There’s a reason for the old saying, “Location, location, location.” If you’re an entrepreneur, putting some thought into where you launch your business can make the difference between growing your efforts or closing within the year. Here are our 10 best cities for entrepreneurs:
To determine the top cities for entrepreneurs, consider the factors that make the city a good place for a startup. For example think about the regional job market, investor opportunities, and the area’s cost of living.
10. Miami and Surrounding Metro Area, Florida
Miami may be known for its nightlife, but it also has a strong economy that could be a perfect location for a start-up business. With a population of over 6 million people in this metro area, there are prime opportunities for networking, potential customers and employees. In fact, 9.39% of area workers are already employed by startups.
One thing to note is that the cost of living in Miami is 123.1, about 23 points higher than the national average. Investopedia, however, reports that some of this overage can be attributed to the city’s high-dollar neighborhoods and that it is possible to find more affordable housing. That said, unless you have substantial savings, Miami may be best for entrepreneurs who are starting second businesses or who are already financially established.
9. Raleigh, North Carolina
Raleigh’s location and low cost of living make it not only a desirable place to reside but also a favorable city to start a business. Because of the area’s many educational institutions, 38.11% of the population from ages 18-34 have a bachelor’s degree or higher, making this a prime place to find highly skilled employees for specific business needs.
North Carolina also enjoys the lowest corporate income tax rate in the country, levying just a 2.5% tax rate on businesses. Combine that with a cost of living that is just 2.3% higher than the national average and Raleigh is a smart choice for financially savvy entrepreneurs.
8. San Antonio, Texas
Starting a business in Texas is not uncommon, with the state having the third-highest number of new business applications in April 2021. San Antonio and the surrounding metro area also have a population of just over 2.5 million, which means great potential for finding employees and customers. The area’s cost of living is 10.3% lower than the national average, making this a prime location to live and build a business.
7. Tampa and Surrounding Metro Area, Florida
Another city in Florida makes the list, for good reason. Florida was ranked the second best state for business in 2020 according to Chief Executive Magazine. Starting a business in Tampa may make it easier to connect with fellow entrepreneurs since 5.4% of the population is self-employed workers, one of the highest proportions among the ranked cities. With the cost of living hovering around the national average, Tampa is one of the top cities for entrepreneurs.
6. Houston, Texas
The largest city in the state and the most populated, Houston provides a highly sought-after metro to start a business. Houston is home to the world’s second-largest port, which offers robust resources for the area’s small business owners.
Additionally, startups may find it easier to connect with investors here since venture capital funding in the area’s small businesses has rapidly increased over the past four years. In fact, between 2016 and 2020, VC investments in Houston have seen an annual growth rate of 66%! Additionally, Houston’s cost of living is 3.5% lower than the national average, making it a wise financial choice for budding entrepreneurs.
5. Orlando and Surrounding Metro Area, Florida
Known for its theme parks, the Orlando area may not be the first place you think of as an entrepreneur but it should be on your list for consideration. With the second-highest percentage of people self-employed at 6.03%, Orlando can be a great place for an entrepreneurial journey to begin. While Orlando has a slightly higher cost of living at 4% above the national average, it is still a relatively economical place to live considering the business perks.
4.Jacksonville, Florida
Located on the Atlantic coast in Northeast Florida, Jacksonville is home to beaches, eclectic restaurants and shops and a younger population. The median age of residents in Jacksonville is 38 years old as opposed to 42 for the rest of the state. More than a quarter of the businesses in Jacksonville are startups, and they employ 6.1% of the area’s workforce. With a cost of living that falls 6.5% below the national average, Jacksonville can be a worthy contender for one of the best places for entrepreneurs to live.
3. Dallas-Fort Worth-Arlington, Texas
Home to more than 40 colleges, this metro area provides ideal candidates for a startup with 26.35% of the population having a bachelor’s degree or higher. Employees are receptive to working for startups since 7.04% of workers in the area are employed by one.
Not only may it be easier to find skilled employees, but receiving large amounts of capital is a possibility as well. According to a Crunchbase report, $6.5 billion was invested in startups in the Dallas-Fort Worth area between 2010-2019. The Dallas-Fort Worth area is also a financially sound place to do business. The cost of doing business in DFW is 2-7% lower than the national average. This includes costs for state and local taxes, labor, and rent.
2. Atlanta, Georgia
Atlanta may be home to major corporations like Coca-Cola and Home Depot but it also provides a favorable environment for startups. Nearly 25% of the businesses in Atlanta are startups. In addition, the metro area has almost 6 million residents with 28.75% having a bachelor’s degree or higher, perfect for finding talent for your business.
Atlanta can also be an attractive place if your goal is to get venture capital funding. In 2020, funding for venture-backed startups reached $1.9B across 188 deals. Additionally, the area is home to 40 corporate innovation centers, which can be particularly helpful for finding talent or even eventually selling your company.
1. Austin, Texas
Austin is no doubt a popular city. The Texas state capital ranked third for best places to live for 2020-2021 by U.S. News and World Report and people flock to it for its live music, culture and outdoor activities.
Startups are welcomed here since 8.61% of workers are employed by one and 28.14% of businesses were started within the last three years. In Austin, you likely won’t have a hard time finding new talent for your startup as there are over 400,000 college students within a 100-mile radius of the city! In fact, if you’re looking for a young talent pool, Austin is where it’s at. The median age in the city is 35, making the metro area the fifth-youngest among major metros.
The city government is highly supportive of small businesses. The Chamber provides a robust list of resources and grants to help entrepreneurs kick start or grow their business and has a dedicated team to innovation that provides support for raising capital, working with universities, and attracting talent. With all that Austin has to offer it makes this city one of the best places for entrepreneurs to live.
Conclusion
Starting your own business can be an incredibly exciting time. While all of the cities on this list are a great option for entrepreneurs, it doesn’t mean you have to be located in one of these locales to be a successful entrepreneur. Whether you’re just starting out or already in hyper-growth mode, be sure to stay connected to the startup community in your area to set yourself up for success.