A recent study by NerdWallet looked at the best places in the country to currently launch a startup. The study looked at several different factors that would affect the setup of a new business, including access to funding and labor, population growth between 2007–2012, unemployment rate, per capita income, the overall cost of living in the geographical area, and the number of businesses per 100 residents. Here are the 10 best cities in the U.S. to launch a small business venture.
- Oklahoma City, Oklahoma: One of the biggest factors that has spurred entrepreneurship in Oklahoma City has to do with the increasing availability of small business lending. This combined with a low cost of living and relatively low income tax has attracted numerous new startups, particularly in the healthcare, biotech, and technology industries.
- Miami, Florida: The biggest driver of entrepreneurial growth in Miami is its recent rapid population growth, with transplants coming from Cuba, Colombia, Argentina, Mexico, and Venezuela who are very entrepreneurial by nature. There are also several incubators in the city helping to foster small business growth.
- Omaha, Nebraska: Compared to other large U.S. cities, startup costs and the overall cost of living are relatively low in Omaha. In addition, there is great institutional support for startups in the city, including a robust small business network, active accelerators, and the presence of Fortune 500 companies in the city.
- Raleigh, North Carolina: Raleigh offers an ideal mix of established global companies and a thriving entrepreneurial community. In addition, Raleigh offers three major universities (known as the Research Triangle), which are able to provide key support in the technology, medical care, and clean tech industries.
- Nashville, Tennessee: Nashville offers available funding (through the Nashville Business Incubation Center) and zero state tax, making this an ideal location for new startups. In addition, there are six major colleges that are continuously generating an educated workforce for the labor pool. Healthcare is one of the largest and fastest growing industries in Nashville.
- Atlanta, Georgia: One of the biggest factors driving startup business growth in Atlanta is the city’s well-educated population, with over 47 percent of residents over 25 holding a bachelor’s degree or higher. In addition, Atlanta has made significant efforts to increase startup activity, offering tax rebates and streamlining the business license process.
- Austin, Texas: Austin has recently been growing as an entrepreneurial hub due to several factors, including the city’s low unemployment rate, low cost of living, and highly educated population. In addition, Texas is one of the few states that has no individual or corporate income tax.
- Seattle, Washington: While Seattle has long been the home to corporate pioneers such as Microsoft, Starbucks, Costco, and Amazon, it also offers a robust pipeline of private sector funding and a strong mentoring network for new startups. Currently hot industries for startup activity include tech, aerospace, fashion design, and gaming.
- Denver, Colorado: One of the biggest things Denver has going for it is that it offers the second-most educated workforce in the country, making this a hot city for entrepreneurial activity. The city also provides a very supportive business development environment.
- Memphis, Tennessee: Entrepreneurs and startup owners are currently supported by various city initiatives, making Memphis a viable place to launch a new business. This includes several incubators and accelerators. In addition, the cost of starting a business in Memphis is relatively low.
NerdWallet’s May 2014 study looked at 50 of the largest U.S. cities.
Kavilanz, Parija. “10 Best Cities to Launch a Startup.” CNN Money. 7/9/14.