Happy Holidays and Cheers to 2021


As we prepare to end a year that will no doubt be remembered for many reasons, we’d like to wish you and your families a healthy, peaceful, restful holiday season. We are grateful for the opportunity to grow our Bread & Butter work and family this year and we look to 2021 with great optimism.

Some highlights of 2020:

Growing the Bread & Butter team. We grew our team to three this year with Brett and Mary partnering and growing our investment thesis to add health tech and enterprise SaaS as two core verticals, complimenting our foodtech practice. We are proud of launching with a dedicated Platform effort that Steph is running to tap into our Minnesota backyard as well as our national and global network to support our portfolio companies.

Growing the Bread & Butter family. Through the challenges of Covid-19, we continued to see stronger quality and volume of deal flow than ever before. We made 13 new investments into early stage teams across 7 states who are innovating across the board — from the alternative protein industry to breast cancer market to financial security & wellness to better equipping the manufacturing industry via software. And we know that Covid-19 has transformed the core industries we invest in: how we feed ourselves, how we care for one another, and how we work. We can never afford to underinvest in these areas and we know many great companies are born out of periods of economic constraint. Keep an eye on these companies (and a few still to be announced):

Supporting portfolio momentum. 2020 was a building year for our 40 portfolio companies. Even in the difficult Covid-environment, a number of our companies raised follow-on rounds of capital, won contracts and were recognized as leaders in their fields. We’re tremendously proud of all of our founders including Courtney & Dr. Tye Caldwell from ShearShare who won investment from Google’s Black Founders Fund, Scott Burns from Structural who was recognized by Minneapolis St. Paul Magazine as one of 2020s Most Admired CEOs, to Jasmine Jones from Cherry Blossom who won first place in Fashion Institute of Technology’s Design Entrepreneur Competition. On our side, we focused on fundraising support, biz dev intros, PR amplification, and operational support.

Community Engagement. We doubled down on our efforts to show up in the community and be accessible to entrepreneurs. Each member of our team does weekly office hours every week which you can sign up for here. It’s one of our favorite parts of the week as we have met students, startups, investors, and have made many great personal connections through these. Our virtual zoom journeys have allowed us to participate in almost 100 community events ranging from Disrupt in Pakistan to Food Ag Ideas Week to Luminary Talks with American Underground in Raleigh Durham to The Real Pitch at Twin Cities Startup Week. You can hear more about our story https://powderkeg.com/innovation-creativity-in-minneapolis-startups/ or read more about it here.

At the same time as we look back on 2020, we are also making plans for what will drive us and what we will focus on in 2021. When thinking of what will define our next year, three words come to mind — digitization, growth and connection.

Digitization. We have witnessed rapid digitization across both the food and health value chain. The human adoption necessary to modernize elements of these industries has truly accelerated over the past 9 months and we expect that to push more resources and attention behind the technology pushing these industries forward. A number of our portfolio companies have benefitted from these tailwinds, and we are keeping a close eye on the specific areas of our core sectors that are continuing to digitize as we look at new companies to back. We’re tracking core trends like robotics in foodtech, telehealth within healthtech, and optimizations for better virtual work in enterprise software.

Growth. We are extremely proud that despite the year’s hardships, our portfolio companies saw continued (and in many ways, accelerated) growth. We expect this to only accelerate in 2021. We believe that numerous of our investments across both Funds I and II are poised for significant acceleration in Q1 and Q2 of 2021. Our Fund I companies have scaled revenue cumulatively by more than 11X since we invested. In addition, over the past year we have added 13 new companies to the Bread and Butter portfolio, all of whom are poised for an upcoming year filled with hiring, partnerships and general customer growth. From a platform side, we will be focused on how to encourage and support these companies, and in particular, the people behind the companies, as they continue to scale.

Connection. One of our focus areas of 2021 will be encouraging intentional and meaningful connections on numerous levels. Connections between stellar talent and our growing companies. Connections between our founders for learnings and support. And purposeful, useful connections between the corporate and startup worlds, not only for our portfolio but for the Minnesota startup ecosystem as a whole.

As we prepare to close the books on 2020 in a couple of weeks, and before we dive into the new year head first, we’ll be taking some intentional moments to reflect and reconnect with our teams, families, and friends. We are so grateful for the awesome community support we’re received this year and we look forward to all that is ahead in 2021. Happy holidays!

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