Duke Boosts Local Start-Up Scene

A group of budding entrepreneurs gathered in downtown Durham one recent Wednesday for a lunch of pizza and wisdom. The decidedly un-sexy topic: Trade show booths.

The speaker, a local business leader, offered fine-grained suggestions to the ambitious leaders of start-up companies in attendance — the sort of granular information that someday might provide an edge.

The talk was one in an ongoing series called “Help Fest,” which brings entrepreneurs into the American Underground’s Main Street headquarters for lunch discussions. And like much of the entrepreneurship culture in Durham, it has Duke’s fingerprints all over it.

Help Fest’s funding comes from part of a $20,000 annual grant from Duke’s Innovation and Entrepreneurship Initiative. That grant is one of many ways — some formal, some less so — that Duke contributes money, resources, brainpower and a workforce to the burgeoning entrepreneurship scene blossoming just a couple miles from campus.

The American Underground began in 2010 in a ground-floor office at the American Tobacco campus, providing inexpensive office space to entrepreneurs trying to launch their big ideas. The idea of small, cheap workspaces, month-to-month leases and a hip, intellectually stimulating work environment caught on quickly. American Underground now boasts 150 start-ups operating out of two Durham spaces and a third in Raleigh. It has proven so popular, in fact, that in late July American Underground officials announced plans to double its Main Street space.

“This could not have happened without Duke’s involvement,” says Adam Klein, American Underground’s chief strategist. “You could never build this sort of density and entrepreneurial spirit without a pipeline of great talent.”

Along with financial sponsorship, Klein notes Duke’s involvement in more subtle ways. Many start-ups are run by Duke graduates, some of whom circle back to their favorite professors for mentoring along the way. And many companies hire Duke students as employees or interns.

American Underground uses some of that $20,000 from Duke for an internship program that places Duke students with two or more companies at the same time. Many start-ups can neither afford paying interns nor provide them full-time work but by splitting their time between two or three companies, interns can get varied experiences and make a few bucks.

“And when you intern at a start-up, you aren’t pouring coffee,” Klein notes. “You really do sit in a sidecar with the entrepreneurs and work on real issues.”

Morgan Krey is one of those interns who didn’t spend the summer pouring coffee. The Duke senior worked at NeuroSpire, a Durham-based start-up with the audacious goal of re-wiring the brains of youngsters with Attention Deficit Hyperactivity Disorder using a video game controlled by brain waves.

Heady stuff for a college student? Perhaps, but Krey has always wanted a different experience. As an ambitious 12-year-old growing up in Chicago, he claimed he was 16 in order to caddy at a local golf course. An early growth spurt allowed him to continue this charade for several years, during which time he realized he enjoyed money in his pocket and the flexibility of setting his own hours.

Of course, working at a start-up means working plenty of hours, and Krey put in plenty this summer. He and his colleagues spent untold hours fine-tuning the game, called Neuro+, a flight simulator of sorts in which a player wearing a series of brain sensors controls a glider using only his thoughts. The better the concentration, the further the glider flies. A lapse in concentration means getting devoured by a dragon.

Krey is one of a dozen current fellows in Duke’s Melissa & Doug Entrepreneurs program, one of several initiatives the university uses to spark entrepreneurial thinking in undergrads. He went to NeuroSpire this summer to be a web developer. He was that and a lot more.

“I’ve done a little bit of just about everything around here,” Krey reports after just a couple of months on the team. “I’ve jumped into customer service, when someone calls the office. I’ve done sales a little bit, and I’ve jumped into marketing. You don’t necessarily come into the office in the morning knowing what you’re going to do. It’s kind of triage. And it’s awesome.”

The team’s American Underground surroundings are modest — a glass cube office maybe 15 by 25 feet in all, with little decoration other than a growing pyramid of empty cans of a local fruity carbonated tea product called Mati Energy. Recent Duke alumna Tatiana Birgisson created Mati Energy and developed a business plan for distributing it two summers earlier while at DUhatch, a student business incubator at Duke’s Pratt School of Engineering.

NeuroSpire’s headquarters is one of dozens of such offices housing companies that share common space, furniture, arcade games and cocktails to unwind while hammering away at their various ventures.

“It vibrates,” says Jake Stauch, a former Duke student who left the university to found NeuroSpire in 2010. “We get the benefits of a larger workspace even while we’re small.”

At first, Stauch’s company focused on neuro-marketing, which uses brain-imaging technology to determine a consumer’s product preferences. He has subsequently branched out into the ADHD realm with Neuro+.

NeuroSpire is at a critical juncture these days. Several psychologists and psychiatrists are piloting Neuro+ in their offices now, and Stauch is exploring ways to get the software into schools. He recently secured a new round of seed funding that he hopes will speed development and wide-scale distribution.

It’s exciting and stressful, and an ongoing reminder that the future is constantly subject to change.

“The end of my world is always about 30 days away; that’s about as far out as I can see,” he says. “You always have a long-term plan for how you see things, but that never really happens. Things change so quickly. All it takes is one client saying yes or no to change your landscape.”