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Posted on Tue, Oct 2, 2012 : 5:57 a.m.

Tech startup Duo Security moving out of Tech Brewery and into Bay Design building

By Ben Freed


New building owner Michael Yi, left, and his broker, Dan Stewart, outside the Bay Design building on Detroit Street in Ann Arbor.

Angela Cesere |

When Michael Yi bought the building that houses Bay Design, he said he wanted to “reposition” the building for office space and find tenants that might include high-tech or software companies. That was music to Duo Security CEO Dug Song’s ears.

“We had been out of space for a while,” Song said. “We more than quadrupled headcount in the last 8 months and we just didn’t fit in the Tech Brewery anymore. We looked at a lot of other places downtown, but everything was ‘landlocked.’

"There aren’t places that allow you to grow from being a small company to a medium-sized company.”


Dug Song at the Tech Brewery on Jones Drive in Ann Arbor.

Mark Bialek | For

Duo Security recently signed a master lease for the first floor of the building, giving them 5,021 square feet of space.

The web security company specializes in two-factor authentication that uses mobile phones to create more secure login procedures. Push notifications, text messages, and automated calls can all be used by Duo’s system to ensure that the person logging into an account is not a hacker. The company has attracted $6 million in venture capital in 2012.

Duo Security has been hiring and will continue to do so, Song said. However, most of their hires come “quietly,” through personal networks and referrals.

The pace of hiring was attractive to Yi as he considered the deal. Now, he said, the company will move into the building on January 1, after renovations are complete.

“This deal is turning out even better than I expected,” he said. “Duo has very good potential and will be there for a while. They’re looking into the future and being able to expand into additional space.”

Tech Brewery company Saagara is leasing 1,500 square feet on the lower level of the building. Saagra is a digital health company developing an apps that aim to change people’s lifestyles. Song has been very involved in the “operation” of the Tech Brewery. He said he intends to continue working with companies in the incubator, and that more companies from the brewery might move to the Bay Design building as time goes on.

Tech Brewery building owner Doug Smith of Swisher Commercial Real Estate said that while he is sad to see Duo Security and Saagara leave, there are other companies in the brewery that are also growing out of their current space.

"We have someone downstairs who had three people sharing one office, and they're going to take Saagara's space," he said.

"Our unofficial rule is that we look to current tenants in the brewery to fill office vacancies, and then we have a waiting list for spots in the brewery itself. It's kind of a constant migration in, around, and out of the building."

One of Duo’s major investors, Resonant Venture Partners, will also initially be joining them in the first-floor space.

“They’re in the same building as EDV Ventures right now,” Song said. “As friends and investors I want to help get them into a space that’s more fitting for them.”

Resonant co-founder Jason Townsend said he and his company were also excited to be moving in with one of their portfolio clients.

"When Dug invited us to share the office space it was a no-brainer," he said. "EDF had provided us with great mentorship, but now that we have our own portfolio it was time to move to a new space."

Song said that his company was hesitant to leave the Tech Brewery because of the culture and community at the incubator. However, once he was forced to sit on random pieces of office furniture, or even the floor, he knew that they needed to find a new space.

“I’d like to be in downtown proper, but there are logistical challenges to doing so,” he said.

“We decided to go with this building in part because we really like the building itself. It’s modern, it’s quirky, and it’s a block from Zingerman’s. Though that could potentially be dangerous for us.”

Current tenants Synthetic Biologics will remain in their 1,500 square foot space in the lower level of the building, and Yi said he has two more slightly smaller offices that are still on the market.

Yi said the building is also attractive for companies because of its proximity to the train station and the 30 parking spaces that come with the property. Realtor Dan Stewart of Sperry Van Ness/Stewart Commercial Group represented Yi in the deal. Song did not have a Realtor but Yi said Jason Townsend of Resonant Venture Partners was very involved in the negotiations.

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Ben Freed covers business for Reach him at 734-623-2528 or email him at Follow him on twitter @BFreedinA2


Larry Baird

Tue, Oct 2, 2012 : 4:25 p.m.

" Yi said the building is also attractive for companies because of its proximity to the train station.." Yes, the location of the existing train station helps add value to all the adjacent businesses and residences. Unfortunately, the city's goal of moving the train station away from this neighborhood, moves a vital long term asset away from a "walkable community" to the middle of a system of city parks, much farther away from downtown, Kerrytown and the many transit oriented development (TOD) opportunities that exist on North Main.


Tue, Oct 2, 2012 : 2:50 p.m.

Congrats to Dug Song and Duo Security on your expansion! Nice to see local business people thriving in this town!


Tue, Oct 2, 2012 : 2:32 p.m.

So let me get this straight. A company in Ann Arbor moves from an incubator facility to a recently available building. In that process they don't ask for, or receive, any money from SPARK, any tax abatements, any free parking, ... What is wrong with this picture?

Kai Petainen

Tue, Oct 2, 2012 : 2:24 p.m.

Let me clarify what I said... The topic of security and identity theft is important, and I found out about it the hard way. Recently, I was a victim of identity theft, as someone used a Paypal app at a Home Depot. I was thinking that I'd write positively about Duo Security... as businesses/services such as this become much more important... as the issue of security becomes more important. The article that I wrote, actually speaks nicely of PayPal and Home Depot, as it is called: "how to protect yourself from paypal identity theft"

Linda Peck

Tue, Oct 2, 2012 : 2:05 p.m.

What a great location for a tech company! It is near the lovely park along the river and Kerrytown, and also the Broadway shops are within walking distance.

Kai Petainen

Tue, Oct 2, 2012 : 12:54 p.m.

i need to write about duo security...recently i was a victim of identity theft. someone walked into a home depot on the other side of the country and used a paypal app to buy almost $8,000 worth of $200 gift certificates. i wrote about it here:

Kai Petainen

Tue, Oct 2, 2012 : 2:31 p.m.

The annual report was just released for PLL. They lowered the remediation reserve from $10.7 million to $8.1 million.

Kai Petainen

Tue, Oct 2, 2012 : 2:17 p.m.

brian... thanks.... i'll clarify what i said.


Tue, Oct 2, 2012 : 1:56 p.m.

Kai Petainen - - Without reading your article to learn more...are you saying Duo Security had anything to do with your identify theft (e.g., lack of adequate security)? Because if not, and you're just plugging their business, you might want to reconsider how you phrase your first could be misconstrued as sounding like they were the reason you were a victim. Just a heads up.

Larry Works

Tue, Oct 2, 2012 : 1:45 p.m.

Love the way you linked good customer service at PayPal with bad customer service from Pall. As a Scio resident aware of the Pall plume and wanting more information from the source, your experience with them is identical to ours.