March 2004

Cover Story

Round two

Experience spoke loud and clear when Bonnie Baskin went searching for an angel investor in spring 2002 for her new biotechnology company, Mendota Heights-based AppTec Laboratory Services. Despite the sluggish economy, she actually made the process of raising capital look easy.

In less than a year after finalizing AppTec?s business plan, Baskin, 54, landed $14 million in venture capital to build a 75,000-square-foot, $21-million high-tech facility in Philadelphia where AppTec will manufacture bio-pharmaceuticals. The deal was Minnesota?s biggest biotech venture in 2002.

?It was a terrible time to raise money,? Baskin says today. ?Could we have picked a worse time??

However, her years of experience and credibility paid off in her quest for funding. AppTec is Baskin?s second company and a spin-off from ViroMed Laboratories Inc., a medical diagnostic testing firm she launched in 1982 in an 800-square-foot basement in St. Louis Park.

She sold ViroMed?s clinical testing business in May 2001 to Burlington, N.C.-based LabCorp and kept the industrial piece, which became AppTec. At the time of the sale, ViroMed boasted revenue of $36 million. When AppTec was split off, it already had revenue, a strong management team and a staff of 120.

?I was in a very unique situation, becaI had a business already,? Baskin says. ?What I realized was the importance that investment venture capital firms place on the management team. I think one of the most important things to them is that they have the people to be able to implement the business plan. Continue reading →

Letter From the Editor


Suppose you had a party to celebrate your company?s failures, and 400 people came. That?s what David Kristal did several months after he exhorted employees at the Embers restaurant chain to try new ideas. Continue reading →

Back Page

Back page

First David Kristal slowed the cash burn when he joined as CEO to save Embers restaurants, the company owned by his father, Henry Kristal. Then he dug deep for every possible new revenue source, eventually convincing local business tycoon Lyle Berman to finance the start of Augeo, an affinity marketing company. A third new venture, selling franchise rights to Joey?s Only Seafood Restaurants in the United States, targets a fast-growing niche in the food industry. Here?s how he fights to survive. Continue reading →


Tall order

On a rare vacation Eli Khoury found himself relaxing in Mexico, reading a magazine tailored to restaurant owners. In the magazine were some comments that stood out to Khoury from Ray Kroc, the late founder of McDonald?s.

?He basically said that in order for a restaurant to succeed, it has to have a personality that fits the community it is located in,? said Khoury. ?In today?s restaurant world, everything is so cut and dry. So many owners believe if it worked in one location, it will work or has to be run the same in the next location. It doesn?t always work that way.? Continue reading →

Flex time

Kelly Stucco Systems was growing at a tremendous rate, nearly doubling in size each year. But as most small-business owners know, the more you grow, the more you need to invest in the business.

There was little money left for the expensive machinery the plaster manufacturer needed to keep competing. So, the owners of the $1-million company looked into equipment leasing. Continue reading →

Capital access

Take note if you?re a business owner who gets uneasy when approaching bankers: Some of those bankers are entrepreneurs, just like you. A wave of mergers in the banking business has brought new large players to town, such as M&I Bank and Associated Bank. The purchases have also spawned start-up banks, usually begun by executives of the purchased banks who don?t enjoy the big-bank atmosphere. Crown Bank and Venture Bank are two examples in the last few years.

Upsize talked to the latest of these entrepreneurs, Ken Brooks, president, and Leif Syverson, executive vice president, who started Signature Bank in Minnetonka last November, after Century Bank was purchased by M&I in late 2001. They tell how they raised twice the typical equity investment for their bank, and how they?ll try to hit a blistering growth rate, to $40 million in assets this year.
Continue reading →

Business Builders


?Hey, it?s a customer!? exclaims Dilbert?s pointy-hair boss as he sticks his head into a conference room to interrupt a sales call. By the time he?s finished hyping the features of the company?s future product ? while proudly revealing that it will leapfrog the competition ? the customer decides to hold off on buying the current version. The manager?s last words to Dilbert: ?I have to run. Try not to blow the sale.? Continue reading →

Customer service

Not long ago I had to deliver some significant complaints about problems with my mother's care at a local hospital. Continue reading →


The term ?philanthropist? comes from the Greek words for ?love? and ?humanity.? Such a person is rewarded with a sense of personal satisfaction that comes from giving.

Today, philanthropists can find that incorporating charity into their personal and business financial planning strategies can not only offer personal satisfaction, but also tax advantages. Continue reading →


Money alone won?t buy security. Only vigilance, awareness and preparation by your employees will protect your digital assets. Here are steps every company should take. Continue reading →


The headlines these days give the impression that only directors of publicly held companies are the subject of intense scrutiny by shareholders as well as state and federal authorities. Continue reading →



Artist and hair stylist Tammy Ortegon figures she has a captive audience to view her own and other artists? work at The Color Wheel, her new store in south Minneapolis. That?s because the space has two purposes: an art gallery and hair salon. Continue reading →


After Augeo, Embers and Joey?s Only employees moved into new headquarters near University Avenue in St. Paul last August, they didn?t have a budget for artwork. So David Kristal, CEO of all three companies, invited employees to come in on a Saturday for a painting party. Continue reading →


A new program will match 20 women business owners with mentors for a year?s worth of advice. The program starts in March, sponsored by the Center for Women Entrepreneurs, part of Metropolitan State University. Continue reading →


Export management software called Shipping Solutions is getting extra interest as the U.S. government cracks down on companies that sell to the wrong people or countries. So says David Noah, president of InterMart Inc. in Eagan, a seven-year-old company that makes the software. Continue reading →


To many chief financial officers of publicly held companies, the Sarbanes-Oxley Act of 2002 is a hassle. The stricter financial reporting regulations could double the cost of being a publicly traded firm to $2.5 million a year, some say.

But to Ashish Gadnis, the new rules are an opportunity for companies to improve their operational efficiencies. He?s president of Fourth Generation Inc. in St. Paul, which offers a service to help small companies in particular to comply with new information technology controls. Continue reading →

Family business

The second generation of the Truelson family is ascending at the Calhoun Village parcel formerly occupied by Nora?s restaurant. Nora?s was closed in December, to make way for Tryg?s, an ?upscale casual? restaurant that Tryg Truelson says will open in September. Continue reading →


The number of U.S. publicly traded companies to announce plans to go private has steadily risen since the inauguration of the Sarbanes-Oxley Act, according to accounting giant Grant Thornton. Continue reading →

Dear Informer

Owner who’s tired of business needs time to reflect, Informer says DEAR INFORMER: I’m getting so sick of my business. It’s the same thing over and over, yet I’m feeling more anxiety than ever. I feel like I’m hitting the wall. DEAR SICK:When employees can’t stand their jobs anymore, they can always look for another one. Not […] Continue reading →

2-minute meeting

John Francis has just opened his 10th PostNet store, the operation that offers mail, copying and related services. He?s the PostNet area franchisee for Minnesota and Wisconsin, and he stopped by the Upsize booth at the January UpSwing Business Expo event at the Marriott City Center in Minneapolis. Continue reading →



When choosing the right asset manager ? also called a portfolio manager or money manager ? you must first determine what kind of investment strategy you desire for your personal wealth or the assets of your company. Continue reading →