Twin Cities entrepreneurs' app Runerra gets trial with Target

Bharat Pulgam is already a serial entrepreneur at 19 years old. So are his young partners in Runerra, a startup coming out of this year's Target+Techstars Retail Accelerator program with a planned trial with the Minneapolis-based retailer.

Runerra is one of five companies that presented last week at the accelerator's DemoDay — basically its graduation ceremony — with a Target offer in hand.

"We believe Runerra is the future of connecting our cities and communities," said Pulgam, who has dropped out of the University of Minnesota so he doesn't have a "safety net" as he and his partners build the company.

Ryan Broshar, who runs the Techstars Retail accelerator, said the third class of companies was impressive and diverse, with more than half of the founders either women or ethnically diverse.

He expects them to have as much success as the first two classes, which resulted in 14 pilots with Target, $50 million in venture capital raised and 300 jobs. Three of those companies have been acquired by larger players in the industry.

Techstars runs boot-camp programs across the country, connecting startup companies with mentors within their industry. The retail accelerator with Target started in 2016.

Other members of this year's class hope to tackle the problem of food waste, both from the supply and consumer side; build a sustainable and fair trade supply stream; and provide the framework for people to buy items they see in videos.

Runerra has built an app that allows people in a dorm or other building to help their neighbors while making a little money on the side. Say you are stopping at a restaurant on the way home from class. You can send a message to other app users asking if they want you to pick something up for them as well, and set a fee for your service. Consumers then pay through the app.

The idea, Pulgam said, is that people within a community can be both buyers and consumers. The pilot with Target takes it further, letting a retailer sponsor the buyer's fee, in this case if they are shopping at the Dinkytown store.

Runerra's leadership team created Runerra specifically to compete in the Target+Techstars Accelerator. All the members are well-versed in the local startup community, and have met either through building other companies or planning events for young entrepreneurs.

Like Pulgam, they are all 19 and chose entrepreneurship over some extracurriculars while at Twin Cities high schools.

Pulgam started his managerial career at the end of his freshman year at Wayzata High School. After two students died by suicide within a week, the district set up a Suicide Prevention Task Force, and he became a member through the student council.

However, he wanted to take efforts further to help eliminate the mental health stigma he had seen at school. The result was Helping Every At Risk Teen, or HEART, a nonprofit that still is active.

"I've always been interested in entrepreneurial things, but I never really had a route to do it," said Pulgam, whose family moved to Plymouth from India when he was 2 years old.

A teacher took note and pushed him in the direction of Catapult, a Chicago business incubator for teen businesses. He and some friends came up with Mxers Audio, a company still in the early stages in Minnetonka, although Pulgam is no longer involved.

Mxers was a finalist in the youth division of the Minnesota Cup two years ago. So was Edupass, a software business started by Sam Lerdahl, chief technology officer of Runerra, when he was a student at Mounds View High School.

The two immersed themselves in Twin Cities Startup Week that year and wanted to build a network for young entrepreneurs that could be complementary to the local startup groups.

Enter Generation.MN, a senior National Honors Society project completed by Pulgam and a group that included Josh Chang, Runerra's chief marketing officer. The group now organizes a youth track during Startup Week.

The three teens all started at University of Minnesota last year, along with Niel Patel, the company's chief operating officer, and Hector Cortes, vice president of marketing.

Pulgam was working on another startup called Vitros after being sick and wondered if there was a way to get lab work done on common ailments before going to the doctor. His friends were helping out, throwing around ideas for Vitros and other companies while planning the Generation.MN track for last week's Startup Week.

One day, one of them stopped at CVS on the way back to the apartment. The group wondered: Would there be a way for someone to contact others in a dorm or other common community to see if anyone else wanted something — and make a few bucks in the process?

Runerra was born. And the group decided to challenge themselves to have a business plan ready to apply to this year's Target+Techstars Retail Accelerator.

They started with a Facebook group, but the real-time aspect of using the social network proved difficult. So they decided to build an app. It was far from what a final product would be. For example, the partners had to use spreadsheets to figure out the financial information and send payments via Venmo.

But it was done by May 7, with enough time for a short trial before the application was due.

"As a young team coming into the program without a ton of experience — we're 19 — the fact the folks here at Techstars took a chance on us means the world to us," Pulgam said.

Over the summer and into this fall, the group developed a much better app, found marketing partners and launched another trial at the University of Minnesota.

The other companies that came out of the accelerator with Target deals: Clicktivated, which allows consumers to shop by clicking on products in videos; Cooklist, an app that uses loyalty-card information so people can find recipes that use what's on hand in the kitchen; Flashfood, an app that allows people to buy food close to its expiration date at a deep discount; and Sozie, which curates user-generated content so consumers can see how an online item looks on someone who is their size.

"Our latest Techstars cohort has developed a number of interesting concepts we're excited to test and explore further," said Minsok Pak, Target's chief strategy and innovation officer.

The retailer also has announced a new business program called Target Incubator, targeted to help Gen Z entrepreneurs like the Runerra team.

Catherine Roberts • 612-673-4292