As a record number of businesses opened last year, Lendio reveals the top states to start a small business.
2023 was a record-breaking year for small businesses as a record-breaking 5.5 million new business applications were filed in 2023, according to the Small Business Administration.
The 2020s have been one of the most challenging historical decades for small business owners. The economic impact of the global pandemic continues to ripple through the American and global economies. Inflation, high interest rates, and the unprecedented migration of educated workers to new locations have been just a few of the challenges that small businesses face. Amid such paradigm shifts in how—and where—Americans work and live, Lendio commissioned this study to see the state of the small business landscape across the country.
We explored trends in ten metrics that are critical to the success of small business owners in 2024’s rapidly changing and uncertain landscape. These metrics included small business lending, cost of living, real estate data, educated worker migration, corporate tax rates, state-level incentives for business owners, and more. Our key findings include:
2023 was a record-breaking year for small businesses as a record-breaking 5.5 million new business applications were filed in 2023, according to the Small Business Administration.
The 2020s have been one of the most challenging historical decades for small business owners. The economic impact of the global pandemic continues to ripple through the American and global economies. Inflation, high interest rates, and the unprecedented migration of educated workers to new locations have been just a few of the challenges that small businesses face. Amid such paradigm shifts in how—and where—Americans work and live, Lendio commissioned this study to see the state of the small business landscape across the country.
Key Findings
We explored trends in ten metrics that are critical to the success of small business owners in 2024’s rapidly changing and uncertain landscape. These metrics included small business lending, cost of living, real estate data, educated worker migration, corporate tax rates, state-level incentives for business owners, and more. Our key findings include:
- Top states – Florida, Texas, and North Carolina rank top in our list due to lower taxes, an influx of movers to these states, sufficient business funding, and higher amounts of personal consumption expenditures.
- Bottom states – Hawaii, New Hampshire, and Nebraska are the bottom three states, due to low business funding and venture capital availability, limited local incentive programs, high tax rates, and high cost of living.
- Ranking shifts – While the states that made the top 10 stayed the same from Lendio’s 2023 analysis, there were some shifts in the line-up including Florida edging out Texas for the top spot.
- Ranking factors – The states that rank highest are those that experienced large influxes of migration, with reasonable costs of living. The availability of business funding, venture capital, and local incentive programs were also important factors that impacted the rankings.