Editor’s note: As the Internet roared to life in the 1990s, technology and related businesses began to sprout in Durham where restored infrastructure, such as the American Tobacco campus, and the new pillar of Durham Bulls Athletic Park created the foundation on which a remarkable rebirth is built. Today, look at the ever-evolving results with new buildings and planned ones; revitalized blocks; and scores of new businesses – the result of civic and private sector leaders committed to building a new future for the former tobacco town.

One can’t appreciate a revitalized Durham today without looking back to the late ’90s and remembering a desolate city center. The Internet boom coupled with the rebuilding of the city’s infrastructure and the love of several entrepreneurs for the Bull City triggered a perfect storm of development that turned dead town into boom town. Today’s “New Bull City” series is the story of several entrepreneurs who believed in Durham.

DURHAM, N.C. – The void left by the departure of the tobacco industry left a city center virtually lifeless. The year was 1999, and “it was very much as if Durham itself was not a real city,” says entrepreneur Joe Davy.

We’ve elected to forgo our usual tea and coffee, as it is 10 am and already 90 degrees. We’re swapping conversation about our experiences in Durham, discussing entrepreneurship, and pontificating on the state of venture capital and whether angel investors in the Triangle will become more active.

“There were things here – the Durham Bulls, Brightleaf Square, Duke University, the North Carolina School of Science and Math,” says Davy, “but Durham wasn’t a place that folks would go and park to walk around, go and live, or go and work.”

“It was essentially a zip code that had destinations in it,” says Davy, “but now the conversation has shifted entirely. Durham has been elevated to a world-class city.”

Today, we begin to study the early stages of revitalization in downtown Durham. It’s been a long time coming, says Davy, and I quickly agree.

“There’s people who have been here working for 20 years to make this happen.” Davy is talking about people like developers Christian Laettner, Brian Davis, Tom Nieman, Jim and Michael Goodmon of Capitol Broadcasting, all of whom he credits by name for their work and impact.

“They’ve been here working in the trenches to make this place a success.”

It is the entrepreneurs of Durham, Davy says, entrepreneurs like him, who have been beneficiaries of the perseverance of all of the folks who believed in Durham when it was in the middle of a “20-year Detroit-level economic recession.”

“It’s the people, and the heritage of Durham,” said Davy, “that keeps people engaged.”

Who are Durham’s early success stories? Who has helped to catalyze the growth of Durham, attract entrepreneurs and creative professionals, and all the while, help Durham maintain its quirky, historic and gritty nature?

The Young Entrepreneur Who Believed in Durham

“I love North Carolina,” Jud Bowman tells me to start our conversation, “I’ve lived here my whole life.”

You can tell, just by talking to him. Bowman has started two companies here, and has faced tough decisions about staying located in North Carolina and in the Triangle.

Bowman graduated from the North Carolina School of Science and Mathematics (NCSSM), located in Durham’s historic Watts-Hillandale neighborhood in 1999, the same year that he co-founded Pinpoint Networks. He’s been in Durham ever since.

“Durham has changed so much,” said Bowman, “when I came out of the dorm at NCSSM, the center of Durham wasn’t American Tobacco, it was on Meridian Parkway.” The office center, located at the intersection of Interstate 40 and NC-55, housed Pinpoint Networks, OpenSite Technologies, and Red Hat. “Meridian Parkway was the place,” said Bowman, “You’ve got to understand, at that point in time, there were still barbed wire fences around American Tobacco, and Main Street didn’t connect Brightleaf Square and downtown Durham.”

As president and CEO of Pinpoint Networks, Bowman built the company over a four and a half year period, and oversaw a merger with PowerByHand in 2004 to create Motricity, which grew to a $100 million company.

Motricity, said Bowman, became one of the first tenants at American Tobacco. “When we first came over in 2005 and toured McKinney, it was such a visionary project that we wanted to be a part of it.” Motricity acted quickly, renovating the Hill Warehouse, and moving headquarters to downtown Durham. Bowman continued to grow the company, which at its peak, housed more than 250 employees in the building.

This meteoric rise from student to CTO and director of a company which raised $50 million in its IPO and attracted more than $400 million in venture capital in the decade before its IPO sparked a community of entrepreneurs and entrepreneurial activity in Durham and in the Triangle.

In March of 2008, Motricity announced that it would move headquarters to Seattle, and lay off 250 employees. Bowman, as a director, had participated in the conversations and voted on the decision.

“It’s the toughest thing I’ve ever gone through,” said Bowman, who voted against the move. “I voted with my feet, I voted no. And it was hard to live with that, it was extremely scary.”

Two of Bowman’s mentors, including fellow Motricity board member Steve Nelson, the only other “no” vote on the Seattle decision, encouraged Bowman to stay in the Triangle, and encouraged him to start a new company, pledging their support.

“The idea I had was to build a platform around apps – to build an app marketplace,” said Bowman, who purchased a division of Motricity and started Appia. “I got really lucky,” said Bowman, who after the layoffs took effect, “had the opportunity for me to hire some of the folks we had worked with.”

And, according to Bowman, the folks who were laid off by Motricity have done well for themselves. “All of those people have recycled,” said Bowman, “They’ve landed at Appia, at Bandwidth.com, at Netsertive. And they’re all contributing to the growth of the startup community.”

Clearly, voting with his feet has paid off. Appia is now the world’s largest open app marketplace, and in April, the company closed a $5 million round of funding, bringing the total to $33 million raised in the company’s five year history.

Through it all, Bowman has seen Durham become “the center point” of the Triangle. “If the Triangle were a stock,” said Bowman, “you’d be buying it.”

The Executives Who Saw A Vision

Brad Brinegar moved from Chicago to Durham in 2002, taking the helm at advertising agency McKinney, just as McKinney was beginning to search for new office space.

“Brad, as our new CEO,” said Joni Madison, chief operating officer of McKinney, “came in to the market very objective. He asked me if there was any reason that I thought we should limit the search to Raleigh?”

Madison’s answer was that she could not. “As we began the search, we looked at the Triangle as a whole,” said Madison.

The goal, said Brinegar, was to find an office space that “created the right destination and the right environment.”

“While Raleigh is a delightful town, back then, it only felt like the state capitol,” said Brinegar, “It was more of a government town than a creative community.”
In the fourth quarter of 2002, Madison set up a tour with Jim Goodmon, to walk through the American Tobacco complex. “To call it dilapidated,” said Madison, “would be a charming way to put it.”

“There was gravel where the water tower now stands,” remembered Brinegar, “It looked like a factory which had been abandoned for fifteen years.”

“Trees were still growing out of the roof,” said Brinegar. The facility needed work, that much was clear. “I literally threw away my shoes after the walk through,” said Madison. Yet, there was something appealing about Durham.

“We loved the vibe of the town,” said Brinegar, “So it was, to us, the most cosmopolitan place with the best vibe in the Triangle.”

Brinegar and Madison weighed their decision. They enjoyed Durham and its community. “There was a lot of promise with what was happening in Durham,” said Madison.

In meetings with community leaders and city government, “we could tell there was a clear vision that Durham would become a creative city,” said Brinegar. “They were all so aligned in this vision that there was a decent chance it could happen.”

They elected to move to Durham, and to be an early tenant at the American Tobacco Campus.

In making the decision, said Brinegar, “I was really trusting Jim [Goodmon], based on his track record, to build an awesome environment.” At the time of their decision, “it was obvious that American Tobacco would be a pivotal moment, a revolution for the area,” said Madison.

They bet correctly, and their decision impacted Durham’s growth. “We were the company that chose Durham,” said Brinegar, “and represented the creative class” that the Durham civic leaders envisioned. “Durham is now a creative destination,” said Madison, “with real and authentic character. There’s nothing artificial about this city, and that’s really, really cool to be a part of.”

Durham, which was rated the #1 city for the creative class, “has become an incubator for creative professionals and entrepreneurs,” said Madison.

“In my wildest imagination,” said Brinegar, with a genuine sense of awe, “I don’t think I could have ever seen it as good as it is now.”

The Serial Entrepreneur

Aaron Houghton co-founded iContact with fellow UNC-Chapel Hill student Ryan Allis in fall 2002, launching out of CED’s FastTrac program. iContact was acquired by Vocus in September of 2012 for $169 million, and Houghton has already launched BoostSuite, his fifth company, which recently reached a 5,000 user milestone.

Houghton’s first venture was CollegeUnited, co-founded by Houghton in his dorm room at UNC-Chapel Hill in 1999. The company created an online marketplace that enabled college students to auction and sell high turnover items, including textbooks and furniture. The company ended up closing due to the market crash in 2001, but at its peak, had more than 100,000 registered users, including 88% of the student population at UNC-Chapel Hill.

Perhaps this first venture gave Houghton the skill set needed to build his second business, iContact, into an email marketing giant. The company, which in its early days was housed in office space on Meridian Parkway, which in the early 2000s marked the center of Durham’s entrepreneurial activity.

As Jud Bowman said, that entrepreneurial center changed. Houghton’s current company, Boostsuite is based in downtown Durham “because this is where our team preferred to work,” said Houghton, who added, “I prefer downtown Durham because of the culture.”

“Businesses bet on Durham,” said Houghton, and “these moves set the transformation in motion.” He’s referencing the decision of entrepreneurs and creative professionals to move to and work out of downtown Durham.

“The world’s best entrepreneurs are often people who have chosen alternative paths through life,” said Houghton, which is one reason that “Durham makes their short list.”

The final selling point is often the values that Durham exhibits, said Houghton, who predicted a bright future for Durham and also the Triangle. “Durham may be the most accepting city in the southeast,” said Houghton, “it has proven to be a city that values creativity, free spirit, and prosperity for all.”

The Bootstrapper

“Bronto is born and bred in Durham,” says Joe Colopy. We’re sitting in the break room, surrounded by an abundance of Brontosaurus inflatable toys. Colopy, who is originally from Akron, Ohio, moved to Durham in 1996, and now heads Bronto Software, a global company with headquarters in Durham.

Neither he nor his wife had any ties to Durham, said Colopy, “no jobs, no friends, no connections,” but made the decision the first day they visited the city.

“Durham had a great blend of authenticity in its people, interesting architecture and an independent feel,” said Colopy. “We’ve just grown to love it even more. It’s progressive and intellectual.”

They moved into apartments in the Trinity Park neighborhood. “And we still live in the neighborhood today,” said Colopy. “You know, I’ve always considered Durham as a diamond-in-the-rough, and I felt that other people didn’t yet see it.”

“Some part of Durham was always there, and now it’s gotten better and better,” said Colopy, “now it’s where the action is, where people want to be.”

Colopy found a job – he ended up working at Red Hat, back before the company moved to the Centennial Campus location. In 2000, Colopy “took the plunge,” and started working on his company.

“We started the company out of my house,” said Colopy. He ran the company for 18 months before moving to a space above Parker & Otis, after his co-founder, Chaz Felix joined the company and Colopy and his wife had their first child.
Before its current home at American Tobacco, the eleven-year old company moved into space on Meridian Parkway, and continued to grow between 2002 and 2004. When the company wanted to expand, Colopy looked in Durham.

“We looked in downtown Durham specifically,” said Colopy, “while we were at Brightleaf, we liked the feel, and we wanted to get back to it.”

Bronto first leased 1,500 square feet at American Tobacco, and “we were actually the first tenant to move in,” said Colopy. The building was still under construction. The company is now occupies 30,000 square feet, and has plans in the works to continue their expansion. Bronto Software is now a global company, with an office in London. Of the 165 employees, 150 work out of the headquarters location at American Tobacco.

“I get the idea that we want to operate as a Triangle,” said Colopy, “but the thing that startups want is density.” Entrepreneurs want other entrepreneurs close. “That’s the key,” said Colopy, “particularly with small software companies.”

“We needed an environment that was conducive to this need,” said Colopy. “This has been critical. It’s hard to pull off, but I think Durham has done a good job.”

“As a startup hub,” said Colopy, “Durham’s got a lot of good funkiness going on. It’s appealing.”

I asked Colopy about Durham in 2040. “I would hope that Durham is still, fundamentally, this interesting, funky, compelling place,” said Colopy, who joked about still being alive to see the year 2040. “I think more of Durham will be refurbished and rebuilt. There’s still a lot of room – there’s still a lot of buildings.”

And Bronto’s role? “Bronto will continue to contribute,” said Colopy, “and quite frankly, hopefully we can do for Durham what SAS did for Cary.”

Former Bronto Software employees tend to be entrepreneurial. Several have gone on to start Durham-based Argyle Social, Windsor Circle, and Etailinsights. Each business is “tangential to Bronto’s,” said Colopy, “so I would like to think that we had a positive influence on bringing them into the industry.”

It’s a pattern that a keen observer, or anyone technically proficient on LinkedIn, can see. People who work at startups create more startups. It’s an attitude, an atmosphere, a motivation. And it’s a sign of a healthy startup community, said Colopy.

“Great companies create even more high-growth companies because they show the entrepreneurs what is possible with an idea and a lot of work,” said Colopy, “that has been secret of every successful technology center — from Silicon Valley to Austin, from New York to Boston.”

Over the next two days, we’ll look at emerging startup companies, as well as companies and organizations that have shut down. We’ll look closely at how the companies came to be, their future plans for growth and expansion, and see just how deep Durham’s entrepreneurial bench goes.

Stay tuned.