Gary Davis, the President and CEO of SmartAction, recently made an appearance on the Innovate Fort Worth podcast to discuss his company’s relocation to Fort Worth.
SmartAction uses artificial intelligence – or rather, algorithmic intelligence – to improve companies’ customer service. A “virtual agent” is trained to engage with customers in specific ways that are entirely driven by that customer’s typed or spoken response – think of it like an algorithmic “choose your own adventure” of solutions and answers to customer problems.
Gary had hoped to return to his Texas roots after running SmartAction from El Segundo, California, for several years, he saw his chance. He wanted to find a location for SmartAction that was business-friendly, where he could attract top talent for his company and improve his employees’ cost of living.
“I reached out blindly to the City of Fort Worth, and they responded quickly. They were very interested right away and started digging in with me…Fort Worth was looking, saying ‘How do we bring tech? How do we become the next hub? How do we start doing now what Nashville and Austin did 10-15 years ago?’ And it very much interested me.”
As a tech company, SmartAction fell within the city’s target industries, and since they were looking to add high-paying jobs and skilled employees, it turned out that SmartAction was the perfect match for Fort Worth too.
Like many start-ups, SmartAction was traveling light – their digital product didn’t require a huge amount of space or special equipment, and their employees could work from anywhere with a laptop and a Wi-Fi connection. The company was also financially prepared to lease a temporary site at Hillwood Parkway as part of their move.
As a result, the city had to get creative with its incentives to make sure that SmartAction would make their new home in Fort Worth. This led to SmartAction becoming the first company ever to take advantage of the “high-wage incentive” portion of Fort Worth’s 380 tax abatement for technology companies.
Leveraging a new incentive
When it comes to incentives, the City of Fort Worth’s offerings mostly fall under one of the following categories:
- A tax abatement, which allows the businesses to pay less upfront in taxes every year.
- A Chapter 380 grant, which acts kind of like a tax return – the business pays its local taxes every year, and a portion of those taxes are refunded back to the business in the form of a grant, so long as the business meets specific requirements.
Both kinds of incentives are usually developed around either taxable real property (like land, or a brick-and-mortar business), or business personal property (like equipment, computers, office furnishings, or other moveable items owned by a business.) As a digital company, SmartAction didn’t have – or need – much of either.
But what SmartAction did have was high-wage employees – 66 employees, at the time of their relocation. And these employees were multi-disciplinary, having been trained in highly technical, highly sought-after skills, including coding, software engineering, research and development, and data mining.
Those 66 employees became the foundation for the city’s Chapter 380 grant, which provided SmartAction with $10,000 per full-time employee whose salary met at least $65,800 – demonstrating the value of their skillsets – for their first three years of operation in Fort Worth.
There were other conditions to the agreement – the employment incentive was capped at $660,000, and SmartAction had to maintain at least 46-65 full-time employees. The company also had to occupy a permanent office space in Fort Worth by January 2022.
But this Chapter 380 incentive truly benefited both parties. For SmartAction, the incentive provided some needed upfront capital to assist with their move from California to Texas, and rewarded them for bringing a highly-skilled workforce to the area.
For Fort Worth, the incentive successfully introduced an up-and-coming player in one of our city’s target industries to the area, who could also serve as a potential partner capable of helping other Fort Worth businesses access AI resources to improve their own productivity and efficiency.
The hope is that these incentives will attract even more tech companies and more skilled tech employees, and grow Fort Worth’s reputation as a hub for creative businesses like SmartAction – further fueling the friendly, hand-shake community that inspired Gary to bring SmartAction here in the first place.
About the Author
Andrea Duffie handles communications, marketing and PR for the City of Fort Worth’s Economic Development Department. She moved into Economic Development following seven years in the city’s main Communications Department, where she provided marketing support across multiple channels for Economic Development, the Park & Recreation Department, the city website, and other initiatives. Prior to her time at the City of Fort Worth, Andrea worked for several nonprofits, including the Modern Art Museum of Fort Worth.