The Best State To Launch A Startup

Entrepreneurs looking to form the next big startup need to think carefully about where to start up their company, with lots of factors that could influence their chances of success.

Around the US, there are definitely some states which offer a better environment in which to try and grow a business, so we’ve conducted the following analysis to try and find which are the best US states to launch a startup, looking at factors such as business survival rates, the number of new business applications and college graduates in the local area.


We compared each of the 50 US states on the following criteria, giving them a score out of 100 for each, before combining these ratings to reach a final weighted score out of 100.

New Business Applications

The number of new business applications made in the last four quarters, according to the United States Census Bureau.

New Business Applications Year on Year Growth

The year on year growth of new business applications made according to the United States Census Bureau.

Business Survival Rate

The percentage of businesses that opened in the year ending March 2013 which were still trading as of March 2018, according to the Bureau of Labor Statistics.

Rate of New Entrepreneurs

Percentage of the population who are “new business owners, including those who own incorporated or unincorporated businesses, and those who are employers or non-employers”, according to the Kauffman Indicators of Entrepreneurship.

Corporate Tax Rate

The lowest corporate tax rate according to the Tax Foundation. Note that while some states may not levy a corporate tax, they may have similar taxes such as a franchise tax or business & occupation tax and may also apply further taxes at a local level.

Share of College-Educated Population

The share of the population aged 25 years or older who hold a Bachelor’s Degree or higher, according to the United States Census Bureau.

Labor Cost

The average income per capita, according to the United States Census Bureau.

Cost of Living Index

Cost of Living Index according to World Population Review (where 100 = the US national average).

Don't forget that, soon after launching your startup, there's a good chance you'll need to choose the right POS system, credit card processing provider and more; all of which you can do here at Comparisun.