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Starting a successful business is a challenge in any sense, regardless of where you are. According to figures from the Bureau of Labor Statistics, just over one-fifth of businesses don’t survive to the end of their second year, an average going back to at least 1994.1

However, certain locations offer advantages over others, with factors like the prevalence of self-employment and employment in startups, LLCs and other small businesses serving as useful indicators of where in the country it might be best to make entrepreneurial headway. 

Our team examined key metrics of 46 of the most popular cities in the United States, from Miami to Washington and plenty in between, to find which cities are the best to start a business in.

Key takeaways 

Here are some of the standout statistics and key takeaways from our analysis of the best cities to start a business:

  • Austin, Texas, is the best city in the U.S. to start a business: It ranks in the top 10 for five out of the eight factors we assessed using data from reputable sources. This includes the percentage of employment in startups (5.03%)2 and GDP growth (14.3%).3
  • Miami, Florida, offers excellent opportunities and a high success rate for businesses: It ranks highest overall for net business openings and entry rates, according to the United States Census Bureau.2 It also ranked best for unemployment numbers.4 However, it also has the fifth-worst exit rate,2 showing that sustaining a business over a long period of time might be a challenge.
  • New York City is ranked 42nd out of the 46 cities we surveyed: It falls outside the top 20 in each category we examined. While more businesses were established in the city than anywhere else, an even greater number of enterprises failed, giving it the worst turnover rate of all the cities on our list.2
  • Los Angeles, California, ranked the best for entrepreneurs: This is based on the percentage of total employment (15.63%).5 However, it has the third-lowest net business openings.2 
  • Startups are a bigger source of employment in Colorado Springs, Colorado, than anywhere else: 5.66% of the total employment in the city is employees working at businesses that are under one year old.2

The top 10 cities to start a business in the US

Here is our list of the top 10 cities to start a business in the U.S., based on our extensive research: 

  • Austin, Texas.
  • Miami, Florida. 
  • Nashville, Tennessee. 
  • Dallas, Texas.
  • Atlanta, Georgia. 
  • Phoenix, Arizona.
  • Jacksonville, Florida.
  • Raleigh, North Carolina.
  • Houston, Texas.
  • Tampa, Florida.

Our expert analysis of 46 of the most popular cities across the country revealed Austin, Texas, to be the best place to start a business in the U.S. Austin has the second-highest ranking for the percentage of total employment in startups2 and GDP growth between 2021 and 2022.3 This and other factors cement its top position as a city that encourages innovation and entrepreneurship.

While it didn’t finish at the top in any ranking, the Texas city was the strongest performer. Austin ranked in the top 10 for five out of eight factors assessed by our analysts, including business entry rate,2 net business openings2 and percentage of households reporting self-employment income.5 

Miami, Florida, was a close second and the only city in the top five to have a number-one ranking in any category. In fact, Miami was the best city for net business openings2 and business entry rate,2 and it had the lowest unemployment rate as of January 2024.4 

With the second-best unemployment rate (of January 2024)4 and the second-highest percentage of households with self-employment income,5 Nashville, Tennessee, ranked as the third-best city. Nashville also has the sixth-highest percentage of employees working in startups.2 Combined with solid GDP growth — 13%, eighth overall3 — it represents a stable economic environment for new businesses.

Dallas, Texas, and Atlanta, Georgia, make up the rest of the top five, with the former marking the second of Texas’ three contributions to the top ten list. Dallas stands out with the third-highest number of net business openings2 and the fifth-highest percentage of total employment in startups,2 suggesting a supportive environment for new businesses.

Texas and Florida both have three cities in the top ten, with Tampa (tenth) and Houston (ninth) making up the last two positions. Jacksonville (seventh) is the only city in the top 10 aside from Miami to finish at the top in any specific ranking, coming first for its net job creation rate.2 Jacksonville is also the only city in the top 10 with a positive net job creation rate.2 

Phoenix, Arizona, and Raleigh, North Carolina, are also on the list. Phoenix has the third-best net job creation rate2 and the fifth-highest net business openings.2 Raleigh offers an impressive net job creation rate2 and a high percentage of total employment in startups.2

The cities with the most businesses opening vs. closing

A high number of net business openings is a strong indicator that a city fosters an environment for entrepreneurship and stability. Miami takes the top spot for this metric, with around 7,350 more businesses opening than closing.2 The city also had the highest number of business openings in the top 10 and the third-highest in the full list behind New York City and Los Angeles.2 

Setting it apart from two of the country’s biggest metropolises is Miami’s ability to sustain businesses, likely bolstered by its high rate of employment in startups2 and the low unemployment rate as of January 2024 (the lowest of all cities on this list).4

Just like in our top 10 list, Texas and Florida both dominate the top 10 list for net business openings. This shows that both states offer plenty in the way of encouraging new businesses and providing the right conditions for them to stay open. 

Startups in Miami, Austin and Dallas are particularly high contributors to their city’s total employment numbers.2 These cities also — alongside Houston and Jacksonville — make up five of the top 10 in terms of GDP growth.3

Atlanta is also a strong performer, with the second-highest number of net business openings2 and the third-highest business opening rate.2 While Atlanta also had a high percentage of employment in startups2 and a low unemployment rate as of January 2024,4 the city’s GDP was outside of the top 20.

On the other side of the scale, entries of interest in the bottom five include New York City, Chicago and Boston. These cities are established centers of business with competitive markets alongside relatively high living costs, factors that may not necessarily help new businesses thrive. All three of these cities rank poorly for rates of job creation,2 business closures2 and overall GDP growth from 2021 to 2022.3 

It’s worth noting, however, that despite the relatively low rate of new business openings in Los Angeles and San Francisco,2 both cities are in the top three in terms of the percentage of households with self-employment income.2

Cities with the most entrepreneurs 

Our research found that California does seem to have a lot of entrepreneurs, with many entries in the top 10 of percentage of households with self-employment income. Those cities include:2

  • Lost Angeles: 15.63% of households with self-employment income. 
  • San Francisco: 13.71% of households with self-employment income.
  • San Diego: 13.27% of households with self-employment income.

However, none of these cities rank particularly highly when it comes to the percentage of total employment in startups, each with less than 4%.2 They also have some of the highest rates of business closings,2 despite San Diego and Los Angeles being in the top 15 for business openings.2

In 2019, California introduced the landmark bill AB5 that allows gig workers to get holiday and sick pay from employers like Uber and Lyft.6 While self-employment might be encouraged in the state, the competitive nature and saturation of the market might make it more difficult for startups and small businesses to break through.

Texas is represented twice, with Austin (13.17%) and Dallas (12.51%) having relatively high percentages of households declaring self-employment income,2 though both came behind Nashville’s 14.41% and Miami’s 13.25%.2 Austin and Dallas also rank highly for the number of new business openings, a metric topped by Miami.2

However, Austin and Dallas rank fairly average in terms of the rate of businesses closing, while Miami is in the bottom five.2 Sacramento, California, Portland, Oregon and Denver, Colorado, make up the top 10, with all cities having more than one in ten households earning self-employment income.2

The cities with the highest employment in startups 

A key factor in starting and sustaining a new business is the ability to scale, and having a ready and willing employee market can be a major contribution. If you’re looking for a city with a high percentage of its population already engaging with startups, Colorado Springs offers the highest rate of employment in startups of any city we looked at.2 

Around 5.66% of total employment in Colorado Springs is in startups, ahead of Austin (5.03%), Las Vegas (4.94%) and Miami (4.64%).2 Colorado Springs also ranks highly for its net job creation rate — second in our whole list — and has a decent business entry rate.2 However, relatively average to poor performances in other metrics, including the rate at which businesses close (36th out of 46)2 and overall GDP growth from 2021 to 20223 (41st out of 46) are significant weaknesses.

While there are many strong performers in the top 10 for highest percentage of employment in startups, Las Vegas and Bakersfield, California, both stand out from the crowd. These cities have a relatively high proportion of their workforce in startups; however, Las Vegas is 20th on our overall list, and Bakersfield is 26th.2 

Both cities are in the bottom five in terms of unemployment, with Bakersfield being at the bottom of the list by a wide margin, with a 9.5% unemployment rate as of January 2024.4 Las Vegas also ranks the worst out of any of the cities for job creation2 and very poorly for the rate of businesses closing.2 Yet Las Vegas has the fourth highest GDP growth of any city and Bakersfield has the tenth.3

Start your next business with confidence

Starting a business and sustaining it is a major challenge, and there are a vast number of factors that can affect your chances of success. While the best businesses and entrepreneurs can succeed anywhere and beat any odds, it can help to think about where your business might be more likely to succeed. 

Remember, all cities present unique opportunities and challenges. While Austin’s impressive GDP growth3 and high percentage of employment in startups2 will appeal to some, others may place more importance on unemployment levels or the rate of business failures as indicators of future success. 

Additionally, cities and states often differ in terms of legislation and regulation, so consider where certain restrictions may hamper your business and whether you’ll need specific LLC services for your business.

The U.S. offers opportunities for everyone, but it takes plenty of time, effort and dedication to start a business successfully. So it’s always worth being informed about any factors that could affect your success.


Our team examined and evaluated figures from the most populous cities, sourcing statistics from reputable sources like the United States Census Bureau and the United States Bureau of Labor Statistics. We graded metrics within each factor we assessed on a 100-point scale and calculated each city’s overall score through a weighted average across all metrics. The factors we analyzed were:

  • Net establishment births (20%): The number of businesses that opened minus those that closed in 2021, sourced from the Census Business Dynamics Survey of 2021. The higher the net establishment, the better a city scored.
  • Net job creation rate (10%): The number of jobs created minus the number of jobs eliminated in 2021, sourced from the Census Business Dynamics Survey of 2021. The more jobs created, the better a city scored.
  • Establishment entry rate (10%): The number of new business openings per 100 existing establishments in 2021, with more new businesses resulting in higher scores.
  • Establishment exit rate (10%): The number of business closures per 100 establishments in 2021, with fewer closures yielding a better score.
  • Employment in startups (10%): This was the percentage of all employees in the city who worked at businesses younger than a year old. Higher percentages meant a higher overall score for the city.
    Percentage of households reporting self-employment income (15%): The percentage of households in the city that received self-employment income, sourced from the Census ACS 2022, with higher percentages resulting in better city scores.
  • Unemployment rate (10%): We used the unemployment data from January 2024.
    GDP Growth, 2021 to 2022 (15%): Annual growth in gross domestic product between 2021 and 2022, sourced from the BEA 2022.


  1. U.S. Bureau of Labor Statistics - Survival of private sector establishments by opening year.
  2. U.S. Census Bureau - Job Creation.
  3. Bureau of Economic Analysis - Gross Domestic Product by County and Metropolitan Area, 2022.
  4. U.S. Bureau of Labor Statistics - Local Area Unemployment Statistics.
  5. U.S. Census Bureau - Self-Employment Income in the Past 12 Months for Households
  6. State of California: Department of Industrial Relations - Independent contractor versus employee.

Blueprint is an independent publisher and comparison service, not an investment advisor. The information provided is for educational purposes only and we encourage you to seek personalized advice from qualified professionals regarding specific financial decisions. Past performance is not indicative of future results.

Blueprint has an advertiser disclosure policy. The opinions, analyses, reviews or recommendations expressed in this article are those of the Blueprint editorial staff alone. Blueprint adheres to strict editorial integrity standards. The information is accurate as of the publish date, but always check the provider’s website for the most current information.

Mehdi is a writer and editor with many years of personal finance expertise under his belt. He's a spirited money-saver, with a passion for making personal finance accessible and manageable. When he isn't writing, Mehdi likes to read about history and travel, hike along coastlines and in forests, and watch his beloved team Manchester United underperform.

Sierra Campbell is a small business editor for USA Today Blueprint. She specializes in writing, editing and fact-checking content centered around helping businesses. She has worked as a digital content and show producer for several local TV stations, an editor for U.S. News & World Report and a freelance writer and editor for many companies. Sierra prides herself in delivering accurate and up-to-date information to readers. Her expertise includes credit card processing companies, e-commerce platforms, payroll software, accounting software and virtual private networks (VPNs). She also owns Editing by Sierra, where she offers editing services to writers of all backgrounds, including self-published and traditionally published authors.