 2014

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economy

Profits for Nonprofits Social enterprise harnesses the power of business for social change. TAYLOR STEVENSON: “It’s equally important for nonprofits to focus on the business side of the operation.”

Taylor Stevenson always knew there was a better way to share the Lakes Area Restorative Justice Program’s services with the Brainerd Lakes community. Problem was, he often couldn’t look more than a month out because he was constantly focusing on how to keep his organization’s doors open to provide valuable diversion services for juvenile offenders in the Brainerd Lakes area. “It’s pretty common in our field to really focus on the mission and the work,” Stevenson said. “But it’s equally important to focus on the business side of the operation because, let’s face it, all of the good deeds in the world aren’t going to help you make your payroll.” Increasingly, nonprofits are looking to add a for-profit, mission-related component—think thrift stores, day care centers and consulting services—to help make their organizations more financially sound and less dependent on grants and donations. They’re working to even out the financial dips when funding sources change course and to create a more consistent revenue stream

By Bob McClintick | Photography by Michael Schoenecker

when donations drop, much like they did during the most recent recession. It’s called social enterprise, and it lies at the intersection of business and traditional nonprofits. “Nonprofits are all too familiar with the notion that if they just ran more like a business, they’d be better off,” said Linda Holliday, vice president for organizational development at the Initiative Foundation. “Unfortunately, it’s not quite as simple as that. The bottom line for a nonprofit corporation is about advancing a charitable mission, not achieving financial gain. Our goal is to provide nonprofit leaders with the entrepreneurial skills, tools and professional guidance necessary to create viable social enterprise models that enhance their mission.” The Initiative Foundation’s Financial Resiliency Through Social Enterprise (FRSE) program groups participants into cohorts and offers them a combination of training, technical assistance, professional consultation and first-year planning grants CONTINUED ON PAGE 12

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I’m Misty. I’m an environmentalist. And I work for Minnesota Power. Misty loves to get outdoors and play with her rambunctious grandson, Noah. A senior environmental compliance specialist at Minnesota Power, she majored in environmental studies as a nontraditional student at St. Cloud State. Since her career began at Minnesota Power’s Boswell Energy Center nine years ago, Misty has played a role in the reduction of air and water emissions from the power plant. As someone who lives and works in the region, Misty appreciates the opportunity to reduce mercury and other emissions beyond what federal and state regulations require. “I like being part of that.”

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business, continued

ON THE ROAD TO RESILIENCE of up to $10,000. The program helps nonprofit organizations identify possible opportunities that will generate revenues while helping them to create comprehensive business plans to get these social enterprise activities up and running. The program lead to an “Aha!” moment for Autumn Brown, executive director of the St. Cloud-based Central Minnesota Sustainability Project. Started in 2009 to promote environmental and economic sustainability through community gardening, food sharing and distribution—all with a multicultural focus—the nonprofit routinely fields calls from organizations and businesses seeking guidance in setting up their own community gardening program. “It never really dawned on me that we actually are experts,” said Brown. “We’ve learned things and we know things. And people would pay to learn from us.” And so the seed of an idea began to germinate. Working with FRSE consultant Julie Anderholm, Brown is crafting a business plan that will serve as a roadmap for the Central Minnesota Sustainability Project to package and sell its consulting services to other nonprofits or businesses interested in starting community garden programs. Like any business, it can take organizations one to three years before they achieve profitability and build toward longer-term resiliency with a social enterprise venture. Brown and her team still need to perform market research and feasibility studies and run sales and cost analyses. And they need to think about the ways in which they’ll scale up and package the organization’s consulting services. Stevenson and his team at the Brainerd Lakes Area Restorative Justice Program are busy crafting a service-based business and marketing plan to add fee-based mediation services that they can market to area businesses and government agencies. That effort would complement the program’s primary mission, which is to bring together juvenile offenders, victims and community members to work through a process that heals and restores while holding youths accountable for their actions. “FRSE has completely revolutionized our thinking about how we administer our program,” he said. “We’re reorienting ourselves and becoming a forward-looking organization. I really think this is the next frontier for nonprofits.” 12 Initiative Foundation Quarterly ifound.org

The following organizations are part of the Initiative Foundation’s Financial Resiliency Through Social Enterprise (FRSE) program.

ROUND I • ARC United, St. Cloud—Open a new thrift store that provides job training for individuals with disabilities and access to affordable clothes. • Child Care Choices, St. Cloud—Expand sales of early childhood educational toys and supplies through the Little Learners Depot. • Family Pathways, Cambridge—Bail unsold garments for repurpose and remarketing. • Horizon Health, Pierz—Offer training and consulting services to other assisted-living organizations. • Industries Inc., Mora—Provide job training for the disabled through the creation of a thrift store. • JFHML Friends Foundation, Crosby—Expand the Backstreet Books retail shop. • New Pathways, Brainerd and Cambridge—Develop an adult daycare program in Cambridge. • RREAL, Pine River—Expand a solar thermal manufacturing enterprise.

ROUND II

• Central Minnesota Habitat for Humanity, St. Cloud—Increase sales at ReStore, a home improvement/donation center that sells new and donated furniture, home accessories, building materials and appliances. • Faith in Action for Greater Sherburne County, Becker— Expand thrift store operations in the St. Cloud area. • Lakes Area Restorative Justice Project, Brainerd—Develop market-based mediation services. • Central MN Sustainability Project, St. Cloud—Develop a consulting service to other community garden organizations. • Leech Lake Tribal College, Cass Lake—Open a market-based print shop to expand students’ experiential and entrepreneurial skills. • Pine River-Backus Family Center, Pine River—Explore foodbased enterprise options that complement their food shelf. • Seven County Senior Federation, Mora—Expand and enhance retail thrift store operation.

3 ROUND III

The following organizations have just begun to develop their social enterprise ideas. • Advocates Against Domestic Abuse, Aitkin • ARC Midstate, Waite Park • Helping Hands Outreach, Holdingford • Lakes Area Youth Services Bureau, Forest Lake • Pregnancy Resource Center, Cambridge

community

COMMUNITY CONNECTORS: Pastor David Melin, Rush City Administrator Amy Mell and Jamie Scheffer, an intern with the Economic Development Authority.

Vision Quest Rush City residents get the training and support their community needs to thrive. By John Reinan | Photography by Bill Jones

On a frigid February night, with temperatures stuck in the double digits below zero, 175 of Rush City’s 3,000 residents braved the cold to gather at Chucker’s Bowl & Lounge. To put that number into perspective, it was as if residents of the Twin Cities had packed more than four Metrodomes to capacity. And what brought these hardy souls out of their homes and down to Chucker’s? Not a bowling tournament, or a charity auction, or a meat raffle. No, what had residents of Rush City so excited on that wintry Thursday night was an exercise in community engagement and asset-based planning. Their enthusiasm was the culmination of a careful process nurtured for months by community leaders with the help of the Initiative Foundation. Rush City is the latest Central Minnesota community to take part in the Foundation’s Thriving Communities Initiative. Over the last two decades, roughly 65 communities have gone through the program, which gives local residents the training and support to help them take charge of their own destiny.

Local control “The basic philosophy is folks being able to help themselves,” said Dan Frank, senior program manager for community and economic development at the Initiative Foundation. “You really want to engage local people in planning things and carrying them out. It’s their community. It’s really important that they make the plans and take action.” The program rests on four legs: • Training a core group of leaders to engage the broader community in a visioning process to identify shared goals. • Modest grant money—typically around $20,000—that must be matched by the community. • Ongoing assistance and guidance from Initiative Foundation staff. • Referrals and connections to outside experts and other communities that have gone through the process. Building long-term leadership and initiatives from the inside is the key to successful community development, said Aspasia Rigopoulou-Melcher, Ph.D., director of the planning and community development program at St. Cloud State University. “For a project to be successful, not only the experts need to be involved.” CONTINUED ON PAGE 16

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One sweet success story. The Sauk Rapids Dairy Queen is a hot spot for summer refreshment. For Misty Hahn-Schultz and Holly Lyon, it’s also a dream fulfilled. What began for both as a part-time job at age 15 quickly developed their taste for business, and eventually led to their purchase of the franchise in 2011. The proud new owners believe in doing business locally, so they turned to Farmers & Merchants for financing. Like Misty and Holly, our local roots run deep. And our sweet spot has always been helping small-business dreamers become successful owners. If you, too, have a dream, we’re eager to listen.

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community, continued

“We’ve had farmers, teachers, pastors and business people involved.” Dr. Rigopoulou-Melcher cautioned that small towns and cities need to be realistic about what they can achieve with their own resources. “If they want to attract the next Microsoft to move there, could they do that? Probably not,” she said. “You need to start small so you get the knowledge of organizing, marshaling resources, working together. Then you can gradually move toward more challenging and bigger projects.” That’s what several communities have done after participating in the Thriving Communities Initiative program, Frank said, citing Wadena, Braham and Annandale as places that have used their experience to launch even larger projects.

Community vision Rush City residents are looking at three main areas of focus: quality of life, economic development, children/youth and future workforce. Each core area has a task force charged with developing ideas for the short, medium and long term. Rush City’s core groups presented an initial round of ideas at the city meeting in February, and will use input from the larger group as they whittle down their ideas to a handful in each area.

Community leaders said they’re delighted with the level and quality of community participation in the process. “We’ve had farmers, teachers, pastors and business people involved,” said Amy Mell, the city administrator. “People in transportation, environmentalists.” “It’s not cookie-cutter,” added Mayor Dan Dahlberg. “It’s not the same people looking for the same solutions. We invited the people who are naysayers—and they came, and they were excited.” Dave Melin, pastor of Rush City Baptist Church, is a member of the task force on children and workforce development. “It’s fun to be part of something I don’t have to run,” he said with a chuckle. “But I think the Initiative Foundation people have done a very nice job: setting the expectations, bringing different people together, listening to each other. Even if we don’t agree, we value the other person’s opinion.” Jill Bolejack, a member of the economic development task force, agrees. A native of Rush City, she spent 30 years in California before moving back home seven years ago. “It’s a hard thing to generate a community vision without some sort of framework. So it’s great to have the Initiative Foundation, which knows how to do that,” she said. “It wouldn’t happen in the same way without the Foundation coming in.” Most important, residents are excited about the future of their city. Al Hoffman, a retired trucker and City Council member, can’t wait to see the final results take shape: “Once something comes to fruition, you can look back and say, ‘Geez—we did that.’ ”

STARTING POINT Rush City residents see the value of a bike trail to Rush Lake. As residents of Rush City considered their local assets, one kept coming to mind: Rush Lake, the body of water that gave the city its name. The only challenge is that it’s located three miles from the heart of town and separated from the city by Interstate Highway 35. “It’s a beautiful lake, and it would be wonderful to have a better connection to the city,” said Debbie Dahlberg, a member of the quality-oflife task force.

16 Initiative Foundation Quarterly ifound.org

One idea that’s getting strong consideration is a bike trail between Rush Lake and Rush City. That would fit well into the decisionmaking framework of the Thriving Communities Initiative, which encourages communities to start with smaller projects that can be completed relatively quickly and inexpensively. A project like a bike trail also

lends itself to potential spin-off activities, such as bike rentals, refreshment stands, tackle and bait sales. “Everyone in the community realizes that the lake is a tremendous asset,” said Dr. Rigopoulou-Melcher of St. Cloud State University. “So you enhance that asset to provide access and visibility—not only for the community, but for people from the outside.”

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philanthropy

Land Matters Real estate gifts help property owners give back. FARMLAND FOR THE FUTURE: Siblings Charles Siebenand, Kathryn Kulas, John Siebenand and Mary Ann Kramer (seated in front).

Chic Siebenand was many things to Madison, Minn.—an entrepreneur, a baseball announcer, a City Council member, a family man and more. “I thought he knew everyone in the county,” daughter Mary Ann Kramer said. “And he probably did.” Mary Ann and her siblings, Kathryn, John and Charles, no longer live in Madison, yet through their father’s legacy their connection with the community remains strong. John, a founder of the Madison Marietta Nassau Elementary School Fund and a donor to the Madison Community Foundation, both partner funds of the Southwest Initiative Foundation (SWIF), convinced his siblings to honor Chic and their mother, Marie, with a gift of 116 acres of farmland purchased when the children were young.

This story is the result of a partnership between the Initiative Foundation and the Southwest Initiative Foundation.

18 Initiative Foundation Quarterly ifound.org

By Lawrence Schumacher

“He put us all through college on that farm,” Kathryn said of her father. “It was the best investment he ever made.” Thanks to the family’s generosity, the farmland will be reinvested for even more benefit. Through its partnership with SWIF, the Madison Community Foundation can accept gifts of real estate, including farmland, and provide flexibility on how the gift is structured. Gifts of real estate are becoming more and more common, according to Lynn Bushinger, chief financial officer and treasurer at the Initiative Foundation. They can be an attractive philanthropic strategy for farmland, personal or vacation homes, undeveloped vacant land or commercial property. The Siebenand siblings’ attorney and SWIF worked together to set up what’s called a “retained life estate.” “This unique giving option provided an immediate charitable tax deduction to all four siblings, who retain the right to continue using and receiving income from the property for as long as they live,” said Sherry Ristau, SWIF president and chief executive officer. At the end of their lifetimes, the farmland will become available to the Madison Community Foundation through SWIF’s Keep It GrowingSM program. Cash proceeds from the land’s eventual sale will be used to create the Siebenand Family Memorial Endowment Fund, a permanent fund from which grants will be awarded through the Madison Community Foundation. CONTINUED ON PAGE 20

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Thursday July 4th

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Reserve your parking spot by calling Brainerd Community Action at 218-829-5278 Visit www.BrainerdCommunityAction.org for more information 2ND QUARTER 2014

REAL ESTATE DONATION BASICS How popular is this kind of charitable donation? It is growing in popularity, primarily because there are more tools to help nonprofits with this type of transaction, said Melinda Sanders, director of donor relations for the Central Minnesota Community Foundation. Law changes allow nonprofits to form Limited Liability Corporations and donations of real estate more easily. What are the benefits? Donations of real estate allow people with limited

liquid assets to make a lasting difference in their community. How complicated is the process? The timing varies from property to property and depends on how the donation is structured. A recent appraisal is required and the charity will need to do due diligence. How will I know if a nonprofit will accept my donation? Ask, and have the nonprofit contact the Initiative Foundation for more information.

Opportunities and drawbacks The Initiative Foundation evaluates potential donations of real estate on a case-by-case basis. “They’re more complicated than gifts of cash or stock, so we consult with experts in the field for advice,” said Bushinger. Whether to donate real estate or not depends on the relationship between a client’s goals and their tax situation, said Lee Hanson, principal attorney at Gray Plant Mooty in St. Cloud and an Initiative Foundation board of trustees member. The ideal piece of property to donate would be something in which the value has increased over and above its cost. “If you can donate the property at a fair market value, you never realize the income tax on the capital gain and you take the deduction on the income tax for the donation,” said Hanson. But unlike donations of stocks and other marketable assets, real estate is harder to value accurately, and scrutiny from the IRS is possible if a property’s appraisal is much higher than the price the charity gets when it sells it. However, donors needn’t be afraid of an IRS audit if they have used an appraiser deemed qualified by the IRS, according to Jerry McCarter, who helped to create the Minnesota Real Estate Foundation (MREF), the first organization in Minnesota dedicated to giving real estate to charity.

Flexible options If the idea of donating real estate appeals to you, but you worry about giving away your largest asset, it’s possible to create a more flexible arrangement where only a portion of your land or home will go to

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Who pays the expenses? The donor generally pays the expenses associated with assessment and donation until the sale is complete. The donor may be able to deduct any cash donation paid in addition to the value of the real estate. What if I am missing documentation? Some documents can be recreated or obtained through court proceedings. Legal advice is recommended if documents are missing.

When does my obligation to the property end? The donor’s responsibility ends with the transfer, though often they remain committed to working with the charity until a sale is finalized. Do I have to be present at the time of closing? No.

DONATED!

GIFT OF REAL ESTATE

charity. “Whether it’s pooling funds to endow a community theater or forming a trust to support rural renewal, people are finding novel ways to make meaningful, lasting gifts while reducing their taxes and often providing for themselves,” said Kathy Gaalswyk, president of the Initiative Foundation. “For the donors, these less common ways of giving have opened up a whole world of possibilities. Most donors don’t think they can be as generous as they’d like to be, but with these alternatives they end up making the gift they hoped to make.” Creation of a life estate for residential or agricultural land—which schedules the donation for after the donor’s end of life—can also allow people to enjoy a property for as long as they live while earning an immediate income tax credit. That credit can be significant—up to 50 cents on every dollar donated if the donor is in the top income tax bracket in the year of the donation, Hanson said. Nonprofits receiving a donation of real estate will want to sell it as quickly as possible to minimize carrying costs, Hanson said. If the property is not easily sold, or if it needs an investment to make it attractive to a buyer, it may not be a good deal for the recipient. “Many nonprofits have been burned accepting real estate as a gift,” he said. “You have to understand the asset.” That doesn’t mean real estate donations aren’t an excellent way to give back. “Compared with selling a property, paying the capital gains on it and then donating the remainder, donating the property itself can be a great deal for all sides,” said McCarter. “You just have to know how to do it right.”

Powering Possible. THROUGH FINANCING PARTNERSHIPS The Initiative Foundation’s financing programs power the Central Minnesota economy and Initiative Foundation’s financing programs powerin 20 locally owned creates living-wageThe jobs. In 2013, the Foundation invested $2.1 million Centralthese Minnesota economy create jobs.and created. businesses.the Through loans, nearly 400and quality jobsliving-wage were secured

Direct Business Loan Fund Provides funding for new or expanding companies. Targeted industries include manufacturing, service and value-added agriculture.

Technology Capital Fund Supports emerging technology ventures and helps established businesses integrate proven productivity applications into operations.

Green Business Loan Fund Supports ventures that protect or preserve the environment, reduce or recycle an existing waste stream or reduce energy demand/costs.

Lender Match Program Provides financing to match a primary lending institution’s loan amount for the purchase of equipment or real estate.

Nonprofit Loan Program Provides financing for the creation or expansion of mission-related social enterprise activities.

The Initiative Foundation’s business financing programs meet the “gap” between the financing a local lender is able to provide and the equity the owner is able to contribute. Whether you are an aspiring entrepreneur, a nonprofit with a great idea, an existing business owner or a commercial lender, we’re here to help.

FOR MORE INFORMATION: Visit ifound.org or contact Dan Bullert, business finance manager, at (320) 631-2013 or dbullert@ifound.org.

ifound.org (877) 632-9255 | info@ifound.org | 405 First Street SE | Little Falls, MN 56345 Equal Opportunity Lender, Provider and Employer.

FRANZ VANCURA: “I came to the conclusion that I’d have a better quality of life staying here.”

22 Initiative Foundation Quarterly ifound.org

As Baby Boomers retire, the Millennials get set to become our new leaders.

generatio

By Elizabeth Foy Larsen Photography by Michael Schoenecker

Franz Vancura always thought he’d practice law in the Twin Cities. That certainly was the plan when a Minneapolis law firm hired him in 2011. But when his new employer encouraged the recent University of St. Thomas School of Law graduate to take a year to clerk for a judge before jumping into life as a corporate attorney, Vancura didn’t pursue any opportunities in the metro area. “I applied to any judge north of Brainerd,” said the New Ulm native. Vancura’s interest in the region started when he was young. His family owned property on Little Webb Lake in Hackensack and he had happy memories of fishing and relaxing with friends and relatives on the lake. “I had a real connection with the geography and nature of the area,” he said. When he was hired by Judge John P. Smith in Walker, Vancura packed up his Minneapolis condo and moved to a cabin in the woods on Horseshoe Lake. Most people with big-city ambitions would find the off season at a resort community like Walker a little sleepy. But Vancura thrived, especially after he bought an English Springer Spaniel and spent his weekends walking through the woods hunting grouse and pheasants. “It became harder and harder to justify leaving a place I loved and a community I’d gotten involved in to go back to the Twin Cities,” he said. “I just came to the conclusion that I’d be happier and have a better quality of life staying up here.” At 31, Vancura is at the old end of the generation dubbed the Millennials. Born between 1981 and 2000, the group gets its name from the fact that it’s the first generation to come of age in the new millennium. According to Minnesota Compass, there are 1.5 millennials living in the Land of 10,000 Lakes—200,000 in Central Minnesota. That’s compared to 1.3 million Baby Boomers—the demographic bulge of people born between 1946 and 1964. As the Boomers retire, these young people are crucial to our region’s future.

2ND QUARTER 2014

INVENTING OPPORTUNITIES: Travis and Jen Kelley own and operate JenTra Tools, a Backus-based manufacturer of door levels.

Many Millennials in rural communities will have to start and run their own businesses.

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That’s what Vancura found when he did some research and discovered that there was only one other attorney under the age of 55 with a solo practice in Cass County. So he literally hung out his shingle and founded the Vancura Law Firm, now located in Walker. He immersed himself in the community, joining the Walker Rotary Club and St. Agnes Parish, and learned how to curl. He also took on as much pro bono work as he could handle and raised money for Hackensack’s PAWS and CLAWS Animal Shelter, an Initiative Foundation Turn Key component fund. Locals took note. “Franz was one of the first people to get back to us and say he’d help in any way,” said Betty Thomas, the founder of beekeeping supply company Mann Lake Ltd. and the driving force behind PAWS and CLAWS. “Sometimes you can’t just have older folks who are established. You need to bring in the people with new ideas and listen to them.” Economic development experts agree. “The Millennials are our future leaders, elected officials, employees, company owners and parents,” said Kathy Gaalswyk, president of the Initiative Foundation. “As the Baby Boomers retire, sell their companies and discontinue their public service, this is the next wave of leaders.” Attracting these future leaders to Central Minnesota could be a challenge. An analysis done by the Pew Research Center in Washington, D.C., found that only 14 percent of Millennials live in rural areas nationwide, a marked decline from the 29 percent of Boomers who called small town America home when they were young adults. This challenge is further compounded by the fact that even though Millennials are less

Their Town DIVERSITY:

What Millennials want from where they live.

Millennials are the most ethnically and racially diverse cohort of youth in the history of the United States. In Central Minnesota, the percentage of non-white residents has risen from 4.3 percent in 2000 to 7.4 percent in 2012. Millennials also are more embracing of immigrants than older Americans and appreciate how they add to the culture of their town, whether it’s by opening a new restaurant or just having fresh points of view. In fact, nearly six in 10 Millennials say immigrants strengthen the country, according to Pew Research.

BROADBAND: In addition to having access to anything from Instagram to online shopping, a growing number of Central Minnesota workers are telecommuters. A wired life isn’t optional for Millennials. It’s who they are.

A MORE THOUGHTFUL LIFESTYLE:

Winchester’s research shows that the top three reasons people move to small towns are slower pace of life, safety and low cost of housing. But Millennials also want their town to have amenities that enhance their quality life, from bike trails to farmer’s markets.

inclined to buy a home than older Americans, there’s a housing shortage in Central Minnesota. The good news is that there’s another story beneath these statistics. Research by Ben Winchester, a fellow at the University of Minnesota Extension Center for Community Vitality, actually shows a “brain gain” in rural Minnesota since 1970, comprised primarily of people between the ages of 30 and 49 who, like Vancura, move to rural communities because they are drawn to the quality of life. As Millennials start families, Central Minnesota has an opportunity to capitalize on the region’s natural assets and the fact that our economy is no longer based solely on agriculture. “This isn’t your grandpa’s rural,” said Winchester. “Anywhere between 30 to 60 percent of people in the rural communities are proprietors. A lot of people are independent contractors.”

GENERATION START-UP Like any generation, Millennials have their own perspective on the world, which is often shaped by current events. Hit hard by the recession, they don’t feel the same kind of loyalty to a single employer that their older co-workers do. According to the Pew Research Center survey, about twothirds of all employed Millennials say it is likely they will switch careers sometime in their working life, compared with 55 percent of Gen Xers and 31 percent of Baby Boomers. In fact, many Millennials in rural communities will have to start and run their own businesses. “Millennials will be the most entrepreneurial

“As the Baby Boomers retire, sell their companies and discontinue their public service, this is the next wave of leaders.”

2ND QUARTER 2014

Millennials by the Numbers

percent of Millennials say being a good parent is one of the most important things in their lives.

six in 10

More than Millennials say that families have a responsibility to have an elderly parent come live with them if that parent wants to. By contrast, fewer than four in 10 adults ages 60 and older agree that this is a family responsibility. More Millennials have at least some college education (54 percent), compared to 49 percent of Gen Xers, 36 percent of Boomers and 24 percent of the Silent generation (born during the Great Depression and World War II) when they were ages 18 to 28. Millennials, when compared with previous generations at the same age, also are more likely to have completed high school. Millennials are more likely to be living with other family members (47 percent), such as their parents, than were the immediate two previous generations at the same age (Gen Xers, 43 percent; Boomers, 39 percent).

83 59

percent of Millennials have placed their cell phone on or right next to their bed while sleeping. Among Millennials, 59 percent cite the internet as their main source for news.

generation,” said Jack Schultz, the author of Boomtown USA: The 7 ½ Keys to Big Success in Small Towns. “That’s important because most small towns aren’t going to be able to bring in the next company. We have to grow our own.” Starting a business just made sense to Travis Kelley, the 28-yearold co-founder and owner of JenTra Tools in Backus. After two years of working at a Minneapolis lumber company, the Backus native moved back home to sell doors to lumber yards north of Brainerd. When he noticed that the doors often warped after they were installed, he and his wife, Jen, decided to figure out a solution. “The doors in our factories were always flat as a board,” Kelley said. “If the door is installed properly, it shouldn’t warp.” Seeing an opportunity for a precision tool that takes the guesswork out of door installation, the Kelleys created a prototype using tin, cardboard and a level from Menards. “We used it to put a door in and thought, holy cow, that will work,” said Kelley. As a new company with no track record, the Kelleys weren’t able to get traditional funding for a loan to start their business. But research turned up several local opportunities that turned their dream into reality. An ex-lawyer from Andersen Windows wrote their utility patent pro bono. Business financing from the Initiative Foundation and Crow Wing Power got them on their way. Manufactured in Rogers and assembled in Backus, The CHEATAH door level hit store shelves in 2012 and already has been mentioned on the DIY Network’s “Must Have” list from the International Building Show. They’ve sold 6,000 units and are working toward introducing other tools and breaking into the big box market. Kelley credits much of his success to his hometown. “I have so much support,” he said. “I grew up with these people so I know they always have my back.”

CONNECTORS AND COLLABORATORS This can-do spirit is part of a Millennial’s approach to work in general. It’s not unusual today to hear a Boomer marvel, and sometimes even gripe, about how their Millennial colleague feels entitled to a one-on-one meeting with the company’s president. But there’s a positive spin to that generational stereotype. “Millennials like to be in the loop,” said Diane Tran, the founder of Minnesota Rising, a network for emerging leaders in Minnesota. “People can say they constantly want ribbons and awards, but it’s more that they enjoy human connections. Millennials like feedback, collaborating and working in teams.” That’s not the only way Millennials are changing the way that traditional workplaces operate. “Boomers are into the time clock,” said Chris Fastner, who in his work as the senior program manager for organizational development at the Initiative Foundation oversees the

SOURCE: PEW RESEARCH CENTER

CONTINUED ON PAGE 42

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By Jennifer Vogel | Photography by Andrea Baumann

WISE GUIDES Executive mentors lend “been there, done that” wisdom to new businesses.

COME TOGETHER: Jim and Jesse Grant worked with mentor John Ingleman (center) to develop a strategic plan for Jim’s Electric, their family’s company.

2ND QUARTER 2014

IM’S ELECTRIC IN BAXTER HAS BEEN OWNED AND RUN BY THE GRANT FAMILY SINCE 1976, WHEN IT OPERATED OUT OF A GARAGE AND

COUNTED A CARD TABLE AMONG ITS OFFICE FURNITURE. THE ELECTRICAL CONTRACTOR HAS SEEN GOOD AND ROUGH TIMES, EVEN WORKING THE NORTH DAKOTA Jim Grant

OIL PATCH DURING THE RECENT HOUSING BUST. “IT’S A COMPANY MY FOLKS STARTED,” SAID JESSE GRANT, WHO RETURNED TO BAXTER FROM THE TWIN CITIES MORE THAN A DECADE AGO AND CO-MANAGES THE COMPANY WITH HIS FATHER, JIM.

Jesse Grant

John Ingleman

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As Jesse Grant assumes more responsibility within the business, he is looking for ways to grow it beyond its current 21 employees and take better advantage of technology. He also hopes to develop services to offer during the winter months when construction is slow. But stepping into a company with a history, and especially one owned by family—Grant’s brother works there, too—comes with challenges. It can be hard to escape deeplyworn ruts, and sometimes it seems people know each other a little too well. “When you work with family, communication isn’t

always the greatest,” Jesse Grant said. “We’re all going to the same place, but how do you agree on how to get there?” The Grants needed input from someone outside the company. And that is where the EXECs program at the Brainerd Lakes Area Economic Development Corporation (BLAEDC) came in. Launched in 2012, the program matches clients starting or growing businesses with retired or semi-retired executives who volunteer to share their expertise. These executives might deliver a fresh take on strategy or advice related to finances, hiring

or marketing—all for free. Sometimes the relationship lasts for a single meeting; other times it endures for years. As communities in Minnesota come to rely more on entrepreneurs and small companies to keep their economies going—a trend called “economic gardening”— executive mentor ing services have blossomed as a way to help. About half of all new businesses fail within the first five years, according to the U.S. Small Business Administration, but research suggests that entrepreneurs who utilize mentors fare better. “We recognize that the vast amount of our economic development and future prosperity will come from local entrepreneurs and businesses that are already here and connected to our community and providing good jobs,” said Chris Robinson, BLAEDC’s economic development officer, who coordinates the EXECs program. Several mentoring programs have been around for decades, including SCORE (formerly the Service Corps of Retired Executives), which is national in scope and has seven local chapters. The St. Cloud office—launched

WHY MENTORS MATTER

Mentors tell us what every entrepreneur should know. Make sure you have access to enough money. Entrepreneurs, perhaps due to their optimistic natures, tend to underestimate how much capital they’ll need to start or expand their businesses, often by as much as 50 percent. Write a thorough business plan. Not only will this help you find out if you have enough money, the plan will come in handy if you’re seeking financing from a bank or investors. It’s also the best way to give shape to your idea. Be realistic. Ask for help when you need it. Business owners tend to put in more than 40 hours per week, at least to start. You don’t have to be the smartest person in the room. Surround yourself with people who are sharper and more experienced than you are, in and outside of your field. That includes seeking advice from a mentor.

in 1980 and serving Alexandria, Park Rapids and other nearby cities— offers business workshops as well as the expertise of 60 volunteer mentors. It helped close to 300 people last year. That help sometimes involves conveying hard realities. Workers often want to start companies because they idealize their employers’ lifestyles, said Mert Hubbard, a retired manufacturing executive who until recently was co-chair of St. Cloud SCORE. “The boss is driving a Cadillac and has a cottage in Brainerd,” he said. “You have to help them see that it isn’t that easy. What he or she is doing has taken a lot of hard work and effort and a lot of sleepless nights.”

The EXECs program, with more than 30 volunteers, was launched because of demand not only from entrepreneurs but also the large pool of former business leaders retiring to the Brainerd area. “They say, ‘I’m ready for retirement but not ready to be disengaged,’” Robinson said. The goal is “to partner the desire to give back to the community . . . with our businesses that could benefit from a thirdparty voice.” Last year, EXECs counseled 24 businesses and provided expertise to six community organizations, according to Robinson, who acts as a matchmaker between mentors and businesses. The program also has branched into new

territory, with volunteer executives serving on advisory boards for local businesses and helping with strategic planning and visioning for nonprofits and public entities, including the city of Brainerd. To assist the Grant family, Robinson enlisted John Ingleman, a former chief financial officer at Hutchinson Technology, who recently retired to Lake Margaret. He has worked with Jim’s Electric for a little over a year, focusing primarily on budgeting and strategic planning, pushing them to create a formal business plan that serves as their roadmap. He also helped the family communicate more effectively with each other.

AS COMMUNITIES COME TO RELY MORE ON ENTREPRENEURS AND SMALL COMPANIES TO KEEP THEIR ECONOMIES GOING, EXECUTIVE MENTORING SERVICES HAVE BLOSSOMED AS A WAY TO HELP.

CONTINUED ON PAGE 44

2ND QUARTER 2014

30 Initiative Foundation Quarterly ifound.org

By Andy Steiner Illustration by Andrea Baumann

Muhammad Fareed K. Suri believes broadband internet connections save lives. A stroke neurologist at St. Cloud Hospital, Dr. Suri and his colleagues use broadbandpowered telemedicine to quickly bring specialized, big-hospital care to residents of even the state’s most rural communities. If a patient comes into a participating regional hospital or clinic with stroke-like symptoms, St. Cloud physicians can assess the patient live, through online hookups, within 15 minutes. “Once the local physician has done the exam, our team is hooked up with the patient,” said Dr. Suri. “We can look at the CT scan over the internet. We can look at the labs. We can place the orders at the same time as we are talking to the patient and the patient is speaking to us. It is like we are right there in the room with the patient and the nursing staff.” Called Telestroke, this remote stroke treatment program works well for the regional hospitals and clinics that have been wired to the CentraCare Health system. But there still are parts of the state that do not have broadband services available. Dr. Suri thinks that’s an opportunity waiting to happen.

2ND QUARTER 2014

Courtesy of Andra Johnson, CentraCare Health

ON-SCREEN CONSULTATION: CentraCare stroke neurologist Fareed K. Suri (on screen) works with Dr. Mark Bonneville and registered nurse Steven Schrupp during a telestroke consultation with CentraCare Health-Monticello.

“Border-to-border broadband service would be a great way for us to be able to provide Telestroke to people around the state,” he said. “It’s an essential component of patient care.” Broadband isn’t just improving healthcare in our region. From ecommerce to online learning to telecommuting, communities that have access to high-speed broadband connections have a more flexible economy. If Minnesota wants to compete in a global marketplace, the state must invest in improving its broadband backbone. “High-speed access to the internet is becoming an indispensable infrastructure of our age,” said Michelle Kiley, community and economic development specialist at the Initiative Foundation. “It’s the necessary fuel for vibrant, innovative communities across the state and has become a defining resource much like roads and a strong transportation network were viewed years ago.”

UNEQUAL ACCESS While much of the Twin Cities is blanketed in high-speed broadband (defined by state statute as download speeds of 20-40 megabits per second), internet access remains spotty in the more rural areas of the state, where low population density, tricky geography and high costs make implementation difficult. In fact, just 58 percent of rural Minnesotans have

broadband at home. That’s below the goals set forth by the state to have border-to-border broadband by 2015. Today, Minnesota ranks just 23rd in broadband access and risks being overtaken by other states investing more into their high-speed internet infrastructure. “While the state will most likely not reach its 2015 goal, the importance of this complex and vast issue is evident,” Kiley said. “A unifying need to have access to broadband exists that transcends local, regional and even state boundaries. It has the power to ignite potential in our businesses and our communities. Ultimately, it is an investment in people.” With an eye to the economic and social benefits of broader connectivity, Minnesota philanthropic organizations—including the Blandin Foundation in Grand Rapids and the Minnesota Initiative Foundations (MIFs)—have stepped forward to increase access to broadband in Greater Minnesota. The Initiative Foundation has provided nearly $20,000 in grants to Central Minnesota communities in their efforts to expand broadband access. Some of the beneficiaries include Mille Lacs County, the Region 5 Development Commission and a joint effort involving the city of Mora and Kanabec County. “The goal is to help these areas gain a competitive advantage in the state to better attract people, businesses and jobs,” said Don CONTINUED ON PAGE 47

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Access to high-speed internet will soon be considered an essential feature for homeowners, like electricity or water.

25 30 23 74.5 78 58 30 49.5

Percent of Minnesota households unserved at the lowest broadband service level set in state statute in 2010. Percent of low-income Twin Cities families who do not subscribe to broadband. Minnesotaâ&#x20AC;&#x2122;s rank among U.S. states in access to advanced broadband speeds. Percent of Minnesota households reaching statutory broadband speed goals. Percentage of urban Minnesota households with home broadband. Percentage of rural Minnesota households with home broadband. Percentage of Minnesota businesses that allow teleworking. Percent of rural Minnesota households unserved at state broadband levels.

monthly cost among all state $49.46 Average broadband subscribers. Source: Minnesota Governorâ&#x20AC;&#x2122;s Task Force on Broadband Annual Report 2014

2ND QUARTER 2014

GIVING BACK: Volunteers find a variety of reasons to give back to their communities. Photos courtesy of Catholic Charities, United Way of Central Minnesota, Times Media, Mount Ski Gull and Capital One速 Financial Corp.

34 Initiative Foundation Quarterly ifound.org

By Larry Schumacher

good work A culture of community service is taking hold in businesses across Central Minnesota.

Kelly Werner grew up building Habitat for Humanity homes, helping nuns refurbish their convent and otherwise giving time to help the social good. “It was something my parents did and I just joined in as I grew up,” the 33-year-old benefits account specialist at Mahowald Insurance Agency in St. Cloud said. So when Werner was looking for a job, finding a company that encouraged and facilitated its employees to volunteer was important. “It was a huge selling point in my decision to come here,” said Werner. At Mahowald, employees receive 20 hours per year of paid time to give back to the community on their own, and the company also organizes volunteer activities in which employees can participate. Werner’s desire for a workplace that prioritizes community service isn’t unique. A 2013 Networking for Good report on employee engagement found that at least 75 percent of surveyed employees wanted to be involved in a company’s giving and volunteering programs. And members of the Millennial generation are even more motivated toward doing good as a part of their work. In fact, a Cone Inc. and AMP Agency case study found that 79 percent of surveyed Millennials want to work for companies that care about how they impact or contribute to society. Two thirds said they experienced an increase in loyalty to their employer as a result of workplace-sponsored volunteering.

2ND QUARTER 2014

AT LEAST 75 PERCENT OF SURVEYED EMPLOYEES WANT TO BE INVOLVED IN A COMPANY’S GIVING AND VOLUNTEERING PROGRAMS.

It’s a trend that can have a profound impact on the region’s communities. When an EF-4 tornado ripped through the city of Wadena in 2010, the city was fortunate that a number of local and regional businesses sent employees to help with clean up. “All of Wadena was so grateful to these companies and their staffs for all they did to help us,” said Mayor Wayne Wolden, who is also a trustee at the Initiative Foundation. “I heard so many people say how proud they were that their company sent them.”

A culture of service

Company-sponsored service work is an expanded view of employee benefits that is growing among Central Minnesota companies, said Brian Myres, CEO of Myres Consulting and former managing vice president at ING Direct and Capital One 360. During his time in the financial business, Myres helped build ING Direct’s reputation as a company that cared about helping its neighbors. “People would mention that the reason they joined us was because of the level of engagement we had in the community,” he said. “The benefit for the employee is huge, in terms of job satisfaction, and the effect publicly is also positive for the company.” Facilitating and organizing employee service activities is just as important to a company’s positive image as donating to charity. But first, you have to establish and build a culture of volunteering within the organization—and that

has to start at the top. “It has to come from the CEO, from the leadership, not from the Human Resources department,” said Myres. Myres has been involved in philanthropic work for most of his life, and continued after his retirement from Capital One 360 earlier this year. He’s serving on the search committee for a new dean of the Herberger Business School at St. Cloud State University, on the Central Minnesota Boy Scout Council’s capital campaign, and volunteers as vice president of marketing for the Greater St. Cloud Development Corporation, among other activities. At ING Direct, he helped organize the company’s annual Orange Day of Giving, in which 300-plus employees brought one task from start to completion in a single day to benefit an area nonprofit. A lot of work went into planning those campaigns, and they turned out to be excellent team-building exercises. “It was also great for leadership development,” said Myers. “People who wanted to take on a leadership role within the company would get a chance to lead teams during the pre-planning for the project and during the day.”

A new path

The call to work for the public good can also motivate people to change careers. Dale Bosch owned his own television production company in the Twin Cities, but when his family moved to the Brainerd Lakes area five years ago to be closer to CONTINUED ON PAGE 50

THE CALL TO WORK FOR THE PUBLIC GOOD CAN ALSO MOTIVATE PEOPLE TO CHANGE CAREERS.

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STRIKING A BALANCE:

1 IN 4 AMERICANS VOLUNTEER.

State approves Public Benefit Corporation Act Public corporations sometimes face a dilemma when pursuit of the best return for shareholders conflicts with pursuit of the

64.5 million americans served 7.9 billion hours. Estimate value: $175 billion.

at legal risk if they choose the public good. “It’s shortsighted thinking, because the public benefit is almost

VOLUNTEERING SPANS GENERATIONS

always good for long-term profits, but success is judged on a quarterly basis today,” said the Kevin Lynch, CEO of the Social Enterprise Alliance, a Twin Cities-based membership group for

Volunteer rate

27.4% Teenagers (16-19) 30.1% Generation Xers (born 1965-1981) 90 >> Older Adult 50 >> General Population Volunteer

median annual volunteer rate hours 2012 2012

public good. When that happens, companies put themselves

Median annual volunteer hours (2012)

(65+, highest of any age group)

socially conscious organizations. But that dilemma has been addressed in Minnesota with the adoption of the Minnesota Public Benefit Corporation Act, a bill that became law at the Legislature this year. The bill creates a new corporation status for businesses that allow companies to place public benefit—either general or specific—as a stated objective of the company alongside

VOLUNTEERING AS A PATHWAY TO EMPLOYMENT PERCENTAGE INCREASE IN ODDS OF FINDING A JOB

shareholder benefit, according to Rep. Zachary Dorholt, DFLSt. Cloud. “There’s a growing demand for businesses with a conscience that are not solely profit-driven,” said Dorholt. “This will make it easier for buyers or investors to know that a business is being transparent about its aims.” Benefit Corporations and the officers who lead them can set aside the interests of the shareholders in pursuit of a stated public benefit, without being liable for monetary damages to

27%

Volunteers overall

51%

Volunteers w/o H.S. diploma

55%

Volunteers living in rural areas

VOLUNTEERING SUPPLEMENTS GIVING Volunteers are almost twice as likely to donate to charity as non-volunteers.

the shareholders if they do so. Benefit Corporation legislation is a growing trend and has been enacted in 22 states and the District of Columbia. Dorholt thinks the Benefit Corporation designation may be helpful for several Central Minnesota businesses. “Most people find that doing the right thing is good for longterm profits,” said Lynch. “And many people would like to

40.8% 50.7% 79.2% Nonvolunteers

Overall population

Volunteers

work for a company that does both.” —LARRY SCHUMACHER

PERCENTAGE OF POPULATION WHO DONTATED AT LEAST $25 IN 2012 Source: Corporation for National & Community Service

2ND QUARTER 2014

how to

CHEMISTRY MATTERS: Luke Riordan (second row, third from left) and his staff at DAYTA Marketing.

The Right Hire When it comes to assessing a job candidate, the questions you ask are essential. By Sarah Colburn | Photography by Bill Jones

Potential job candidates at DAYTA Marketing, Luke Riordan’s rapidly growing social media company, can often be found sipping lattes at a local coffee shop or leisurely chatting with existing employees as they tour the offices in St. Cloud. Riordan’s two-day interview process is extensive, and there’s not a single step that hasn’t been thought through. As CEO of DAYTA, he hires more than one full-time employee a month, and has quadrupled his staff in the last year. His company website always shows openings for brand communicators and account managers. Each new employee is expected to develop a high-level relationship with one of the company’s many clients as a way to improve that company’s social media profile. There’s no handholding. Riordan wants to hire the candidate who best fits the company culture and has the needed skill set. That common sense is good for business. An incorrect hire can cost a company one to three times the initial salary for the

position, and that doesn’t include the time, effort and training business leaders may have invested, according to John Fennig, the CEO of DRI Consulting in St. Paul. His company has spent 25 years matching candidates to jobs in the public and private sector. “It’s vital people interview to the job description,” Fennig said. “It’s the recipe you’re cooking or the shopping list you’re going out to acquire. If you deviate a lot, you’re going to come back with the wrong things from the store.” Asking the right questions and creating the correct scenarios is crucial. Riordan, Fennig and other local business leaders offer the following advice:

Look for mastery. Fennig encourages interviewers to dig deep for proof of the skill they’re discussing with a candidate. Tell me how often you’ve eaten fire at a circus? How did it turn out? What do you think of your skill in that area? The answer, he said, is proof of their competency in the skill. CONTINUED ON PAGE 40

38 Initiative Foundation Quarterly ifound.org

Simplifying Lending Micro-loan Fund $1,000 – $35,000

Brainerd Lakes Area

Feeding families around the world...and around the corner.

Million Meal Challenge 2014

Kids Against Hunger–Brainerd Lakes Area is challenging the Brainerd Lakes Area Community to pack One Million Meals for food shelves in North Central Minnesota. We can produce one meal for 25 cents, but in order to do this, we need your help and commitment to raise $250,000 to purchase the ingredients. Please help us feed hungry people right here in North Central Minnesota by donating and volunteering! For more information, call 218-961-0055 or visit www.KidsAgainstHungerMN.org

facebook.com/KAHBrainerd

Revolving Loan Fund $35,000 – $100,000 Septic System & Water Well Loans available to rural land owners Contact Joe Schulte Region Five Business & Loan Developer 218.894.3233 x2 jschulte@regionfive.org www.regionfive.org

Mail a donation to: Kids Against Hunger-BLA, 24489 Hazelwood Drive, Nisswa, MN 56468 Or visit the website to “donate now” or “volunteer your time.”

The Friends of Nisswa Lake Park are raising funds to build the infrastructure for our lakeside park on Nisswa Lake in the City of Nisswa. • 2.3 Acre Park Area • Located across 371 from Downtown Nisswa Square • Swimming Area • Fishing Pier • Boat Slips for Boat Docking

• Walking & Biking Trail connecting to the Paul Bunyan Trail • Pavilion area for weddings and special events • Picnic area • Overlooking Nisswa Lake

For more information contact the Friends of Nisswa Lake Park at lehmanconsulting@nisswa.net; or contact Brian Lehman, Nisswa Mayor, 218-838-4158; Lee Seipp, Co-Chair; 218-821-0362; Erin Herman, Nisswa Elementary School Principal, 218-821-3760; Reed Larson, Nisswa Park Commission, 218-820-5335; Loran Knack, 218-820-5442 or Loren Wickham, City Planner, 218-831-3095

Checks should be made payable to “BLA CommunityFoundation” with a notation of “Friends of Nisswa Lake Park.” Send your tax-deductible donation to The Friends of Nisswa Lake Park, PO Box 262, Nisswa MN 56468.

. a Legacy for Future Generations. Leaving

2ND QUARTER 2014

how-to, continued

“It’s vital people interview to the job description. It’s the recipe you’re cooking or the shopping list you’re going out to acquire.” Ask for work samples. Make sure the candidate knows they will be required to show their portfolio or work samples. If the job is for a top executive position, ask the candidate to prepare a presentation outlining what they’ll do in the first six months to a year on the job. “Make the candidates show their stuff, do a demo, take a test drive—give them an assignment and have them deliver,” Fennig said. “We have people make presentations and do dry runs.” Assess how they assess themselves. Focus on the competencies outlined in the job description and have the candidate rate themselves in each area. What is their skill level? What is their interest level? “Ask them how to fill gaps,” said Fennig. “Not everybody has everything for the job. They may be hoping to get training.”

Go casual. After DAYTA Marketing candidates tour the office, Riordan has them visit with the staff and sit down to coffee with a potential colleague in a more relaxed environment. They also have a one-on-one with Riordan, where he asks questions to get a feel for whether they could become friends with any of the employees they have met. “A lot of people are caught off guard because it has nothing to do with work, your skill set or DAYTA Marketing,” he said. While most candidates answer “yes,” some go on to name and comment about specific team members. “That shows something about their attention to detail and that they can communicate and interact with people,” said Riordan “If they’re able to retain some of that information, that’s always a great sign for me. They care about the person they met. They’re a good listener. You need to be a good listener to be a great communicator.”

Check tech. In her work as the personnel manager at Clow Stamping Company, the Merrifield-based manufacturer owned by Initiative Foundation trustee Reggie Clow, Twyla Flaws has hired more than 100 new people in the last four years. She always asks candidates about technical skills. “The workplace has

40 Initiative Foundation Quarterly ifound.org

changed so much, so it’s important to assess a person’s adaptability and appreciation for technology,” she said. “Everybody learns technology differently, but every workplace requires utilization and adaptability to changing technology and changing jobs.” Do they love technology and change or merely tolerate it?

Don’t forget the tough questions. Flaws also asks interviewees if they’ve ever received a warning at previous jobs. “If they’ve had warnings for poor attendance, then it’s the perfect time for me to say we’re sticklers. The question also gives Flaws the opportunity to ask what caused their challenges—whether it was trouble with childcare, transportation or the shift they were working—and what’s changed to resolve the situation. “It’s life chaos that will cause people to lose their jobs more than performance,” Flaws said. “A lot of employers do a lot of training time but can’t give (training on) social standards or social graces to get through the life bumps.” Seek out scenarios. In her work as a recruiter for Preferred Credit Inc. in St. Cloud, Carissa Schwinghammer draws on situational questions such as, “Tell me about a time this scenario has occurred and what you did, how you responded.” “It creates a context where the candidate shows the reality of the situation rather than an idealized version of what they believe they would do or what they wish they would do,” she said.

Stay focused. Hiring experts agree that a focused and specific approach to interviewing yields the best results. Riordan’s hires are proof. Minnesota Business magazine named DAYTA Marketing one of the Top 100 companies to work for, and those happy employees are most often the result of a good fit from the start. “The ability to communicate your message, whatever that message may be, to another human being is what we do day in and day out,” Riordan said. “You can get the best read of how well a person can communicate by sitting across from them at a table and being face to face.”

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BILL JONES

generation next

KATRINA PIERSON: “People my age don’t want to be tied to a 9 to 5 structure.”

CONTINUED FROM PAGE 26

organization’s VISTA volunteers. “Millennials seem to be more focused on getting the work done,” he said. That’s a generational stereotype that resonates with Katrina Pierson, the 28-year-old partner at HBH Consultants in St. Cloud. “I was 10 when my family got the Internet,” she said. “We are used to being on all the time because technology is part of who we are. People my age don’t want to be tied to a 9 to 5 structure.” That natural ease with technology makes Millennials extremely valuable to their workplaces. As the first generation to view texting, tweeting, and “liking” posts on Facebook and Instagram as everyday parts of life, they understand how to capitalize on social media in a way that might elude their older colleagues. “Technology has given us a new set of tools that can lead to opportunities for innovation and connecting people,” said Tran. “The younger part of the workforce can help make meaning of these technologies.” That doesn’t mean the Millennials entrance into the workforce has not come without bumps. At Mann Lake, Thomas says that her younger employees have learned that when they are at work, they need to keep

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“Millennials like feedback, collaborating

their piercings and tattoos hidden. (Four in 10 Millennials have at least one tattoo, according to Pew Research.) “What they do after hours is up to them,” she said. “But when they are the face of Mann Lake, it has to be our corporate image.” As an employee stock ownership company, Thomas knows that the future of Mann Lake relies on this generation. “In small rural America kids graduate from high school, flee and don’t come back until they are ready to retire,” she said. “We need a reason that they can come back, live, raise their families, enjoy the quality of life we have and offer them a good standard of living.”

ANDREA BAUMANN

and working in teams.”

ON THE COVER: Kimberly Rice sees her tattoos as self expression, but they have caused their fair share of employment woes. She urges people to look beyond the ink to a person’s qualifications.

The

B usiness DocToR • Marketing & Advertising • Business Reviews & Assessments • Business Planning & Development • Management Services & Strategizing • Public Relations & Communications

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2ND QUARTER 2014

STARTUP SUCCESS Mentoring can also be crucial to first-time business owners. When St. Cloud entrepreneur Laura Vogel wanted to open her first business, a franchise of the Apricot Lane Boutique clothing store, she turned to the Central Minnesota Small Business Development Center (SBDC) and its staff of mentors. “Ever since I was a little girl, I absolutely loved fashion,” said Vogel, who got her first look at Apricot Lane while on a trip to Walt Disney World. “I usually take a suitcase along when I go on a family vacation so I can bring the extra clothes home. This time I bought a store instead.” Vogel had the enthusiasm but lacked the essential know-

how. At the SBDC office, which is housed inside St. Cloud State University’s welcome center, she was paired with a consultant who was “right there cheering me on, helping me and guiding me. He made sure I did my homework. He helped me understand the outside pieces that come into play and what numbers are realistic.” Today, less than a year after opening, Vogel has two full-time employees and four part-time employees and plans to open more outlets. Stories like Vogel’s buoy the regional SBDC’s director, Barry Kirchoff. Though his center is one of nine in the state, he has assembled a unique collection of services and agencies for entrepreneurs, including

BILL JONES

WISE GUIDES CONTINUED FROM PAGE 29

WEARING MANY HATS: Apricot Lane owner Laura Vogel along with Barry Kirchoff, director of the Central Minnesota Small Business Development Center, and SBDC Consultant Matt Wells (right).

LegalCorps, which provides free legal advice, SCORE and access to St. Cloud State students, who might work up marketing plans or social media campaigns. His office sees as many as 300 clients per year and launches 20 to 25 new businesses. “We put them through the vetting process,” said Kirchoff. “The failure rate for startups tells me a lot of

people don’t know what they are doing.” The innovation and dedication on display at BLAEDC and both the Brainerd and St. Cloud SBDCs drew the attention and financial support of the Initiative Foundation, which provides annual operating grants to all three organizations. “One of our

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44 Initiative Foundation Quarterly ifound.org

“MY MENTOR MADE SURE I DID MY HOMEWORK. HE HELPED ME UNDERSTAND THE OUTSIDE PIECES THAT COME INTO PLAY AND WHAT NUMBERS ARE REALISTIC.” core priorities is to create and help retain living-wage jobs in Central Minnesota,” said Don Hickman, the Foundation’s vice president for economic and community development. “If you can surround yourself with people who have the skills that complement yours, you can save yourself a lot of pain.”

REALITY CHECKS That was certainly the case for Brenda Eisenschenk, who launched the Sartell-based telecommunications consulting firm Inteleconnect in 2007. In

the past, she had worked for service providers, but had never run her own business. “I didn’t know a whole lot about getting started or where to go,” she said. Heeding advice from a friend, she called the local SCORE chapter, where Mert Hubbard answered the phone. “I’ve used Mert many times, for any major decision I want to run by another ear,” said Eisenschenk. Hubbard helped her navigate the hiring process—she currently employs three people—and also offered advice about a potential business

partnership. “My passion was leading me in one direction,” she said. “My mentor was bringing me to a realistic approach of what that involved. We ended up not doing the deal. And we are comfortable with our decision.” Mentors gain from the relationship, too. Many say it’s rewarding to keep a hand in the business world, remain abreast of trends and issues and to experience the camaraderie of other business executives who consult for the various programs. Hubbard has been mentoring for more than a decade. “When

I was in business, I had other businesspeople mentor me,” he said. “I haven’t forgotten that help I was given.” For John Ingleman, who is assisting Jim’s Electric, mentoring is a way to familiarize himself with Brainerd, where he used to only spend weekends. “I’m able to get connected,” he said. “I’ve been pleasantly surprised at all the neat small businesses and even big ones I didn’t know existed. It’s been a learning process combined with the ability to give a little bit back.”

he help you need. T At your place or ours. For more information about our communities and agencies in the Brainerd Lakes and Pine River area, call (218) 820-8975 or visit good-sam.com/brainerdlakes.

All faiths or beliefs are welcome. 13-G0510

2ND QUARTER 2014

A Quarter Centu ry with BLAEDC

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www.KnifeRiver.com 46 Initiative Foundation Quarterly ifound.org

Brainerd Office and Drive-Up ATM 524 SOUTh 6Th STreeT Baxter Office and Drive-Up ATM 14244 DellwOOD Drive

WIRED CONTINUED FROM PAGE 32

Hickman, vice president for community and economic development at the Initiative Foundation. “Widely available broadband has implications across the spectrum — from healthcare to education to economic and environmental influences right on down to simple quality of life benefits.” While these initiatives are crucial first steps toward connecting our rural communities, experts worry that the digital divide between mostly wired urban areas and isolated rural communities will continue to grow if state lawmakers don’t act to fund rural internet infrastructure improvements. “If you have a broadband connection, it is hard to imagine living without it,” said Bill Coleman, a broadband consultant for the Blandin Foundation. “For an urban person, having our phone calls drop as we travel around might be our biggest technological inconvenience. But for many people in Greater Minnesota, online technology hardly works at all.” Access to high-speed internet will soon be considered an essential feature for homeowners, like electricity or water. Blandin researchers estimate that a fiberoptic broadband connection wired directly into a home raises its value by $5,000. And broadband benefits more than homeowners, Coleman said. “We found that for every dollar spent on broadband there is a 10-1 return in terms of economic activity.”

The top five states for broadband access

The top five stat es in the nation for broadb and speed universally acce ssible to residents and bu sinesses

The top 15 when compared to cou ntries globally for broadband penetra tion

BETTER FOR BUSINESS In Pine City, a town of 3,500 located 65 miles north of the Twin Cities on the Snake River, local city boosters took advantage of a major road project to install a new fiberoptic backbone to homes and businesses in the city and nearby industrial park. Robert Musgrove, president of nearby Pine Technical College, said that city leaders for years had been looking for innovative ways to attract business investors to Pine City. When the Minnesota Department of Transportation announced plans to tear up Highway 61 through the middle of town, they decided to jump on the chance and

THE $20 MILLION BROADBAND DEVELOPMENT FUND, passed and signed into law in May, will serve as a source for one-time grants to businesses, local governments, nonprofits or tribal governments to provide broadband service to underserved areas. Under the new legislation, communities would need a 50 percent match to get funding. The goal is to help underserved areas meet the state speed goals of 10 megabits per second download and 5 megabits per second upload. About three-quarters of Minnesota households have access to the Internet at speeds the state considers adequate. To make that level of service available to everyone would cost as much as $3.2 billion.

CONTINUED ON NEXT PAGE 2ND QUARTER 2014

“We need broadband so we can have quality jobs, so we can offer high-quality education, so we can save lives.”

Serving all of Minnesota and Beyond

install fiber-optic lines during construction. “Since the road was already ripped up, we were able to install a conduit all down Main Street and through the entire city out into the industrial park,” said Musgrove. “We ran a fiber optic cable through that and out to the doorstep of every company in town.” The group spent $147,000 on the project, raised through grants and assistance from the city, county and the college. Musgrove says that nearby communities now look at Pine City with envy. The town weathered the economic downturn, and even attracted Advance Design & Systems, an engineering and design firm that works with Medtronic and Boston Scientific. But despite these successes, it’s a different story a few miles out of town. “There are parts of rural Pine County where you are still back at the dial-up stage,” said Musgrove. “There is not physical access to a land-based system like CenturyLink or a wireless provider. So you’re out of luck. You don’t have to go far out town to be in the hole, so to speak.”

SAVING LIVES Other Minnesota communities have also discovered that it takes innovation to overcome the limitations of geography and improve the quality of life for everyone in the region. Although much of the area 48 Initiative Foundation Quarterly ifound.org

For every dollar spent on broadband, there is a 10-1 return in terms of economic activity.

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surrounding the southwestern Minnesota city of Marshall (population 13,000), is rural, administrators at the 49-bed Avera Marshall Regional Medical Center decided to use their hospital’s powerful T-1 lines to connect patients with providers—thanks to the power of the internet. Today, the facility now offers a variety of telemedicine services for patients, including eEmergency, ePharmacy and eICU, where physicians and other healthcare providers from Avera Marshall can consult with specialists at Avera McKennan Hospital in Sioux Falls, S.D., a university-affiliated teaching hospital about two hours away. The investment has literally been a life saver, according to Avera Marshall President and CEO Mary Maertens: “After the adoption of eICU, we saw a reduction by 70 percent in patient mortality and a reduction in length of stay by 30 percent.” It’s results like these that make economic development experts feel even more strongly about making the case for broadband at the state level. “We don’t want enhanced broadband in Greater Minnesota just so kids can play more video games,” said Bernadine Joselyn, the director of public policy and engagement at the Blandin Foundation and a member of Governor Mark Dayton’s broadband task force. “We need broadband so we can have quality jobs, so we can offer high-quality education, so we can save lives.”

Big enough. Small enough.

2ND QUARTER 2014

good works CONTINUED FROM PAGE 36

Mount Ski Gull has taught more than 30,000 kids to ski in its 51 years. It donated more than $75,000 in memberships to kids to teach them to ski last year. More and more companies—both for-profit and nonprofit—are making serving the public good part of their organizational goals, according to Kevin Lynch, CEO of the Social Enterprise Alliance, a Twin Cities-based national organization with over 1,000 members.

Problem Parts?

aging parents, he switched gears to the nonprofit world, becoming executive director of Mount Ski Gull, which specializes in teaching kids to ski and increasing their health and wellness. The Initiative Foundation was one of Mount Ski Gull’s first grant and loan funders. “I’m not a skier,” he said. “But I was impressed by this community of people who want to help get kids healthy, and the many, many volunteers that have kept this place alive, and I wanted to become part of that.”

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FACILITATING AND ORGANIZING EMPLOYEE SERVICE ACTIVITIES IS JUST AS IMPORTANT TO A COMPANY’S POSITIVE IMAGE AS DONATING TO CHARITY.

A new corporate culture

five areas of well-being the company’s human resources and employee benefits plan will soon formally seek to develop. Many of Mahowald’s business customers are taking note of their approach. “It’s a completely new thing for many employers,” said Werner. “But a lot of employers get that the well-being of their employees is important for the overall health of the company, and they’re learning that it goes beyond just physical wellness.”

achieve

create

imagine

Companies that focus on why they do what they do—that give portions of their profit to fund good works, for example—are growing in number and popularity. “Even within ‘normal’ companies, you’re seeing more flex time, moves toward reducing waste, family-friendly policies and the like,” said Lynch. “It’s just becoming part of the corporate culture.” At Mahowald, social good is one of the

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Annual Report 2013

For the period Jan. 1, 2013 – Dec. 31, 2013

Our Mission Powering possible to help CENTRAL MINNESOTA people build and sustain

Who We Are Created in 1986 by local leaders and The McKnight Foundation, we are one of six Minnesota Initiative Foundations. Through leadership programs, grants and business investments powered by local generosity, we work to strengthen the communities, families and economy of Central Minnesota.

THRIVING COMMUNITIES.

How We Serve The Initiative Foundation is proud to serve the 14 counties of Central Minnesota that include 160 hometowns and two tribal nations, each with its own unique character and local assets. Through generous donations and hard-working hometown initiative we . . . • Provide loans to businesses that create quality jobs. • Award grants to nonprofits, governments and schools. • Build public-private partnerships that lead to action. • Help generous people give back to their communities. • Publish information on local trends and solutions.

405 First St. SE | Little Falls, MN 56345 | (877) 632-9255 | ifound.org 2ND QUARTER 2014

Our Results

Our People Dear Friends, Invested $43.4 million through 904 loans and investments in locally owned businesses

27 Years of Impact 1986-2013

Awarded

704 scholarships totaling

Secured

11,956 living-wage jobs

$623,172

Provided training and assistance to

Made 4,249 grants totaling

$26 MILLION

6,415

COMMUNITY LEADERS

Assisted with the establishment and management of

75 new Turn Key Funds during the past 27 years

Returned Experienced asset growth of

88%

$4.52

We’re delighted with the Foundation’s accomplishments during the past year. With your help, through your commitment and giving spirit, we’ve seen the Foundation’s endowment grow to $44.4 million and total assets reach $60.8 million. That’s real money that gets reinvested in Central Minnesota. For every $1 that comes in, an average of $4.52 goes out to the 14 Central Minnesota counties that we call home. Along the way in 2013 we’ve freshened our brand, launched a dynamic new website with real-time access to hosted charitable funds, and we’ve fortified our business information systems to better serve you. We’ve also welcomed three new members to our 15-member board of trustees: John J. Babcock of St. Cloud, Rick Bauerly of Sauk Rapids and Steve Shurts of Cambridge. The work we do is for you. It’s why we dedicate ourselves every day to effectively balance the Foundation’s investments. We want to help power our economy and create quality living-wage jobs. We want to provide resources and expertise to bring out the best in our communities. And we want to give leaders the tools they need to drive change. Because our goal is simple: We want to make Central Minnesota a destination of choice to live, work and play. Thank you, as always, for your past and future support.

to the region through grants and lending investments

for every $1 given

during the past decade The Initiative Foundation is an equal opportunity lender, provider and employer

54 Initiative Foundation Quarterly ifound.org

Linda Eich DesJardins, Board Chair

Kathy Gaalswyk, President

Board of Trustees “In the year ahead the Initiative Foundation will be making great strides in adding and improving technology—from a video tutorial platform to strengthen economic, community and organizational Linda Eich DesJardins, Chair Eich Motor Company

Larry Korf, Vice-Chair DeZURIK

John E. Babcock The Bank of Elk River

development to business system enhancements that will improve services for new and existing donors.” — Larry Korf, 2014 Board Chair

Foundation Staff John J. Babcock Rotochopper

Mayuli Bales Casa Guadalupe & Catholic Charities

Rick Bauerly Granite City Equity

Kathy Gaalswyk President Kristi Ackley Program Assistant for Organizational Development Kendra Botzek Turn Key Specialist Dan Bullert Business Finance Manager

Charles Black Lance Central Lakes College

Reggie Clow Clow Stamping

Pat Gorham Gorham Companies

Lynn Bushinger Chief Financial Officer & Treasurer Chris Fastner Senior Program Manager for Organizational Development Tammy Fillippi Early Childhood Associate Dan Frank Senior Program Manager for Community & Economic Development

Lee Hanson Gray Plant Mooty

Steve Shurts East Central Energy

Dan Meyer Atomic Learning

Traci Tapani Wyoming Machine

Earl Potter St. Cloud State University

Wayne Wolden City of Wadena

Jolene Howard Information Systems Coordinator & Program Assistant Lois Kallsen Office & Facilities Coordinator Michelle Kiley Community and Economic Development Specialist Terri Konczak Early Childhood Dental Network Specialist Kris Kowalzek Accounting Associate MaryAnn Lindell Executive Assistant Amanda Magnan Organizational Development Assistant Bob McClintick Marketing and Communications Manager

Andrea Goedderz Organizational Development Specialist

Katie Riitters External Relations Assistant

Sharon Gottwalt Business Finance Assistant

Julie Schueller Finance Assistant

Don Hickman Vice President for Community & Economic Development

Alyson Twardowski Communications and Donor Services Assistant

Linda Holliday Vice President for Organizational Development

Sandy Voigt Development Officer Amanda Whittemore VISTA Program Associate

2ND QUARTER 2014

Our Numbers

2013 Financial Summary 8%

Sources of Funds: $13,913,302 Investment Income Grants & Contributions Business Financing Revenue & Repayments Other Operating Revenue

$ 6,523,028 $ 4,167,051 $ 3,075,358 $ 147,865

| | | |

47% 30% 22% 1%

$ 3,569,890 $ 2,796,731 $ 1,141,136 $ 411,555 $ 226,033

| 44% | 34% | 14% | 5% | 3%

21%

39%

Uses of Funds: $8,145,345 Grants, Scholarships & Training Programs Business Investments Foundation Operations Fund Development Special Projects & Other

Training Programs Expenses Incurred* $ 338,332 Volunteers in Service to America Thriving Communities & Early Childhood Initiatives $ 332,970 $ 277,428 Thriving Organizations Partnership TOTAL $ 948,730 *Excludes grants & scholarships

32%

Business Financing Sectors Investment Total

$2,139,302

Manufacturing/Construction Healthcare/Service Technology Retail/Wholesale

3% 2%

39 % 32 % 21 % 8 %

| | | |

$ 827,002 $ 690,500 $ 450,000 $ 171,800

Grants & Scholarships Categories Investment Total

16%

69%

Community & Donor Funds Innovation Fund Early Childhood /Thriving Communities Organizational Effectiveness Economic Opportunity Scholarships

TOTAL ENDOWMENT VALUE

$44.4 million A complete audit report prepared by CliftonLarsonAllen, LLP is available upon request.

56 Initiative Foundation Quarterly ifound.org

$ 2,610,596 69 % | $ 1,803,668 16 % | $ 419,433 5 % | $ 128,486 5 % | $ 130,000 3 % | $ 90,323 2 % | $ 49,250

TOTAL ASSETS

$60.8 million

Our Friends

Giving to— and through— the Initiative Foundation in 2012-2013 Honor Roll Crimson $50,000+ Blandin Foundation Corporation for National & Community Service Morgan Family Foundation Otto Bremer Foundation The McKnight Foundation USDA Rural Development Partner $30,000+ Bremer Banks Connexus Energy County of Cass Stearns Electric Association West Central Telephone Association Principal $20,000+ County of Crow Wing County of Pine County of Stearns County of Wright GNP Company Minnesota Power, an Allete Company Executive $15,000+ County of Morrison County of Sherburne Schlagel, Inc. Leader $10,000+ City of Little Falls City of Saint Cloud County of Benton County of Isanti County of Todd East Central Energy Eich Motor Company Kathy & Neal Gaalswyk Larson Boats, LLC U.S. Bancorp Foundation

Director $7,500+ Arvig Cambridge Medical Center on behalf of Allina Health System City of Baxter Clow Stamping Company Associate $5,000+ AgStar Fund for Rural America / AgStar Financial Services Brainerd Lakes Area Community Foundation Chisago County HRA-EDA City of Elk River City of Monticello City of Saint Michael City of Sartell CliftonLarsonAllen LLP, Saint Cloud Consolidated Telecommunications Company Earl & Christine Potter Falls Fabricating Farmer’s & Merchants State Bank First National Bank of Milaca Lakeland Mold Company, Inc. Marco, Inc. Matt & Jeanne Kilian MINPACK, Inc. NOR-SON, Inc. Peoples National Bank of Mora Pequot Tool & MFG., Inc. Pine Country Bank, Little Falls Rita & Everett Sobania Stern Manufacturing The Hyduke Foundation of the Saint Paul Foundation on behalf of the Peoples Bank of Commerce Entrepreneur $2,500+ Atomic Learning, Inc. BankVista

GOAL!

Bruce & Mary Fogle City of Big Lake City of Brainerd City of Milaca City of Pierz City of Rockford City of Saint Joseph City of Sandstone CliftonLarsonAllen LLP, Brainerd County of Mille Lacs County of Wadena Daniel & Sue Meyer Dave Gruenes DeZURIK, Inc. Gene & Bernie Waldorf Jo & Larry Korf Lee & Jan Hanson LINDAR Corporation Midwest Security & Fire Randall State Bank Investor $1,000+ Bank of the West Citizens State Bank of Waverly City of Albany City of Albertville City of Annandale City of Becker City of Braham City of Breezy Point City of Cambridge City of Clarissa City of Cold Spring City of Crosslake City of East Gull Lake City of Foley City of Lake Shore City of Long Prairie City of Maple Lake City of Melrose City of Menahga City of Mora

56.3%

$1,270,000

Total:

$714,853 Thanks to 231 generous donors, the Foundation has raised nearly $715,000 in endowment contributions, representing more than 55% of our five-year fundraising goal (2012-2016).

City of Randall City of Sauk Centre City of Sauk Rapids City of Staples City of Swanville City of Verndale City of Waite Park Crow Wing Power Dan & Annette Frank Dan Bullert Diamond Tool & Engineering, Inc. Don Hickman & Sandra Kaplan Donlar Construction Happy Dancing Turtle Jan Tenold John E & Nancy Babcock Landmark Community Bank Larry Lundblad Linda Holliday & Harry Brodmarkle McDowall Company The late Fran & Mil Voelker

Minnesota Economic Development Foundation Pat & Carmel Gorham Rotochopper, Inc Sandy Voigt Shelly Funeral Chapels Inc Under $1,000 Alison Edgerton Alpine Cabinetry, LLC Anita & Brad Hollenhorst Barb & Duane Anderson Brian Pederson & Julie Schueller Catherine E. Jackson Central McGowan, Inc. Cheryl A. Key Chris Fastner & Kathy HakesFastner Christopher & Beth Thorson Chuck & Lois Head Chuck & Sharon Gottwalt Continued on next page

2ND QUARTER 2014

Our Friends Continued from previous page

City of Avon City of Backus City of Belgrade City of Bertha City of Bowlus City of Burtrum City of Cass Lake City of Center City City of Chickamaw Beach City of Clearwater City of Cokato City of Eagle Bend City of Eden Valley City of Emily City of Fifty Lakes City of Freeport City of Garrison City of Genola City of Grasston

City of Pillager City of Remer City of Rice City of Rock Creek City of Rockville City of Royalton City of Saint Martin City of Saint Rosa City of Sebeka City of South Haven City of Taylors Falls City of Upsala City of Wahkon City of Walker City of Waverly Core Value Consulting, LLC Dianne C Tuff Dick & Mimi Bitzan Don & Deanna Engen

City of Grey Eagle City of Hackensack City of Hanover City of Harding City of Henriette City of Hewitt City of Hinckley City of Holdingford City of Howard Lake City of Isanti City of Isle City of Jenkins City of Longville City of Montrose City of Motley City of Nimrod City of Onamia City of Otsego City of Pequot Lakes

Return on Investment For every $1 that comes in, an average of $4.52 goes out. From Inception to 12/31/2013

Donations Investments ROI

Per $1 ROI

Benton

434,000

3,502,000

807%

$8.07

Cass

777,000

4,038,000

520%

$5.20

Chisago

380,000

2,552,000

671%

$6.72

Crow Wing

1,529,000

9,586,000

627%

$6.27

Isanti

1,173,000

2,991,000

255%

$2.55

Kanabec

147,000

1,021,000

693%

$6.95

Mille Lacs

639,000

3,799,000

594%

$5.95

Morrison

1,658,000

6,447,000

389%

$3.89

Pine

620,000

3,079,000

496%

$4.97

Sherburne

789,000

4,515,000

572%

$5.72

Stearns

1,926,000

8,380,000

435%

$4.35

Todd

846,000

3,353,000

396%

$3.96

Wadena

2,624,000

5,390,000

205%

$2.05

Wright

575,000

5,100,000

886%

$8.87

TOTAL

14,119,000

63,755,000

452%

$4.52

58 Initiative Foundation Quarterly ifound.org

Douglas Larsen & Cathy Hartle Elizabeth F Larsen Eric Rittmann Gray Plant Mooty James & Wendy Shear James D Muchow Jason Bernick Jeff Fromm Jolene Howard Katie & Tom Riitters Katrina L. Pierson Kenneth & Kristine Kowalzek Kristin Ackley Lee Goderstad Len & Lois Kallsen Lynda Woulfe Lynn & Darren Bushinger Martin & Susan Paradeis MaryAnn & Peter Lindell

Benton 807% Cass 520%

Chisago 671% Crow Wing 627% Isanti 255% Kanabec 693% Mille Lacs 594%

Mike & Connie Wood Municipal Development Group Pamela Mahling Ray & Gwynne Gildow Robert & Marilyn Obermiller Robert & Marsha Bunger Robert McLean Sara E Dahlquist Southwest Initiative Foundation Steve & Katy Botz Tamara Feige Filippi The Moran Family Fund of the Central MN Community Foundation The Whitney Foundation Tricia & John Holig Walter & Adele Munsterman Wayne & Lori Wolden William & Diane Scarince

Morrison 389%

Pine 496%

Sherburne 572% Stearns 435%

Todd 396% Wadena 205% Wright 886%

Our Partners

Loans & Equity Investments In 2013, the Foundation invested $2.1 million in 20 locally owned businesses. Through those loans, 390 high-quality jobs were secured.

Becker Screenprint, LLC—Becker Biomatrix, Inc.—Princeton Bollin Properties, LLC dba Cowgirl Tuff Company—Cokato Cavanmor, LLP dba Netgain Technology, Inc.—St. Cloud Chad P. Nelson Law office, LLC - Lindstrom Collins Brothers Towing of St. Cloud, Inc.—Sartell Economic Development Authority of Little Falls—Little Falls Franconia Restaurant Enterprises, Inc.—Taylor Falls Gateway Manufacturing, LLC dba Salo Manufacturing—Menahga Gloria DeBenedet LLC—St. Cloud

Hashiro Childcare Center, Inc—St. Cloud K & G Property Partners, LLC—St. Cloud KRL Holdings, LLC dba National Precision Machining and Engineering—Sebeka Minnesota Heritage House, Inc.—Little Falls Neal’s Motorsports, LLC—Long Prairie Plug Technologies—Hanover Roden Iron, Inc.—Milaca Sneak Attack’s Games, LLC—St. Cloud Spychala Real Estate, LLC dba Albany Family Dentistry, P.A.—Albany Tusen Tack—Braham

Turn Key Funds The Foundation currently hosts 75 Turn Key component funds, which are local endowments (permanent investment accounts with annual returns) through which donors create legacies of charitable support for current and future generations.

Community Funds Delano Community Foundation (DCF) Greater Pine Area Endowment (GPAE) Isle Area Community Foundation (IACF) Morrison County Area Foundation (MCAF) Rum River Community Foundation (RRCF) Staples-Motley Area Community Foundation (SMACF) Three Rivers Community Foundation (TRCF) Scholarship Funds Alternative Sources of Energy Fund Archie & Isabelle Powell Family Memorial Scholarship Fund (TRCF) Betty Ford Menzel Scholarship Fund Beverly M. Pantzke Scholarship Fund Bob & Pauline Johnson Memorial Scholarship Fund Bob Wright Memorial IFPA Scholarship Fund Holdingford Scholarship Fund Little Falls Scholarship Fund Madden’s Pine Beach Scholarship Fund Pillager Scholarship Fund Shawn Grittner Memorial Scholarship Fund Staples Knights of Columbus-Lloyd & Marion Giddings Scholarship Fund (SMACF) William & Ethel Nelson-Zimmerman Memorial Scholarship Fund ZES Scholarship Fund (TRCF) Donor-Advised Funds Anderson Brothers Family Fund

Bob & Marsha Bunger Endowment Fund Edeburn Family Fund Gaalswyk Family Fund Granite Equity Partners Fund Hanowski Family Fund (MCAF) Jane & Patrick Mitchell Foundation John & Bonnie Schlagel Endowment Josh Richardson Youth Arts Fund (TRCF) Julius & Tracy Kurpius Fund (SMACF) Loren & Kathy Morey Family Fund (SMACF) Mark Wood Foundation (MCAF) Mel & Jeanette Beaudry Fund (TRCF) Quiet Oaks Hospice House Fund Nonprofit Endowment Funds Big Birch Lake Endowment Fund Conservancy Fund of Big Fish Lake Association Fund Conservancy Fund of Roosevelt and Lawrence Area Lakes Association Creating Entrepreneurial Opportunities (CEO) Fund Cuyuna Lakes Education Foundation Fish Trap Lake Endowment Fund Friends of Sherburne National Wildlife Refuge Fund Gull Chain Preservation Endowment Fund Horizon Health Partnership in Life Fund Lake Region Conservation Club Fund (MCAF) Land and Waters Preservation Trust Leech Lake Area Watershed Foundation Longville Area Community Foundation Endowment Minnesota Pioneer Park Endowment Fund

Paws & Claws Animal Shelter Sacred Heart-Knights of Columbus Fund (SMACF) Wright County Historical Society Fund Field of Interest Funds Delano Emergency Family Fund Family Farm Fund Manufacturing Fund of Central MN Committee Advised Funds Crow Wing Environment Protection Advised Fund Nicholas P. Koenig H.E.R.O. Foundation Pillager Education Foundation Sauk Rapids-Rice Education Foundation Thrive Fund Special Projects Oakland Cemetery Fund Sartell Wheel Park Fund Sartell DOGPAC Fund Trees for Wadena Fund Veteran’s Art Project Fund Wadena Regional Wellness Center Fund Business Loan Funds Menahga Loan Fund Princeton Economic Development Loan Fund St. Cloud State University Microlending Fund Todd-Wadena Economic Development Loan Fund Wadena Tornado Relief Loan Fund

2ND QUARTER 2014

Our Partners Grant Awards In 2013, the Foundation awarded nearly $850,000 to 133 organizations in support of their critical services and social enterprise activities in our region.

AccountAbility MN, St. Paul Adult Day Services Inc, Bemidji Allina Associated Foundation, Cambridge Amherst Wilder Foundation, St. Paul Annandale Area Community Team Arc Midstate, St. Cloud Arc United Inc, St. Cloud Baldwin Township, Princeton BestPrep, Brooklyn Park Big Brothers Big Sisters of Central MN, St. Cloud Boys & Girls Club of the Leech Lake Area, Cass Lake Boys & Girls Clubs of Central MN, St. Cloud Brainerd Baxter Youth Center Brainerd Lakes Area Chamber of Commerce Education Association Brainerd Lakes Area Economic Development Corp, Brainerd School District Cass County Economic Development Corporation, Backus Catholic Charities of the Diocese of St. Cloud Center for Nonprofit Excellence & Social Innovation (CNESI), St. Cloud Central Lakes College Foundation, Brainerd Central MN Habitat for Humanity, St. Cloud Central MN Sustainability Project Child Care Choices Inc, St. Cloud Children’s Law Center of Minnesota, St. Paul City of Avon City of Big Lake City of Braham City of Brainerd City of Chisago City of Clearwater City of Foley City of Holdingford City of Howard Lake City of Jenkins City of Little Falls City of Long Prairie City of Longville City of Milaca City of North Branch City of Pillager City of Remer City of Rockford City of Rush City City of Sartell City of Staples

60 Initiative Foundation Quarterly ifound.org

City of Taylors Falls Economic Development Commission City of Waverly Community Aid of Elk River (CAER) Community Grassroots Solutions, St. Cloud Council on Foundations, Baltimore, MD Crow Wing County, Brainerd Cuyuna Range Youth Center, Crosby Dreams United/Sueños Unidos, Long Prairie Eagle’s Healing Nest, Sauk Centre Elk River School District Faith In Action for Cass County, Hackensack Faith in Action Greater Sherburne County, Becker FamilyWise Services, Minneapolis First American Financial Services on behalf of WCEDA, Sebeka Friendship Ventures, Annandale Goodwill/Easter Seals MN, St. Paul Great River Family Promise, Elk River Greater MN Partnership, St. Paul Greater St. Cloud Development Corporation, Greater Twin Cities United Way, Minneapolis Hands Across the World, St. Cloud Happy Dancing Turtle, Pine River Horizon Health Inc, Pierz HOWA Family Center, Walker Industries Incorporated, Mora Isanti County, Cambridge Junior Achievement of the Upper Midwest, Maplewood Kanabec County, Mora Kinship Partners Inc, Brainerd Lakes Area Interfaith Caregivers, Baxter Lakes Area Restorative Justice Project, Brainerd Leech Lake Tribal College, Cass Lake Lutheran Social Service, St. Paul Melrose Lake Improvement Association Metropolitan Economic Development Association (MEDA), Minneapolis Mille Lacs County, Milaca Mille Lacs Health System, Onamia Minneosta Folklore Theater Inc, Walker MN Assistance Council for Veterans, St. Paul MN Council of Nonprofits, St. Paul MN Council on Foundations, Minneapolis Northern Cass Developmental Achievement Center, Inc., Walker Northern Pines Mental Health Center, Brainerd Northern Technology Initiative dba GPS 45:93, Mora Northland Arboretum, Brainerd

Northland Area Family Service Center, Remer Northland Community & Technical College Foundation, Thief River Falls Northwest MN Foundation, Bemidji Onanegozie Resource Conservation and Development Council, Inc., Cambridge Our Saviour’s Lutheran Church, Sebeka Pierz School District Pine City School District Pine River-Backus Family Center Pine River-Backus School District Pine Technical College, Pine City Pregnancy Resource Center of Cambridge, Prevent Child Abuse MN, St. Paul Princeton Area Visionary Committee Regents of the University of Minnesota, Minneapolis Region Five Development Commission, Staples Rise Inc, Spring Lake Park Rivers of Hope, Monticello RiverWorks Community Development Organization, Rockford Royalton School District Saint Cloud Neighborhood Coalition Saint Cloud State University Saint Cloud State University Foundation, Salem Lutheran Church, Deerwood Second Harvest North Central Food Bank Inc., Grand Rapids Seven County Senior Federation, Mora Southwest Initiative Foundation, Hutchinson St. Cloud Technical and Community College, Staples Motley School District Stearns Benton Employment & Training Council, St. Cloud Stearns County Parks, Waite Park Stearns County Soil & Water Conservation District (SWCD), Waite Park Todd County, Long Prairie Tri-County Action Program Inc, Waite Park Tusen Tack, Braham United Cerebral Palsy of Central MN, St. Cloud United Way of Central MN, St. Cloud United Way of Crow Wing & Southern Cass Counties, Brainerd University of Minnesota, Minneapolis University of St. Thomas, St. Paul West Central Economic Development Alliance, Sebeka Wright County Economic Development Partnership, Rockford

Grow yourself. Grow your organization. Visit our website for forum dates and locations, to meet our Discussion Leaders, and to learn more about how the Anderson Center can be used to develop and strengthen leaders and create value in your organization. UPCOMING FORUMS Leading Negotiations Forum, July 14-16 in St. Cloud

Acquire and hone skills and techniques proven to successfully lead negotiations.

Managers’ Forum, September 8-12 in Brainerd

Enhance decision-making and leadership skills, acquire essential management concepts and tools, and gain a broader understanding of operations, marketing, finance, systems and strategy.

Experience it.

www.anderson-center.org | 320.251.5420 IQ Ad -- June 2014.indd 1

5/7/2014 12:40:11 PM

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marconet.com 2ND QUARTER 2014

home made TriLite Stone can manufacture stone in any color. One customer requested robin’s egg blue.

TriLite Stone

Ledgestone, a rugged, thin stone with a contemporary look, is extremely popular today. TriLite’s Mountain Ledgestone is one of its best-selling products.

Howard Lake, Minn.

By Maria Surma Manka | Photography by Bill Jones

Stone makes for a gorgeous and durable facade, whether you’re building your dream home or a storefront for your business. An increasingly popular product on the market is manufactured stone, and that’s where Trilite Stone of Howard Lake is making its mark. TriLite creates manufactured stone for residential and commercial use by combining Portland cement, iron oxide color pigments and lightweight aggregate to create stone-like veneers that can be applied to a variety of surfaces. The fact that TriLite mixes its cement with color — rather than simply applying color to the face of the stone — is one of the brand’s biggest competitive advantages. The result is a product that looks and feels like natural stone and can be installed by carpenters and talented do-it-yourselfers. TriLite’s products are used for exterior walls, interior fireplaces, entertainment rooms and even bathrooms. The Initiative Foundation has provided financing to allow TriLite Stone to introduce new products, expand its production capacity and increase its distribution network. We asked company president Len Przybylski to share the secrets to TriLite’s success.

By mixing color with cement, TriLite’s products stay more vibrant against UV rays and maintain their color even if they get chipped or damaged.

Stone molds made from silicone or synthetic rubber are placed over real stones to capture actual dimensions, depth and texture.

Manufactured stone weighs approximately 10 pounds per square foot, which is about 30-50 percent lighter on average than natural stone.

62 Initiative Foundation Quarterly ifound.org

Machines programmed to precise cement and coloring specifications fill the molds, which are then run down a vibrating line and into an 85–90 degree curing room for setting. The next day they are popped out by hand.

To give a greater sense of natural variety, an accent or facial color may be applied by hand to the mold before the colored concrete is poured.

TriLite Stone sources nearly all its materials from local providers, and only reaches across the border to Wisconsin to procure the coloring elements.

Although they have supplied material for projects around the country, TriLite’s core customer base is the Upper Midwest region and the south-central Canadian provinces.

Przybylski is frank about the health of his industry. “The recession hit us hard, but I’m feeling more optimistic,” he said. “With the economy recovering, more people have the money to improve their home. There’s also enormous potential from commercial customers. I’m seeing more interest from sales reps around the country, and that’s encouraging.”

2ND QUARTER 2014

whereâ&#x20AC;&#x2122;s IQ?

THINK YOU KNOW? Send your best guess to IQ@ifound.org by April 15, 2014. Three winners will be chosen, at random, to receive a $25 GiveMN.org gift card to support the charity of their choice.

HINT: This is the longest covered bridge in Minnesota. Congratulations to everyone who correctly recognized the Olde Tyme Trading Post and Silo Ice Cream shop located on the south side of Motley along Highway 10. The Olde Tyme Trading post is an antique shop with a variety of antiques. (And the ice cream shop is now open for the 2014 season!) Bethany Donlin, Nick Schultz, Dianne Ciesluk, Jill Johnson, and Mike Ernster were the lucky winners of GiveMN.org gift cards.

64 Initiative Foundation Quarterly ifound.org

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IQAd.indd 1

5/12/14 2:51 PM