< Previous114 T E X A S E C O N O MI C DE V E L O P M E N T G U I DE15th-best State Business Tax Climate Index in the nation for 2019, led by the state’s sterling No. 6 ranking for individual taxes.Chief Executive Magazine has rated Texas the No. 1 place to do business in America a record 15 years in a row, while CNBC has named Texas the No. 1 Top State for Business for 2018.Jason Taylor, founder and CEO of Code Authority Inc. in Frisco, says there’s another reason why entrepreneurs like him succeed in Texas: access to talent. “We were fresh off the dot-com bubble and burst when I started this company in 2001,” he says. “I had no partners and no financial backing.”Setting up shop in Frisco provided the answer. “We came here in 2008 when I was seeking a better work-home-life balance,” he notes. “We were at 20 employees when I moved into our new space in 2015, and we are at 40 right now. Our typical employee has a background in computer science from University of North Texas or University of Texas at Dallas. We don’t have any challenges recruiting people to our location.”A software development consultant who was named the 2015 Frisco Chamber Entrepreneur of the Year, Taylor says he finds Frisco “a very attractive place. All the amenities of work-life balance are here. The best business decision I ever made was to move my business to Frisco.”Texas also goes out of its way to give business startups the two resources they need most: intellectual capital and financial capital. According to the National Science Foundation, universities in Texas rank among the national leaders when it comes to total R&D expenditures, which often lead to commercialization of research coming out of these schools.Texas A&M University in College Station ranks No. 19 in the country with total R&D expenditures of $905.5 million in 2017. The University of Texas M.D. Anderson Cancer Center in Houston checks in at No. 21 with $888 million in R&D expenditures T E X A S E C O N O MI C DE V E L O P M E N T G U I DE 115that year. The University of Texas at Austin, meanwhile, recorded $652 million in R&D expenses, good for 35th. Also making the top 75 schools in America was the University of Texas Southwestern Medical Center with $462 million, good for 52nd.High-Growth Firms Kick Up Their HeelsTexas has few peers when it comes to venture capital funding as well. According to a report by PwC and CB Insights, just four states control 80 percent of all venture capital dollars in America, and Texas is one of them. California is the national leader, but Texas ranks fourth in the country with $747 million going to 55 deals during the first quarter of 2018. The average VC deal in Texas during that three-month period was for $13.58 million.Resources like that are a big reason why Texas was able to produce 421 of the Inc. 5,000 fastest-growing companies in America in 2018. The highest-ranked Texas firm on that coveted list, No. 67 Monkedia, grew by a whopping 4,395 percent. The Irving-based firm is a rising star in the advertising and marketing business. Other home-grown success stories include No. 104 Asset Panda in Frisco (3,552 percent growth); No. 140 Student Loan Hero in Austin (2,916 percent); No. 145 Karya Property Management in Houston (2,860 percent); and No. 201 Acuity Surgical Services in Dallas (2,233 percent).Perhaps that’s why Texas Monthly author David Courtney recently opined that “ours is a land of resourceful, imaginative, inventive and self-reliant people. It has always been this way.”The next time you bite into a hamburger, use a rotisserie smoker or dance to original country music, just imagine being in Texas — because that’s where all three of those things began. Texas ranks No. 5 in the country in Early Stage Entrepreneurship.Source: Kauffman Foundation#5116 T E X A S E C O N O MI C DE V E L O P M E N T G U I DEM I N O R I T Y - & W O M E N - O W N E D B U S I N E S S E Sou’ve heard of Neiman Marcus? Mary Kay Cosmetics? Liquid Paper? These three wildly successful endeavors share one thing in common: Each was launched by a woman in Texas. Along with her husband, Al, Carrie Marcus Nieman founded the original Neiman Marcus department store in 1907 in Dallas. With Al handing the store’s finances, Carrie selected the merchandise, which originally included farm goods. Still headquartered in Dallas, Gov. Greg Abbott shakes hands with Houston entrepreneur Tamala Austin, owner of J.I.V.E. Juice.Photo courtesy Office of the Governorby GARY DAUGHTERSYTexas is #1 for Women-Owned Businesses118 T E X A S E C O N O MI C DE V E L O P M E N T G U I DEthe Neiman Marcus Group operates 42 stores nationwide and remains synonymous with high-end apparel and other luxury items. Passed over for a promotion in favor of a man, Mary Kay Ash went to work on a book for businesswomen in 1963. The book turned into a business plan, from which Beauty by Mary Kay was launched in Dallas. Now the world’s sixth-largest marketing company, Mary Kay Cosmetics posted 2017 revenues of $3.6 billion. Bette Nesmith Graham (coincidentally, the mother of Michael Nesmith of The Monkees) made her mark on the business world through a bold example of improvisation. An executive secretary at Texas Bank and Trust during the 1950’s, Graham hit upon the notion of using a water-based paint mixture to cover up typing mistakes. “Mistake Out,” founded in Dallas in 1956, later became Liquid Paper, which was sold to Gillette in 1979 for $48 million. The example set by Nieman, Ash and Graham continues today, with Texas having recently been hailed as 2019’s best state for women entrepreneurs by fitsmallbusiness.com. “Texas,” states the website, “is hands-down one of the nation’s top states due to its business-friendly legal and economic climate. Put aside having no corporate or income taxes and a high rate of startup growth; startups are flocking to Texas.”In a separate ranking by smallbiztrends.com, Houston, San Antonio and Dallas all rank among the top 10 cities in the country for minority entrepreneurs. Houston is third on the website’s list, with 155,654. San Antonio (71,287) and Dallas (65,749) rank sixth and seventh respectively. Likewise, the study cites Texas’s lack of corporate and personal income taxes, plus an overall positive business climate and incentives attractive to startups. In all, 1.1 million minority-owned businesses call Texas home, according to the U.S. Small Business Administration.The state’s Historically Underutilized Business (HUB) Program was established in 1991 to increase opportunities available to businesses owned T E X A S E C O N O MI C DE V E L O P M E N T G U I DE 119by women and minorities in the area of state procurement and contracting. Certified businesses are listed in an online directory to increase their exposure to solicitations for the procurement of goods and services to state agencies. To qualify, a business must be at least 51 percent owned by an Asian Pacific American, Black American, Hispanic American, Native American, American woman or service-rendered disabled veteran. Today’s top Texas minority entrepreneurs include:• Arita Nicholas, founder and owner of Houston-based Nicholas Earth Printing, one of the largest woman-and minority-owned commercial printers.• Julissa Carielo, owner of Tejas Premier Building Contractor, which employs a team of 50 in San Antonio.• Tamala Austin, author of “Love My Body Again” and owner of Houston’s J.I.V.E. Juice, which offers cold-pressed juices and smoothies for delivery and retail. J.I.V.E. Juice was placed in Houston Whole Foods stores in November of 2018. Saluting Austin’s success in his 2019 State of the State address, Texas Governor Greg Abbott noted that, “Inspiration, hard work and drive pay off in Texas. They paid off for Tamala.” “Inspiration, hard work and drive pay off in Texas.”— Gov. Greg Abbott T E X A S E C O N O MI C DE V E L O P M E N T G U I DErom Fortune 500 to Forbes Global 2000 — it’s hard to look at either of these annual rankings of national and world-class companies without noting the huge Texas presence. A great number and wide variety of businesses have decided to locate their main operations in the Lone Star State, and that’s no surprise to leaders here who know the power of a strong workforce, great location, low taxes and solid infrastructure.Justin Yancy, president of the Texas Business Leadership Council, for one, feels the state is committed to increasing educational success at all levels, thereby building a more globally-competitive workforce.”FWho’sIn? Who’sIn? Many companies call the Lone Star State home.by FRANK REDDYDowntown Dallas viewed from Reunion Tower. Photo by Heather OvermanC O RP O R A T E H Q S122 T E X A S E C O N O MI C DE V E L O P M E N T G U I DEAdded Yancy: “That priority, along with our stable regulatory climate and civil justice system, a strong entrepreneurial spirit, and a full toolkit of economic incentives keeps Texas moving resolutely in the right direction. A common-sense business climate and a welcoming culture go a long way with fueling our robust economic engine.”That robust economic engine is home to Fortune 10 companies like ExxonMobil in Irving and AT&T in Dallas. And now, the nation’s largest pharmaceuticals distributor, McKesson — ranked sixth by Fortune — has chosen to relocate to Irving.Irving has been called the “headquarters of headquarters” by some, but all areas of the state are well represented when it comes to being the base of operations for some of the world’s largest companies.The Lone Star State is currently home to 48 Fortune 500 corporate headquarters, with high concentrations in Dallas, Irving, Fort Worth and Houston, as well as major company headquarters in San Antonio, Austin and beyond. The state’s presence on the Forbes Global 2000 — ranking the world’s largest companies — is also impressive, with 52 companies in Texas.The past year has been a noteworthy one, with continued expansions, investments and relocations all over the map and from every imaginable industry — medical device manufacturers, construction companies, grocers, tech businesses and beyond.“A common-sense business climate and a welcoming culture go a long way with fueling our robust economic engine.”— Justin Yancy, president of the Texas Business Leadership CouncilFrisco StationImage courtesy of the City of FriscoT E X A S E C O N O MI C DE V E L O P M E N T G U I DE 123In Dallas-Fort Worth and Irving, leaders with Smoothie King announced the company was relocating headquarters to Irving’s Cypress Waters development over the summer — bolstering an already-heavy presence of locations in the area.London-based software firm Basis Technologies also relocated, moving from Vancouver, Canada to Addison; CORE Construction parent company, CORE West Inc., announced plans to relocate headquarters from Phoenix to Frisco, Texas; and, Orthopedic device maker DJO is moving from California to Lewisville, Texas.Meanwhile, niche global BI & Analytics solutions firm, Visual BI Solutions, announced an expansion in Plano — creating 100 new jobs by 2022.Beyond Dallas-Fort Worth and Irving, San Antonio grocer H-E-B opened new digital headquarters in Austin; business processes and services company OKIN BPS announced new headquarters in San Antonio, as did Victory Capital — relocating its Global Investment Management Business headquarters there.In Houston, Classification Society ABS held a ribbon cutting January 2019 to commemorate its new global headquarters there; and, immuno-oncology company, Marker Therapeutics, relocated from Jacksonville, Fla.The ongoing buzz about headquarters expansions and relocations is no surprise to Yancy, who said that “it all comes down to Texas’ continued culture as a place that welcomes business and welcomes entrepreneurs … our state works at it to keep making it an attractive place for businesses to come and grow.” Next >