Texans looking to start a business in 2024 still have an advantage, a new study by Lendio revealed. However, it was better in Texas last year.
The Lone Star State, long a favorite for small businesses, lost to Florida this year the in ranking the best states for small businesses. It fell to second place, beating out North Carolina; Florida was second last year, according to Lehi, Utah-based Lendio, which helps businesses connect with lenders.
The rankings were based on an analysis of 10 metrics from government and nonprofit sources and Lendio’s internal data, including startup survival rates, access to business financing, favorable tax environments and cost of living, a press release stated.
Colorado, South Carolina, Ohio, Georgia, Massachusetts, Utah and Oklahoma also made the top 10 list. Hawaii, New Hampshire and Nebraska ranked as the bottom three states because of low business funding and venture capital availability, limited local incentive programs, high tax rates and high cost of living.
“Small businesses are a critical part of our economy, but they’ve faced unprecedented challenges in the past five years from a global pandemic to high interest rates,” stated Brock Blake, CEO and co-founder of Lendio, in a press release. “Despite these challenges, small business owners continue to fight for their dreams and start new businesses in record-breaking numbers. States that create a favorable business environment will benefit from the influx of small businesses opened in the past year.”
States with the highest ranking by individual metrics include:
- 5-year survival rate: Minnesota
- SBA loans approved/100K Population: Utah
- Loan offers received through Lendio’s marketplace/100K population: Wyoming
- Venture capital/$1 million GDP: Massachusetts
- Lowest corporate tax rate: Arkansas
- Most business incentives: Maryland
- Greatest population gains: Florida
- Most educated workforce mobility/100K population: Colorado
- Lowest housing costs: West Virginia
- Greatest personal consumption expenditures: California
See the full report for a breakdown of each state and the methodology behind the rankings.