NORTH CAROLINAINFORMATION TECHNOLOGYINDUSTRY

O U R H O M E I S YO U R H O M E F O R B U S I N E S S

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ECONOMIC DEVELOPMENT PARTNERSHIP OF NORTH CAROLINA 2018

Revised November 2016

03ABOUT NORTH CAROLINA

04NC TECHNOLOGY ADVANTAGE

06GROWTH & INNOVATION

08WORKFORCE & INDUSTRY SUPPORT

10BUSINESS ENVIRONMENT

North Carolina’s winning combination of location, workforce, existing industry strength, and business-friendly environment makes it a leading destination for information technology (IT) companies. The state boasts a fast-growing economy and consistently ranks among the top five in internationally recognized business environment rankings.

North Carolina has the ninth-largest population in the U.S. with over 10 million residents. The state’s highly educated workforce, concentration of research & development activity, and low cost of living contribute to its favorable business environment. North Carolina is a leader in industries such as software, computer & electronics, and data analytics. Both industry giants and smaller, niche businesses have enjoyed significant growth in the state. Whatever an IT company needs, North Carolina has the resources to support it, including:

Consider North Carolina for your next investment decision, and find out why Nothing Compares.

• Skilled labor force

• Business-friendly environment

• Top-ranked industry support

• Exceptional quality of life

INVEST INNORTH CAROLINA

NORTH CAROLINA HAS

BEEN A STRATEGIC

PARTNER TO RED HAT

FOR MORE THAN A

DECADE. THE TALENT

BASE WE’VE BEEN

ABLE TO ATTRACT

HEADQUARTERED IN

THIS STATE HAS BEEN

PHENOMENAL.

-JIM WHITEHURST,PRESIDENT AND CEO, REDHAT

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Often dubbed “The Next Silicon Valley,” North Carolina is a U.S. leader in technology and innovation. North Carolina companies take advantage of the region’s large IT cluster to grow and innovate. For example, IBM and Red Hat enjoy a strategic alliance to develop new information technology solutions. North Carolina is also a leading state for STEM job growth. More than 132,000 North Carolina residents make up the state’s robust and growing IT workforce. With such a booming industry, North Carolina companies can easily hire the specialized talent they need.

TECHNOLOGYADVANTAGE

NORTH CAROLINA’S

NORTH CAROLINA IS HOME TO TECHNOLOGY INDUSTRY

LEADERS ENGAGED IN PRODUCT AND PROCESS

INNOVATION. FROM HARDWARE AND SOFTWARE

DEVELOPMENT TO CLOUD COMPUTING AND DATA

ANALYTICS, NORTH CAROLINA COMPANIES FLOURISH IN

THE STATE’S UNIQUE ECOSYSTEM OF COLLABORATIVE

RESEARCH AND PRODUCT DEVELOPMENT.

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LARGEST RESEARCH PARK IN THE U.S.(SEVEN RESEARCH PARKS STATEWIDE)

Established in 1959, Research Triangle Park (RTP) is the oldest of seven major research parks across North Carolina. It is the largest research park in the U.S., and is located between three Tier 1 research universities. RTP is home to more than 200 of the world’s most innovative and cutting-edge companies, employing 50,000+ people. Other parks that serve the information technology industry include the Wake Forest Innovation Quarter in Winston-Salem, Gateway University Research Park in Greensboro, and the Charlotte Research Institute in Charlotte.

SOFTWARE & COMPUTER SYSTEMS DESIGN

FINANCIAL TECHNOLOGY (FINTECH)

INTERNET & TELECOMMUNICATIONS

HARDWARE

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From angel and venture capital funding to tech-focused business incubators and accelerators, North Carolina nurtures a dynamic entrepreneurial environment. Thirty-six information technology companies received more than $531 million in equity funding, grants, and awards in 2015, a 91% increase from 2014. In addition, North Carolina

colleges and universities across the state partner with entrepreneurs and businesses of all sizes to develop and promote new technology. North Carolina’s broad range of innovation support activities makes it an ideal destination for information technology companies.

NORTH CAROLINA SUPPORTSGROWTH & INNOVATION

TECHNOLOGY INCUBATORS AND ACCELERATORS

American Underground (and Google for Entrepreneurs Tech Hub)- Raleigh and Durham, NC With four campuses in the Raleigh-Durham area, American Underground offers office and working space, accelerator and incubator programs, a tech training academy, and the Iron Yard coding academy. In addition, American Underground is home to one of seven U.S. Google Tech Hubs.

Queen City FinTech at Packard Place- Charlotte, NC Queen City Fintech is a 12-week accelerator program designed to mature financial technology startups through intense mentorship from leading banking executives, business development professionals, venture capitalists, and attorneys in Charlotte’s robust business community.

Technology Incubator at Centennial Campus- Raleigh, NC Housed at North Carolina State University’s Centennial Campus, the Technology Incubator offers programs and facilities specifically designed for tech start-ups with high-impact potential. The Technology Incubator’s location provides unparalleled access to researchers and students, giving clients a R&D competitive advantage.

Ventureprise at the University of North Carolina-Charlotte- Charlotte, NC The Ventureprise incubator and accelerator program at UNC-Charlotte provides office space, business model development, coaching, mentoring, and support resources to early stage high growth innovation companies.

Other information technology and innovation resources include CED, NC IDEA, North Carolina Center of Innovation Network (NC COIN), InnovateNC, Innovation Fund North Carolina, North Carolina Technology Association (NCTA), Wireless Research Center, and many more…

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Reflecting the state’s growing technology cluster, the U.S. Chamber of Commerce recognizes North Carolina as having one of the best environments for STEM job growth in the U.S.

#6 Best State for STEM Job

Growth

Licenses & Options Executed in 2014

Invention Disclosures in 2014

Patents Issued in 2014

New Patent Applications in 2014

342

619

141

382

TECHNOLOGY TRANSFER

North Carolina universities have active technology transfer offices dedicated to helping companies bring real world solutions to the marketplace.

CNBC ranked North Carolina as the seventh most innovative state in 2016. In addition to North Carolina’s technology industry growth, CNBC also considered patent activity and research grants.

Top State for Technology Innovation

Two of North Carolina’s universities, the University of North Carolina-Chapel Hill and Duke University, rank among the top 50 universities in the world for the most U.S. utility patents issued in 2014.

Most U.S. Utility

Patents

With 68% growth from 2012 to 2016, North Carolina has the fastest growing large software industry in the U.S. (10,000+ employees).

Fastest Growing Large Software

Industry

Citrix employees share ideas during a meeting at the company’s state-of-the-art office in downtown Raleigh, NC. Photo courtesy of Citrix

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INDUSTRY SUPPORT

& SKILLED WORKFORCE

OUR GROWTH TRAJECTORY FURTHER EMPHASIZES OUR EVER-EXPANDING NEED FOR TOP TECHNOLOGY, DESIGN, AND ANALYTICS

TALENT…THE STATE OF NORTH CAROLINA REMAINS THE INDISPUTABLE LOCATION TO EXPAND OUR FOOTPRINT AND ADVANCE OUR LEADERSHIP

POSITION WITHIN THE FINTECH INDUSTRY.

-DOUG LEBDA, FOUNDER AND CEO, LENDINGTREE

More than 117,600 people hold computer science, software development, and database and information specialist jobs in North Carolina.

117,300+ Computer Occupations

20,500+ North Carolina residents graduated from STEM programs in 2014, the second most of any Southeastern state.

#2 STEM Graduates

North Carolina’s colleges and universities regularly partner with businesses on IT-related R&D and workforce training.

University-Industry Partnerships

In 2016, CBRE ranked Raleigh-Durham and Charlotte among the top tech talent markets in the U.S. In fact, Charlotte is the second-fastest growing tech market (>50,000 labor pool), with 75% growth in the last five years.

Top Market for Tech Talent

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UNIVERSITIES

Elite higher education institutions across the state support North Carolina’s workforce. North Carolina has 53 colleges and universities. Nearly every college and university offers degrees in computer and information sciences. The state’s three Tier 1 research universities: North Carolina State University, Duke University, and the University of North Carolina at Chapel Hill, are at the cutting edge of education and R&D. North Carolina State University houses the nation’s first Master of Science in Analytics program. Businesses regularly collaborate with NC colleges & universities. Verizon and Duke University collaborate on health information technology initiatives. IBM partners with UNC-Charlotte to roll out new curricula for data scientists. Medidata has teamed up with UNC-Wilmington to train researchers.

NCWORKS

Providing customized training and recruiting services for North Carolina businesses.

The North Carolina Department of Commerce and the North Carolina Community College System (NCCCS) developed NCWorks, a free, customized job training and recruiting program for new and expanding businesses. NCWorks offers comprehensive training via NCCCS’s extensive catalogue of programs as well as customized curricula tailored to address the specific needs of local business and industry. NCWorks has trained nearly 37,000 employees from 861 companies across the state.

COMMUNITY COLLEGES

Pioneering the nation’s most advanced programs in technical and vocational education.

The North Carolina Community College System (NCCCS) is widely regarded as offering some of the most comprehensive and advanced technical and vocational programs in the U.S. For example, Wake Technical Community College partnered with IBM and SAS to launch the first and only Associate’s Degree in Business Analytics. More than 800,000 students enroll at one of NCCCS’s 58 campuses each year. Every North Carolina resident lives within a 30-minute drive of a community college, making high quality education accessible to the state’s growing workforce.

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UNMATCHEDBUSINESS ENVIRONMENT

Top Competitive State- Site Selection (2015 Prosperity Cup)

#1Best State for Business

- Forbes (2016)

#2Lowest State & Local Business Tax Burden

in the U.S.- Ernst & Young (2015)

#3Best State for Business- Chief Executive Magazine (2016)

#3

Average construction costs in North Carolina’s

metropolitan areas are 18% below the national average.

Low Construction Costs

Source: RSMeans

North Carolina’s electricity costs run nearly 9% below the

national average.

Low Electricity Costs

Source: U.S. Energy Information Administration

North Carolina’s 53 colleges & universities and nationally recognized, 58-campus community college system produce a highly skilled workforce.

Highly Skilled Workforce

• 108,800 degrees awarded from North Carolina colleges and universities in 2014

• 117,300 computer occupations including computer science, software development and database & information specialist jobs.

• Customized training and industry partnership opportunities.

The average cost of living in North Carolina’s major metropolitan areas is up to 47% less than in other IT industry hubs.

Low Cost of Living

Index (100 = National Average)

Source: Council for Community and Economic Research

NC Metro Average 94

Dallas 98

Seattle 126

Boston 144

Washington 147

NYC/New Jersey 163

San Francisco 176

0 20 40 60 80 100 120 140 160 180

NORTH CAROLINA IS ONE OF THE MOST PROMISING BUSINESS REGIONS IN THE U.S., AND IT’S GRATIFYING TO PLAY A ROLE IN ITS CONTINUED GROWTH. WE LOOK FORWARD TO CONTINUED

COLLABORATION AND INVESTMENT IN THE REGION FOR YEARS TO COME.

- JOHN GAUNT, VICE PRESIDENT, HCL TECHNOLOGIES

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TAXES

INCENTIVES

Corporate Income Tax

3.0%North Carolina has the

lowest corporate income tax rate in the U.S. (of

states that levy the tax). North Carolina will fully

phase in single sales factor apportionment in 2018.

Sales & Use Tax

The statewide sales tax is 4.75%. Counties levy an additional

2-2.75%. North Carolina also has exemptions for data centers and

manufacturing operations.

6.75% -7.50% Real and personal

property is taxed by local governments.

North Carolina has exemptions for inventories and

recycling.

Property Tax

The state does not levy property tax.

Targeted, performance-based incentive programs complement North Carolina’s competitive business cost structure. The Economic Development Partnership of North Carolina helps companies navigate the incentive process.

North Carolina offers a number of different programs to fund public infrastructure development, including: • Community Development Block Grant Economic Development Program• Utility Account• Rural Division’s Economic Infrastructure Program• NC Department of Commerce & NC Department of Transportation’s Joint Economic Development Program

Public Infrastructure & Transportation Programs

North Carolina offers two different programs that provide grants to renovate and upfit vacant industrial and commercial buildings including: • Community Development Block Grant Building Reuse Program• Rural Division’s Building Reuse Program

Building Reuse Programs• NCWorks Customized Training Program• Foreign Trade Zones• Golden LEAF Foundation Grants

Other Incentive Programs

JDIG is a performance-based, discretionary incentive program that provides cash grants to new and expanding businesses to help offset the cost of locating or expanding a business facility in North Carolina. Companies can qualify for a JDIG based on the project location, number of jobs, and average wage. The grant amount is based on a percentage of the personal income tax withholdings associated with the new jobs. A company can use JDIG funds for any purpose.

Job Development Investment Grant (JDIG)

One NC is a discretionary cash-grant program that allows the Governor to respond quickly to competitive job-creation projects. The local government must provide an incentive to match the One NC funding. Awards are based on the number of jobs created, level of investment, location of the project, economic impact of the project, and the importance of the project to the state and region. Awards may be used for installation or purchase of equipment, structural repairs and renovations, and construction or improvements to utility lines and associated equipment in new or existing buildings.

One North Carolina Fund (One NC)

The standard deduction is $17,500 for married

couples, $14,000 for heads of household, and $8,750

for single taxpayers.

Personal Income Tax

5.499%(flat rate)

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