Minneapolis small businesses finally will get help navigating city-regulatory process

Dan Swenson-Klatt, owner of Butter Bakery Café for 11 years, quit a teaching job to start a hole-in-a-wall eatery on Grand Avenue S. in Minneapolis. In 2012, he moved to expanded space nearby at 37th and Nicollet Avenue S. in a new residential-retail development that replaced a long-shuttered mortuary.

Swenson-Klatt, who invested retirement savings and debt in the business, finally is comfortable. Butter Bakery, which survived a street-overhaul job in its first summer on Nicollet, is cash-flowing. Swenson-Klatt employs up to 20 full- and part-time workers and is making his loan payments. Revenue is growing.

However, he hasn't forgotten the rough early years. And he is a longtime supporter of efforts by the Twin Cities Metro Independent Business Association, the Main Street Alliance of Minnesota and Jewish Community Action to make Minneapolis an easier place to start a business.

"It was confusing and frustrating," Swenson-Klatt recalled of the months he bounced from city office to city office trying to get approvals to open his original bakery and breakfast spot. "I'd get one person who cared, one who didn't and another who would send me to somebody else. I often didn't know what to do. Nobody showed me the big picture of what I needed.

"I was college-educated teacher and helped open schools, so I know something about start-ups. But there were so many levels and layers in getting a small bakery and restaurant open ... you make a misstep and you end up in trouble. For example, nobody at the city told me about [Minnesota] OSHA. They didn't catch up to me until I was opening at the current location. I got involved in this because I've seen other small business owners take a run and give up. Or immigrants who don't know the rules. We can do better."

Earlier this month, Swenson-Klatt joined in a show of unity with other small businesses who had similar stories. They included KB Brown of Wolfpack Promotionals on the North Side; Aisha Wadud and Crystal Larson, who have been hamstrung trying to move their Nura Holistic Massage & Bodywork from south to north Minneapolis; Kayf Ahmed, owner of Capitol Café; and Harvey Zuckman, who ran a family-owned electronics business for decades. He never completely figured out the city licensing-and-zoning matrix, but is good at calling his council member for help.

The gathering at City Hall was to celebrate with Mayor Betsy Hodges and several City Council members an agreement to open a Minneapolis small-business "navigator" office. It should help fledgling businesses with a soup-to-nuts checklist and hands-on coaching to get them through a simpler, streamlined process. It shouldn't cost the city much because several people simply will be redeployed within the city development agency.

"The navigators are intended to be the functional one-stop shop," said Deputy City Coordinator Nuria Rivera-Vandermyde, tasked with setting up the office and a get-to-yes mind-set in regulatory services. "Our navigators will help people navigate city regulations and licenses, and help at different stages, and think through, for example, whether they really need a [beer-and-wine] license, and that expense, or maybe just keep it at a coffee shop.

"We'll assist those who want to start a business understand how and make it easier. Ultimately, we're trying to help people prosper. That's what we're here to do for small business."

Not that the Minneapolis small-business economy is failing. In fact, the city has issued a record number of licenses in recent years, albeit a disproportionate number have been for liquor and food to expanding operators or new, well-capitalized businesses trying to cash in on the booms in Uptown, Lyn-Lake, downtown and North Loop.

A key concern is economically fragile neighborhoods, and stoking the modest rejuvenations along frayed-edged commercial arteries such as West Broadway, East Lake, East Franklin and Central Avenue NE. Those entrepreneurs are disproportionately women, immigrants and minorities with limited capital.

Council Member Andrew Johnson, an IT professional and former small-business owner, pushed for the navigator office. He represents an older neighborhood where tired commercial corners are slowly rebounding thanks to independent enterprises.

Big business and established operators often know how to work the system, employ lawyers or call council members to put pressure on regulatory offices. Small entrepreneurs don't have much clout.

"We need a team of problem-solvers," Johnson said. "We also need a one-page checklist on how to open a restaurant or an auto body-repair shop ... a small-business online portal. This shouldn't be based on who you know."

Marcus Owens, CEO of the Northside Economic Opportunity Network, a corporate veteran who also runs a business incubator on West Broadway on the North Side, said navigating city rules can be overwhelming.

Brown, of Wolfpack, noted that, as small businesses increasingly are owned by immigrants and minorities, it fits the city's commitment to "equity" to help them through incubation to prosperity.

"We know our employees, we care about this community we want to live in a city where everyone can thrive," he said. "The city has work to do to create a better, more equitable environment for small and microbusinesses, especially minority-owned businesses."

Neal St. Anthony has been a Star Tribune business columnist and reporter since 1984. He can be contacted at nstanthony@startribune.com.