Abbott highlights Texas AI boom, with Houston projects on the horizon

An aerial view of Stargate’s AI data center in Abilene. Photo courtesy OpenAI.

AI investments are booming in Texas, Gov. Greg Abbott says. And Houston is poised to benefit from this surge.

At a recent Texas Economic Development Corp. gathering in the Dallas-Fort Worth area, Abbott said AI projects on the horizon in the Lone Star State would be bigger than the $500 billion multistate Project Stargate, according to the Dallas Business Journal. So far, Stargate includes three AI data centers in Texas.

Stargate, a new partnership among OpenAI, Oracle, Softbank, and the federal government, is building AI infrastructure around the country. The project’s first data center is in Abilene, and the center’s second phase is underway. Once the second phase is finished, the 875-acre site will host eight buildings totaling about 4 million square feet with a power capacity of 1.2 gigawatts. An additional 600 megawatts of capacity might be added later.

On Sept. 23, Stargate announced the development of another five AI data centers in the U.S., including a new facility in Shackelford County, Texas, near Abilene. That facility is likely a roughly $25 billion, 1.4-gigawatt AI data center that Vantage Data Centers is building on a 1,200-acre site in Shackelford County.

Another will be in Milam County, between Waco and Austin. In conjunction with Stargate, OpenAI plans to occupy the more than $3 billion center, which will be situated on a nearly 600-acre site, the Austin Business Journal reported. OpenAI has teamed up with Softbank-backed SB Energy Global to build the facility.

Abbott said several unannounced AI projects in Texas — namely, data centers — will be larger than Stargate.

“Bottom line is ... when you look at diversification, the hottest thing going on right now is artificial intelligence,” Abbott said.

The Houston area almost certainly stands to attract some of the projects teased by the governor.

In Houston, Taiwanese tech manufacturer Foxconn already is investing $450 million to make AI servers at the 100-acre Fairbanks Logistics Park, which Foxconn recently purchased for a reported $142 million. The park features four industrial buildings totaling one million square feet. It appears Foxconn will manufacture the servers for Apple and Nvidia, both of which have announced they’ll open server factories in Houston.

The Foxconn, Apple, and Nvidia initiatives are high-profile examples of Houston’s ascent in the AI economy. A report released in July by the Brookings Institution identified Houston as one of the country’s 28 “star” hubs for AI.

The Greater Houston Partnership says the Houston area is undergoing an "AI-driven data revolution."

“As Houston rapidly evolves into a hub for AI, cloud computing, and data infrastructure, the city is experiencing a surge in data center investments driven by its unique position at the intersection of energy, technology, and innovation,” the partnership says.

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Houston's favorite gymnast is the chief impact officer on a California-based tech company that's raised $462M. Photo via getcerebral.com

Houston superstar Simone Biles snags C-suite position in SoftBank-backed company

flipping into tech

Less than two months after Olympic gymnastics star Simone Biles of Spring joined mental health startup Cerebral as chief impact officer, the company has raised $300 million in venture capital — a sum that vaulted it to a valuation of $4.8 billion.

San Francisco-based Cerebral announced the $300 million round December 8. SoftBank Vision Fund 2 led the Series C round, with participation from Prysm Capital, Access Industries, WestCap Group, and ARTIS Ventures.

Launched in January 2020, Cerebral has raised a total of $462 million from investors, including an undisclosed amount from Biles.

Biles, a 4-foot, 8-inch gymnastics powerhouse, has won 32 Olympic and World Championship medals. But it was her off-the-mat moves at this year’s Summer Olympics in Tokyo that drew worldwide attention. Biles contended in just one event in Tokyo after withdrawing from all other competition to concentrate on her mental health.

Two months after the Olympics, Biles agreed to become Cerebral’s chief impact officer, serving as the face of the brand.

Cerebral was an official sponsor of Biles’ Gold Over America Tour, which took place from September to November, and is an official sponsor of the 2022 Simone Biles International Invitational, a gymnastics competition that will be held January 27-30 at Houston’s George R. Brown Convention Center. The Spring-based World Champions Centre, Biles’ home gym, stages the invitational.

“Mental health is just as important as physical health, but for far too long the stigma of mental health has prevented too many people from seeking help,” Biles says in a Cerebral news release. “I have my own challenges with mental health, and therapy has been very empowering for me as I try to be the best person that I can be. I believe everyone should have access to mental health resources, and Cerebral gives me the ability to personalize my mental health care experience.”

Cerebral bills itself as a one-stop online shop for mental health care and wellness. The company offers counseling, therapy, and medication delivery and management online for conditions such as depression, anxiety, and substance abuse.

Cerebral boasts that the $300 million round makes it the world’s largest and fastest-growing online provider of mental health services.

“Cerebral’s growth in the last year shows just how much the world needs affordable and accessible mental health care. It’s important to us that we not only improve access to mental health care through a convenient platform and affordable plans, but to also improve patient outcomes,” says Kyle Robertson, co-founder and CEO of Cerebral.

The pandemic ramped up the use of telehealth services, including those delivered by Cerebral. According to Fortune Business Insights, the U.S. market for behavioral health grew 11.3 percent in 2020, with pandemic-fueled mental health concerns helping drive up demand. Fortune Business Insights estimates the U.S. market will expand from $77.62 billion in 2021 to $99.4 billion in 2028.

Globally, the mental health market is projected to jump from $383.31 billion in 2020 to $537.97 billion by 2030, according to Allied Market Research.

Digital health startups like Cerebral are benefiting from the mushrooming market for mental health. Rock Health, an investment and advisory firm, says that through the first nine months of 2021, investors pumped $21.3 billion into U.S. digital health startups. That compares with $14.6 billion in all of 2020.

Cerebral says its $300 million cash infusion will enable it to undertake a global expansion, as well develop strategic partnerships and explore M&A opportunities. Today, Cerebral comprises a network of over 2,300 clinicians practicing in all 50 states.

“Roughly half of the American population is affected by mental health issues. However, obstacles like cost, limited provider availability, and fear of judgment remain in the way of getting the treatment they need,” says Priya Saiprasad, a partner at SoftBank Investment Advisers, which manages SoftBank’s venture capital funds.

After relocating its headquarters to Houston, Katerra has filed for bankruptcy. Photo via Getty Images

New-to-Houston construction tech company files for Chapter 11 bankruptcy

bad news

Construction startup Katerra, which only recently moved its North American headquarters from Silicon Valley to Houston, filed for Chapter 11 bankruptcy June 6 — five days after news reports indicated the company was shutting down most of its U.S. operations.

Katerra's filings in U.S. Bankruptcy Court in Houston show the company and various affiliates have between $1 billion and $10 billion in liabilities and only $500 million to $1 billion in assets. In a June 6 news release, Katerra says it lined up $35 million in financing from a unit of Japan's SoftBank Group, the startup's largest investor.

Katerra recently notified its key stakeholders that many of its U.S. projects will be "demobilizing," according to the news release.

In an email sent June 1 to employees, Katerra said it would be winding down the majority of its U.S. operations and would lay off most of its U.S. employees. News website The Information first reported about the email. Globally, Katerra employs about 7,500 people.

Aside from letting go thousands of employees, Katerra is likely to walk away from dozens of construction projects it had agreed to build, The Information reported. As part of the bankruptcy case, Katerra plans to sell its renovation and Lord Aeck Sargent architecture businesses to unidentified buyers.

Katerra has been hemorrhaging money for months. In December, SoftBank pumped $200 million into Katerra, in addition to its previous investment of roughly $2 billion. Five months after Katerra received that cash infusion, Paal Kibsgaard stepped down as CEO, a role he'd held since July 2020. Kibsgaard is former chairman and CEO of Houston-based Schlumberger.

"The rapid deterioration of the company's financial position is the result of the macroeconomic effects of the COVID-19 pandemic on the construction industry, inability to procure bonding for construction projects following the unexpected insolvency proceedings of Katerra's former lender, and unsuccessful attempts to secure additional capital and business," according to the news release announcing the bankruptcy proceedings.

Greensill Capital, the lender referenced in the news release, filed for insolvency protection in March. Like Katerra, Greensill is backed by SoftBank.

Katerra was founded in 2015 with the intent to capitalize on technology — such as automation and robotics — in order to streamline construction. Its projects have included hotels and apartment buildings. Last year, it posted nearly $2 billion in revenue.

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With boost from Houston, Texas is the No. 1 state for economic development

governor's cup

Texas is on a 14-year winning streak as the top state for attracting job-creating business location and expansion projects.

Once again, Texas has claimed Site Selection magazine’s Governor’s Cup. This year’s honor recognizes the state with the highest number of economic development projects in 2025. Texas landed more than 1,400 projects last year.

Ron Starner, executive vice president of Site Selection, calls Texas “a dynasty in economic development.”

Among metro areas, Houston lands at No. 2 for the most economic development projects secured last year (590), behind No. 1 Chicago and ahead of No. 3 Dallas-Fort Worth.

In praising Houston as a project magnet, Gov. Greg Abbott cites the November announcement by pharmaceutical giant Lilly that it’s building a $6.5 billion manufacturing plant at Houston’s Generation Park.

“Growth in the Greater Houston region is a great benefit to our state’s economy, a major location for foreign direct investment and key industry sectors like energy, aerospace, advanced manufacturing, and life sciences,” Abbott tells Site Selection. “Houston is also home to one of the largest concentrations of U.S. headquarters for companies from around the world.”

In 2025, Fortune ranked Houston as the U.S. city with the third-highest number of Fortune 500 headquarters (26).

Texas retained the Governor’s Cup by gaining over 1,400 business location and expansion projects last year, representing more than $75 billion in capital investments and producing more than 42,000 new jobs.

Site Selection says Texas’ project count for 2025 handily beat second-place Illinois (680 projects) and third-place Ohio (467 projects). Texas’ number for 2025 represented 18% of all qualifying U.S. projects tracked by Site Selection.

“You can see that we are on a trajectory to ensure our economic diversification is going to inoculate us in good times, as well as bad times, to ensure our economy is still going to grow, still create new jobs, prosperity, and opportunities for Texans going forward,” Abbott says.

Houston e-commerce giant Cart.com raises $180M, surpasses $1B in funding

fresh funding

Editor's note: This article has been updated to clarify information about Cart.com's investors.

Houston-based commerce and logistics platform Cart.com has raised $180 million in growth capital from private equity firm Springcoast Partners, pushing the startup past the $1 billion funding mark since its founding in 2020.

Cart.com says it will use the capital to scale its logistics network, expand AI capabilities and develop workflow automation tools.

“This investment will strengthen our balance sheet and provide us with the flexibility to accelerate our strategic priorities,” Omair Tariq, CEO of Cart.com, said in a news release. “We’ve built a platform that combines commerce software with a scaled logistics network, and we’re just getting started.”

In conjunction with the funding, Springcoast executive-in-residence Russell Klein has been appointed to Cart.com’s board of directors. Before joining Springcoast, he was chief commercial officer at Austin-based Commerce.com (Nasdaq: CMRC). Klein co-led Commerce.com’s IPO, led the company’s mergers-and-acquisitions strategy and played a key role in several funding rounds.

“The team at Cart.com has demonstrated excellence in their ability to scale efficiently while continuing to innovate,” Klein said. “I’m excited to join the board and support the company as it expands its AI-driven capabilities, deepens enterprise relationships, and further strengthens its position as a category-defining commerce and fulfillment platform.”

Before this funding round, Cart.com had raised $872 million in venture capital and reached a valuation of about $1.6 billion, according to CB Insights. With the new funding, the startup has collected over $1 billion in just six years.

This is the income required to be a middle class earner in Houston in 2026

Cashing In

A new study tracking the upper and lower thresholds for middle class households across the nation's largest cities has revealed Houstonians need to make at least a grand more than last year to maintain their middle class status this year.

According to SmartAsset's just-released annual report, "What It Takes to Be Middle Class in America – 2026 Study," Houston households need to make anywhere from $42,907 to $128,722 to qualify as middle class earners this year.

Compared to 2025, Houstonians need to make $1,153 more per year to meet the minimum threshold for a middle class status, whereas the upper bound has stretched $3,448 higher. The median income for a Houston household in 2024 was $64,361, the study added.

SmartAsset's experts used 2024 Census Bureau median household income data for the 100 biggest U.S. cities and all 50 states and determined middle class income ranges by using a variation of Pew Research's definition of a middle class household, stating the salary range is "two-thirds to double the median U.S. salary."

In the report's ranking of the U.S. cities with the highest household incomes needed to maintain a middle class status, Houston ranked No. 80.

In the report's state-by-state comparison, Texas has the 24th highest middle class income range. Overall, Texas households need to make between $53,147 and $159,442 to be labeled "middle class" in 2026. For additional context, the median income for a Texas household in 2024 came out to $79,721.

"Often, the expectations that come with the term 'middle class' include reaching home ownership, raising kids, the comfort of modest emergency funds and retirement savings, and the occasional splurge or vacation," the report said. "And as the median household income varies widely across the U.S. depending on the local job market, housing market, infrastructure and other factors, so does swing the bounds on what constitutes a middle class income in America."

What it takes to be middle class elsewhere around Texas

Two Dallas-Fort Worth suburbs – Frisco and Plano – have some of the highest middle class income ranges in the country for 2026, SmartAsset found.

Frisco households need to make between $96,963 and $290,888 to qualify as middle class this year, which is the third-highest middle class income range nationwide.

Plano's middle class income range is the eighth highest nationally, with households needing to make between $77,267 and $231,802 for the designation.

Salary range needed to be a middle class earner in other Texas cities:

  • No. 28 – Austin: between $60,287 and $180,860
  • No. 40 – Irving: between $56,566 and $169,698
  • No. 44 – Fort Worth: between $55,002 and $165,006
  • No. 57 – Garland: between $50,531 and $151,594
  • No. 60 – Arlington: between $49,592 and $148,77
  • No. 61 – Dallas: between $49,549 and $148,646
  • No. 73 – Corpus Christi: between $44,645 and $133,934
  • No. 77 – San Antonio: between $44,117 and $132,352
  • No. 83 – Lubbock: between $41,573 and $124,720
  • No. 84 – Laredo: between $41,013 and $123,038
  • No. 89 – El Paso: between $39,955 and $119,864
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This article originally appeared on CultureMap.com.

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