The Story Behind the Explosion of the ‘Startup Capital of the South’

A rapper, a broadcast company, a chamber of commerce, a downtown booster group, a credit union and one of the world’s best known tech companies. This unusual cast of characters is driving Durham, N.C.’s emergence as what CNBC now calls, “the startup capital of the South.”

The fact is, unlikely partners sometimes produce undeniably appealing ideas — whether the ultimate objective is launching a company or re-launching a city.

Durham is a former tobacco and textile boomtown that, like many industrial cities in the 1980s and 90s, fell on hard times. Enter the comeback’s first unlikely player, Capitol Broadcasting Company, which decided to add to its television and radio portfolio a massive and derelict tobacco factory. CBC lovingly turned the old warehouses into office space, which opened the doors to successful companies eager to set up shop near universities such as Duke, NC Central, NC State and UNC-Chapel Hill.

But what about the next generation of innovators? CBC eyeballed a storage basement and somehow found it exactly right for the development of the American Underground, a co-working space for entrepreneurs that might otherwise opt for Silicon Valley or Boston.

The American Underground grew into a 250-company campus and reached well beyond the city’s borders to establish a fruitful association as one of the country’s eight Google for Entrepreneurs Tech Hubs.

Another way to grab the attention of startups, the Durham Chamber of Commerce and Downtown Durham Inc. stepped in with two defining ideas. The Bull City Startup Stampede brought three dozen early stage startups to Durham with the lure of free temporary space and a network of entrepreneurs ready to help. Soon after, The Smofficelaunched, known as the “world’s smallest office,” eventually placing one startup in the front window of a downtown coffee shop.

While Durham’s offbeat approach was now its calling card, the city’s greatest strength was its diversity.

Ranking among North Carolina’s most racially diverse metros, the Bull City boasts a proud history as a southern capital of black finance. The American Underground teamed with community leaders to launch the Black Wall Street networking series, which, among other programs, is designed to fuel good ideas and make sure Durham’s success includes everyone. As has become our custom, the startup community found an unconventional way to celebrate, tapping Professor Toon, the American Underground’s Rapper in Residence, to deliver via video our 2015 annual report.

Many ambitious cities desire a bursting portfolio of startups. But without broad community support, efforts may die on the vine or flame out when the next hot thing arrives.

In Durham, we’ve found that diverse teams with an array of perspectives and skill sets make for both innovative solutions to immediate challenges and sustained success.


Leadership Triangle Bids Fond Farewell to Longtime President Winkie La Force

(Research Triangle) – September 20, 2016 – Winkie La Force, who helped build Leadership Triangle into one of the region’s premiere coaching and engagement platforms for emerging and established business and community leaders, will retire from her role as president in January.

Jesica Averhart, currently community engagement director at The American Underground startup hub, will assume executive director duties by first quarter 2017 after a transition and orientation period.

La Force arrived at Leadership Triangle in 2002 and quickly made her mark. She established an alumni network so that graduates could keep in touch and help bring along new classes. She set and met ambitious fundraising goals. She steadily increased corporate and nonprofit involvement. And she launched the annual Leadership Triangle Awards Gala.

“Winkie is one of our region’s greatest assets and a driving force for the progress we’ve experienced over the past several decades, says Michael Goodmon, vice president of real estate, Capitol Broadcasting Company, and, chair, Leadership Triangle.

“Winkie leaves very big shoes to fill and our board was unanimous that Jes Averhart is the perfect successor to lead this institution into the future. Like Winkie, Jes personifies Leadership Triangle’s values. You won’t find anyone more collaborative, community-minded and action-oriented than Jes.”

Averhart joined the staff of The American Tobacco Campus in 2011 and took on a series of high profile roles. She helped to conceive and launch Mission Post, a corner of the award-winning campus designated as a collaborative space for nonprofits. She helped to organize and execute beloved community events such as the annual tower lighting. In 2014, she moved to the nationally recognized American Underground startup hub where she spearheaded corporate partnerships (with the likes of Google for Entrepreneurs, Fidelity, Coastal Federal Credit Union, Wells Fargo and others) as well as happenings such as Durham’s annual Black Wall Street activities.  

La Force plans to remain active in the Triangle community. Among other adventures, she’ll apply her well-honed leadership skills to exploits involving her roster of four grandchildren.

About Leadership Triangle

Leadership Triangle is a non-profit organization established in 1992 to educate and promote regionalism across the separate communities of the Triangle. It does this through regional and leadership development classes, seminars and awards. We strive to build leadership capacity, cooperation, and networking opportunities across the public, private and civic sector, preserving local uniqueness while acting regionally to deal with issues such as traffic congestion, water quality, housing affordability, open space, school funding, economic and social equity.


Research Triangle: incubator for business

The redevelopment of the American Tobacco campus in Durham, N.C., has helped to change the city’s trajectory and provide a home for entrepreneurs.

Durham, N.C. — It’s hard to imagine now, but the bustling entertainment district in downtown Durham not so many years ago was a decrepit cigarette factory filled with bat dung and pigeon droppings whose last best use was as a practice field for the local SWAT team.

The American Tobacco works were a civic embarrassment by the late 1990s. American Brands had pulled out in 1987, and the home of Lucky Strike and Bull Durham was crumbling. Its demise nearly killed downtown Durham as other businesses fled. It was an eyesore, visible to travelers along the Durham Freeway that passes nearby.

But with the help of a visionary business leader, Durham re-imagined American Tobacco. Since reopening in 2004, the development has been filled to the brim with bars and restaurants, apartments and chic new offices. The handsome home of the city’s beloved minor league baseball team, the Durham Bulls, stands right across the street flanked by attractive red brick office buildings along the outfield walls. The glassy Durham Performing Arts Center opened nearby in 2008. An adjoining Aloft hotel came along last year.

And inside American Tobacco, you can get a glimpse of what’s coming next in the Research Triangle.

American Underground, one of the top entrepreneurial hubs in the country, is here. It’s where young companies take flight. There’s Mati, founded by Tatiana Birgisson, who began brewing her carbonated energy drinks as a Duke University student. Now, she’s selling them in Whole Foods. And there’s Nugget, a maker of foldable couches hatched by a couple of students at UNC-Chapel Hill. And Smashing Boxes, a digital product agency.

The Research Triangle area of North Carolina — with Durham, Raleigh and Chapel Hill at its vertices — has long turned good ideas into business enterprises. World class universities attract an enviable supply of talent. and a range of companies — from startups to Cisco, BASF and GlaxoSmithKline — keep that talent anchored. The Triangle has one of the highest levels of educational attainment in the nation.

Read the entire article HERE.


Let it Bee: A Durham Start-up Works to Save Honey Bees…and Our Food System

I don’t understand most of what Albert Einstein said, but this particular quote seems pretty clear: “Mankind will not survive the honey bees’ disappearance for more than five years.”

Yikes. That’s quite the literal and metaphorical buzz kill.

It wasn’t so long ago that it seemed you’d see a small cluster of honey bees – specifically, European honey bees, or if you’re the scientific type, Apis Mellifera – frantically examining every flower you came across. But if you want to get an idea of what’s happened to honey bees in recent years, just go out and try to take a picture of one. They’re not so easy to find any more.

Experts at the Center for Research on Globalization reported in 2015 that over the previous five years, nearly one-third of the United States’ bee population vanished. And that’s not good for any of us.

“We need the bees,” says Leigh-Kathryn Bonner, founder of Durham-based Bee Downtown. “They’re dying around the world at alarming rates. Every third bite of food you eat is the result of honey bees’ work. Without them, the world would be in a really bad place.”


A really bad place, indeed. And not just because we wouldn’t have honey to make all those breakfast cereals or sweet candies. Bees are one of our planet’s primary pollinators, transferring pollen and seeds from flower to flower, fertilizing plants so they can produce fruits and vegetables. In the US alone, honey bees pollinate about $15 billion worth of crops each year, including all kinds of fruits, vegetables, melons and nuts. Every spring, California’s almond growers truck in half of America’s honey bee population to fertilize more than 80% of the world’s almond supply.

Honey bees even have an impact on meats and dairy products, pollinating crops like alfalfa that feed our nation’s cattle.

Concerns about the future of our food system spurred Bonner to start Bee Downtown, a company that creates and sells rooftop and clear storefront observatory hives in urban locations. Despite what you might assume, bees thrive in cities, with downtown hives serving as feeder populations to rural areas, as newborn queens fly off to start colonies elsewhere.

Continue Reading the Blog HERE


Durham lands among top emerging tech cities to live

$58.8 billion was invested in the US through venture capital in 2015, making it the biggest benefactor of this investment type in the world. That money was invested in everything from financial services to biomedical research. A substantial portion of the money was also invested in America’s world leading technology sector.

While Silicon Valley still dominates the technology landscape when it comes to American investment statistics, emerging cities all over the country are also getting in on the action and creating opportunities for millions of Americans. The New Tech City Index ranks these emerging cities based on a number of metrics including industry wages, employment levels, and average house price (see below for full calculation).

So, where is the best American city to live for tech professionals?

The top 10 cities ranked were:

  1. Denver, CO
  2. Framingham, MA
  3. Oakland, CA
  4. Atlanta, GA
  5. Boston, MA
  6. Austin, TX
  7. Santa Ana, CA
  8. Baltimore, MD
  9. Durham, NC
  10. Boulder, CO

Charlotte ranked No. 17; Raleigh No. 18

View the entire list here

Durham lands among top emerging tech cities to liveMORE INFO

Out of 25 U.S. Cities, Report Names Raleigh-Durham Fourth Most Thriving Startup Ecosystem

The Triangle got a national nod this week for its penchant for digital innovation and thriving local startup ecosystem. Ranked fourth in a national evaluation of America’s best cities to lead the digital economy, Raleigh-Durham stood out for its concentration of dynamic startups leading the charge in health and tech innovation. It fell just behind Boston, San Francisco and Denver. San Diego ranked fifth.  Led by the U.S. Chamber of Commerce Foundation, The and Washington D.C. startup hub 1776, the second annual Innovation That Matters 2016 report includes analysis of 25 US cities. Researchers indexed data sets across a series of city-specific attributes, including: talent, capital, industry specialization, density, institutional connectivity along with cultural statistics. They conducted a comprehensive survey of more than 330 startup leaders.  Researchers also met with public and private industry leaders in each city to evaluate the various environmental conditions contributing to ecosystem leadership. A roster of local startup founders along with leaders from key academic, corporate and civic institutions participated in organized roundtable focus groups to help researchers identify both successes and opportunities for improvement.  In Durham in late January, local participants included: Mason Ailstock, Research Triangle Park; Laura BavermanExitEventAnil Chawla, Archive Social; Kevin Davis andDennis Newman of Duke University’s Office of information and Technology; Chris Heivly, The Startup Factory; Derrick Minor, City of Raleigh; Brett Wolfe, Microsoft; andAdam Klein, American Underground.  That roundtable led researchers to identify the following key levers attracting entrepreneurs to the area: strong openness to new ideas, a high quality of life and a favorable regulatory environment.  “The Triangle ecosystem works because of the low friction between universities, startups and civic entities. There is a long history of collaboration between these different spheres, especially with the creation of RTP, that makes it easy to build and sustain conversations within the entrepreneurial ecosystem,” says Klein, chief strategist of American Underground (ExitEvent’s parent company). “I’d contend that and the density of startups activity in downtown nodes will be crucial to our future success.”  Continue Reading by Clicking HERE


Is a Different Type of Silicon Valley Possible?

DURHAM, N.C.—Downtown, sprawling factories are constant reminders of this city’s past life. A few decades ago these massive buildings were owned by tobacco companies and bustling with blue-collar workers. After the tobacco business contracted in the second half of the 20th century, and factory jobs disappeared or were relocated, the buildings—and much of Durham’s downtown—were abandoned.

Now, the city is in the midst of an ongoing, carefully orchestrated plan to boost the economy. These vast spaces are once again teeming with with jobs and workers, but of a completely different variety: white-collar entrepreneurs hoping to make Durham a major destination for start-up ventures.

This did not happen by chance. After the decline of Durham’s manufacturing, the city found itself in need of a revamped economy. Luckily, it had the tools to build one: massive amounts of open, unused office space thanks to the abandoned tobacco manufacturing plants, low (at the time) property prices, and proximity to illustrious academic institutions. So the local government started courting start-ups. In 2011 the city’s Chamber of Commerce launched programs providing free office space, wi-fi, and start-up advice to new companies. That same year the governor of North Carolina implemented a tax credit for developing businesses in the city, geared toward interactive digital media. The Chamber of Commerce has also offered monetary compensation for opening up businesses in the downtown district, and for creating jobs.

In many ways the city’s push has been successful so far. It’s hard to keep count of the incubators, coworking spaces, networking groups, and facilities meant to cater to entrepreneurs. In turn, the city’s start-up community is producing highly-touted, award-winning companies; Durham-based start-ups won Google’s Demo Day pitch competition in both 2014 and 2015. American Underground (AU), one of the larger start-up incubators in the city and one of nine Google Tech Hubs throughout North America, has seen significant growth. The organization started by hosting 25 startups in 2012, and now has 10 times that number on its current roster. Its businesses have brought in over $29 million in funding and added more than 400 jobs to the local economy, according to the group’s most recent annual report.

Read the entire story HERE.


5 Tech Startups to Watch in Durham, N.C.

The old tobacco town is smoking with tech.

The old tobacco town of Durham is ablaze with tech know-how, home to companies large and small. Many are part of ­American ­Underground, a community by the former campus of the ­American ­Tobacco Co. Here are five to watch.

1. CloudFactory
Cloud-based software and 3,000 workers in Kenya and Nepal power this service, aimed at on-demand tasks, such as video captioning for ESPN and image tagging for Microsoft.

2. CrowdTunes
The app, which allows a venue’s patrons to bid on the music they want to hear, has partnered with bars, universities, and even Applebee’s. Instead of $1 jukebox plays, bids go as high as $24—and users can “nuke” unwanted songs by paying five times a song’s current value.

3. ShoeBoxed
This service combines a human team and automated optical-character-recognition technology to digitize business cards and receipts for more than 1 million people. Its QuickBooks- and Evernote-ready output is intended to streamline expense reports, tax returns, and other back-office mundanities.

4. SoloPro
Founded last year, this no-commission real estate service raised $1.6 million from investors (such as home-improvement giant Lowe’s) to unbundle the home-buying process into à la carte options. A 3% rebate on the purchase (for buyers) and flat fees for typically unpaid tasks (for agents) keep everyone happy.

5. First
Billed as “predictive intel for real estate,” this startup crunches 370 data points (your kids’ age, the car you own, your income) to message you, with a 74% success rate, at the moment you are statistically most likely to seek your first home.


Adam Klein Weighs In on Bull City’s Burgeoning Business Scene

When people talk about Durham, our entrepreneurs are often one of the first things they mention. How did we get here?

Right now is one chapter in a long story of entrepreneurship in Durham. It’s something that’s been a rich part of Durham’s history forever. … People started growing tobacco here, and then it turned out that it smoked really well, and that grew into an unbelievable empire. Move forward 100 years and you have the emergence ofBlack Wall Street, another 85 years later you get Research Triangle Park, and then another few decades later you have American Underground.

Everybody’s trying to get attention right now around entrepreneurs in their city, and part of what we love about this city is that none of that is manufactured. If the economy takes a nosedive, or if something else pops up that’s the next big thing, Durham will continue to be an entrepreneurial town. It is our industry.

What is it that’s drawing businesses to choose Durham, and to stay here?

When entrepreneurs come into Durham, they love the energy that’s here. The energy of great food, great culture, a tech scene that’s booming – all those different pieces they can see and experience that they’re not expecting. Because when you’re flying across country into a relatively small Southern city, most people’s expectations aren’t to see all that here. We have a dynamic environment that’s attracting national attention.

What’s behind the tech explosion here? How did that happen?

While the explosion is recent, the foundational pieces of that have been in the offing for a while. Case in point: Bronto Software, which was just acquired for about $200 million, started at the American Tobacco Campus in the mid-2000s. Everybody sees this story of “wow, that’s tons of money” – well, that story has been in the works for 10 years. They were built in Durham, they were grown in Durham with support from Durham entities, and now Bronto has this incredible story.