DURHAM – American Underground begins 2021 as strong as ever, according to figures released in its latest annual report.

Despite a year of upheaval triggered by a global pandemic and racial protests, the Durham-based startup and entrepreneurial hub raked in their largest fundraising year-end haul to date – with companies headquartered there raising $108.7 million last year alone.

That’s up from $29.5 million from 2019 – a 37.25 percent hike.

“We were impressed, too,” said Adam Klein, who moved into the role as AU’s chief strategist in March.

American Underground

“It was kind of a shock given how pervasive the impact of COVID is.”

The report, collated in partnership with UNC-Chapel Hill’s Kenan Institute, is the first real snapshot measuring the pandemic’s impact on AU’s community, he added, and offered up some other noteworthy highlights in an unprecedented year.

Data also shows 47 percent of companies that raised money, were led by a female founder or a person of color. That figure included a seven percent jump for female founders and a 15 percent hike for people of color – something that is “long overdue,” Klein said.

Interest rates dropping also proved fertile ground for investors “willing to seek out new investments.”

Still, he is clear-eyed about the future: “There is much more work to take place.”

In a nod to the times, the report also included news stats: 189,390 Zoom calls, 62 hours of virtual workshops and 146 member events (online or socially distanced) since COVID-19.

 ‘Virtual memberships’ grow

AU is one of 11 Google for Startups hubs in North America, and is owned by WRAL TechWire parent Capitol Broadcasting.

American Underground turns 10: The evolution to Triangle treasure from trash in a basement

It launched 10 years ago in the basement of an old tobacco warehouse at the American Tobacco Historic District. Today, it encompasses close to 125,000 square feet of space at three locations in downtown Durham.

After taking a hit in July with “lease terminations” and companies “pulling back into smaller space,” Klein said AU’s membership is now at 275 and holding strong.

“We’ve added back all of the members we’ve lost and are now ahead of where we were before COVID.”

That growth is largely being fueled by its “virtual memberships.”

It includes access to AU’s Slack channel, community events and conference rooms, along with a program that offers members up to $100,000 in Google credits – a “major driver of interest.”

What a year: NC startup deals top $3.6B, 6th nationally, but Epic deal skews data

In addition, the hub launched the Landing Spot Program, in partnership with Digital Ocean, to support laid-off employees ready to start their own business.

Klein anticipates a number of these members will transition to workspace “as the vaccine gets rolled out and people feel more comfortable being in an office environment.”

 ‘Quite a ride’

With 2020 now in the rear view, Klein admited: “It’s been quite a ride.”

But he maintains the community is thriving.

“The pandemic has driven growth for a number of our companies,” he said, “so I’m seeing them hire pretty aggressively right now, getting ready for a pretty big next year.”

He’s also seeing members who have made some “strategic pivots” during the pandemic, and they’re now paying off.

Another sign of promise is “a major influx of serial entrepreneurs” from other big metros, he said.

People who have done this multiple times are choosing the region to build their “third, fourth, fifth company.”

“That sort of senior level of talent is not necessarily what I’ve seen before.”

While “co-working” as a practice with a “big open space and hot desk” isn’t expected to come back until this fall, he remains confident about the hub’s prospects.

Said Klein: “Between the increase in funds, strong third and fourth quarters, and the surge in new founders starting companies, the table is set for a great 2021.”