Mad (About) Entrepreneurship in the Triangle

March
6,
2014
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File 5174Here on Tobacco Road, with March comes Madness. Even if you don’t follow men’s college basketball, the ACC and NCAA tournaments are unavoidable in North Carolina during March. In these tourneys, rivalries are at their peak. And unless you live under a rock, you know that the biggest college basketball rivalry pits UNC and Duke.

Locals have strong hardwood allegiances, but UNC and Duke fans call a temporary truce when it comes to supporting the Triangle’s young socialFile 5155 entrepreneurs. CUBE has facilitated three key collaborations between ventures, university legal clinics, and pro-bono support that span this historically heated and sometimes bloody rivalry.

Starting this spring, CUBE ventures have become clients of the Duke Law School Start-up Ventures Clinic, which provides legal advice and assistance to seed and early-stage startups and social ventures that have not yet raised significant amounts of outside capital. These partnerships have been a huge success—we’re assuming that basketball did not come up in their conversations. Director Jeff Ward and the student-attorneys in the Clinic relish their relationship with the CUBE. “It's difficult for me to imagine a better opportunity for collaboration than that offered by the CUBE,” Ward says. “It’s a wonderful educational and professional development opportunity for my students, and we look forward to finding ways to continue an effective UNC-Duke partnership.”

File 5197Half of the new CUBE teams—Freedom Code, Buzz Rides, Emerge, Made With Love Bakery, and Seal the Seasons—are receiving pro bono legal advice from the Duke Clinic. And the results are a slam dunk. Erin Bergstrom of Emerge says, “CUBE made it possible for us to jump right into getting the legal support we needed early on.”

Many CUBE teams grapple with decisions about their choice of entity: should the team form a non-profit, tax-exempt entity, aka a 501c3 Should it be a for-profit company, perhaps an LLC? Or is a hybrid structure or a b-corporation status a better fit? Bergstrom and Emerge’s work with the Clinic will focus on choosing the best legal structure to support their efforts in developing microenterprises and providing self-employment support services to North Carolinians with severe mental illness.

Allison Norman, founder of Made With Love Bakery, describes the Duke Clinic as “an invaluable partner providing essential support” to her as she incorporated as an LLC, resolved liability issues, addressed insurance coverage and permits, and figured out how to abide by health code regulations. These critical steps unlock the potential of her venture to stay “on mission,” selling Southern baked goods as a way to provide transitional employment to homeless individuals in Orange County.

Not every CUBE team has to travel to Durham for help. UNC Law’s Community Development Law Clinic (CDLC), supervised by Professor Tom Kelley, has been advising CUBE ventures for more than two years, specifically on the complicated matter of non-profit status. According to Kelley, these cases provide “interesting legal challenges” for the third-year law students. Heck, these cases are harder to solve than Roy Williams’s patented secondary fast break. Nevertheless, it’s a beneficial learning experience for all involved.

CDLC is scoring points for past and current CUBE ventures, helping them transition from student organization into an independent, scalable social enterprise. According to Katie Weinel, founder of Musical Empowerment, which graduated from the CUBE in January of this year, “CDLC helped us become a concrete entity with a firm, sustainable foundation.” Camille McGirt, founder of Healthy Girls Save the World, which combats child obesity and related chronic diseases by providing preventive health education to girls in North Carolina, concurs. “CDLC students have the knowledge, skills and expertise to move us out of the student organization phase,” putting them firmly on the road to becoming a freestanding, legally-recognized non-profit organization.

New teams such as SUCCEED, Inc., and Boys on Track will apply not only for 501(c)3 non-profit status, but to consider liability concerns. For SUCCEED, Inc., legal liability is a big concern—the team plans to provide a cost-effective, hands-on STEM education program in NC public schools by leveraging unused science materials, equipment, and instruments held by local biotech companies and universities. Likewise, Boys on Track will create a running program for middle school boys in Durham that combats interpersonal violence and promotes positive masculinity. According to Zach Dvorak, a member of the SUCCEED, Inc. leadership team, these issues are “vital to our success as an organization.”

Resolving legal challenges is a critical part of the entrepreneurial process. CUBE’s collaboration with Duke is a perfect example of how we can put rivalries aside to build critical new infrastructure in the Triangle in order to translate innovative ideas into lasting impact.


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