Growing a Business

The 10 Best States to Start a Small Business

The 10 Best States to Start a Small Business
Image credit: Shutterstock
Entrepreneur Staff
Staff Writer. Covers leadership, media, technology and culture.
3 min read

There are many variables that can help determine whether your business has a chance at success: the state of the market, your competition, the way you build your team and the way you message your product, just to name a few. But another factor that should be considered by anyone starting a company is the kind of guidance you receive from your state and city governments.

A recent survey of nearly 18,000 U.S. business owners showed that, among all of the things that make a state or city “small-business friendly,” offering training on business development was the most important factor to businesses. Conducted by professional marketplace Thumbtack, the survey found that governments that provide classes and training to help get entrepreneurs acquainted with local economic and policy rules, and lay out those requirements in easy-to-navigate steps on their websites, got the highest rankings.

Related: Which One of These Growth Curves Are You Following?

Licensing, labor and tax regulations were also among the key drivers of perceived business friendliness.

The survey, now in its fourth year, asked businesses to answer 36 questions related to everything from labor rules to licensing rules. While businesses in all 50 states were surveyed, only states with more than 50 responses and cities with more than 30 were given a small-business friendly grade.

For a look at the 10 best states to start a business, check out the slideshow below. To learn about the methodology behind the study, read more here.

Related: Putting People Over Profit in Business and Life

The 10 Best States to Start a Small Business

Texas

Texas
Image credit: Shutterstock

Overall grade: A+

Best: A+ for overall friendliness to small businesses 
Worst: B for the ease of the hiring process 

The 10 Best States to Start a Small Business

New Hampshire

New Hampshire
Image credit: Shutterstock

Overall grade: A+

Best: A+ for the ease of launching a business
Worst: B- for environmental regulations 

The 10 Best States to Start a Small Business

Utah

Utah
Image credit: Shutterstock

Overall grade: A+ 

Best: A+ for zoning regulations
Worst: B for the ease of launching a business 

The 10 Best States to Start a Small Business

Louisiana

Louisiana
Image credit: Shutterstock

Overall grade: A

Best: A+ for employment, hiring and labor regulations
Worst: B for zoning regulations 

The 10 Best States to Start a Small Business

Colorado

Colorado
Image credit: Shutterstock

Overall grade: A

Best: A for overall friendliness to small businesses 
Worst: C for health and safety regulations

The 10 Best States to Start a Small Business

Idaho

Idaho
Image credit: Shutterstock

Overall grade: A

Best: A+ for networking and training programs 
Worst: C- for ease of the hiring process 

The 10 Best States to Start a Small Business

Tennessee

Tennessee
Image credit: Shutterstock

Overall grade: A

Best: A for overall friendliness to small businesses 
Worst: F for networking and training programs 

The 10 Best States to Start a Small Business

Virginia

Virginia
Image credit: Shutterstock

Overall grade: A

Best: A for health and safety regulations
Worst: A- for networking and training programs 

The 10 Best States to Start a Small Business

Georgia

Georgia
Image credit: Shutterstock

Overall grade: A

Best: A for the ease of launching a business
Worst: C+ for networking and training programs

The 10 Best States to Start a Small Business

Kansas

Kansas
Image credit: Shutterstock

Overall grade: A

Best: A+ for tax code
Worst: F for networking and training programs

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  • The 10 Best States to Start a Small Business
  • 1. Texas
  • 2. New Hampshire
  • 3. Utah
  • 4. Louisiana
  • 5. Colorado
  • 6. Idaho
  • 7. Tennessee
  • 8. Virginia
  • 9. Georgia
  • 10. Kansas
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