The 2013 Kauffman Index of Entrepreneurial Activity (published by the Kauffman Foundation) has named the top 10 entrepreneurial states in the U.S. This means that there was more active business startup activity in these 10 states than anywhere else in the country:

  1. Montana: Montana’s start up growth has been exponential over this past year, rising to number one all the way from a 17th place ranking for 2011. This is due in part to the state’s booming oil and gas industry, with many businesses emerging around the Bakken fields in northeast Montana. The state also features a growing technology hub centered in Bozeman.
  2. Vermont: The state of Vermont has become a center for technology, biotech, and life science startups over the past year. This is due to a robust venture capital network combines with the availability of small business loans. In addition, the state has recently passed favorable patent laws for entrepreneurs.
  3. New Mexico: New Mexico has long been a home to small businesses and startups, and also attracts many young technology and biotech companies through its two federally funded R&D labs: Sandia and Los Alamos National Laboratories. There is also a strong mentorship network throughout the state, as many retired CEOs have relocated here.
  4. Alaska: Since the state of Alaska still lacks many services common to the rest of the United States, there’s lots of potential for business startups here. In addition, major Alaskan cities are offering further incentives for startups by offering $13.2 million in loans.
  5. Mississippi: Not only has this state long been a magnet for small businesses, but many entrepreneurs are being drawn to Mississippi of late due to its growing telecom, tech, oil & gas, and biomass energy industries. As an added attraction, cost of living is lower here than elsewhere.
  6. California: Beyond Silicon Valley, California has become home to a wide range of business startups. The state offers many advantages to fledgling entrepreneurs, including a strong talent base, a robust venture capital network, and a big consumer market.
  7. Idaho: In recent years, the state of Idaho has become a strong center for technology and science startups. This has been bolstered by unique initiatives offered by the state, including the Boise Metro Chamber of Commerce’s “B Launched” entrepreneurial funding competition and various tax credits.
  8. Hawaii: While tourism and defense have been the traditional business drivers in Hawaii, various public and private initiatives are attracting technology startups as well.
  9. Louisiana: Louisiana continues its rich tradition of fostering young businesses, both in the fishing and oil and gas industries as well as technology, life sciences, music, and entertainment sectors. Sales tax rebates and other incentives have been attracting more entrepreneurs of late.
  10. Nevada: Over the past year, Nevada’s business friendly environment (there’s no personal or business income taxes) has attracted a wide range of entrepreneurs involved in everything from retail to tech, aerospace, energy, and defense. The state also recently set up a $10 million catalyst fund to aid in small business relocation and expansion.

The Kauffman Foundation bases its 2012 startup rating for each state on a yearly national survey of around a half million adults ages 20 to 60 who invested 15 hours or more into a new business.


Kavilanz, Parija. “Best Places to Launch: 10 Most Entrepreneurial States.” CNN Money. 6/20/13.