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Traction Capital

SMART CAPITAL STRAIGHT TALK Helping Entrepreneurs and Small Businesses Get What They Want for the Greater Good

Wayzata, MN, USA

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Description

Traction Capital is a Minneapolis-based venture capital and private equity hybrid firm founded by entrepreneurs for entrepreneurs. As of 2026, the firm continues to actively deploy capital from its $40M–$60M Fund II, which was launched in mid-2025 to scale early-stage businesses in Minnesota and the Midwest.

Eligibility

  • Geography: Primarily Minnesota and neighboring Midwest states.
  • Sector: Preference for B2B/B2C tech, SaaS, mobile software, niche manufacturing, distribution, and technology-enabled services.
  • Financial Discipline: Seeks cash-efficient companies with a clear path to profitability.
  • Exit Motivation: Specifically looks for founders motivated to achieve a $25M–$50M exit within 3–5 years. 

Process

The firm utilizes a structured 8-step investment approach inspired by the Entrepreneurial Operating System (EOS) framework: 

  1. Prospecting: Identifying opportunities through a trusted network of investors and EOS implementers.
  2. Due Diligence: Comprehensive legal, IP, financial, and management team analysis.
  3. Structure/Close: Negotiating deal terms and capital structure.
  4. Review/Planning: Defining vision and strategy with a plan for EOS implementation.
  5. Implementation: Execution of the business plan and EOS rollout.
  6. Growth: Accelerating top-line growth and operational improvements. 

Founders can "start the conversation" by applying directly through the Traction Capital website. 

What an Applicant can Obtain

  • Capital: Access to both financial and "smart" capital (strategic guidance).
  • Operational Resources: Hands-on support in sales, marketing, budgeting, and leadership development.
  • Network: Access to a network of 100+ investors, 80% of whom are fellow entrepreneurs.
  • Mentorship: Participation in the EO Accelerator (EOA) program for Minnesota entrepreneurs.