Apr 17, 2017

Study Reveals Best and Worst U.S. Cities to Start a Small Business

Holland, Michigan, is the best city in the U.S. to start a business, according to a study released by WalletHub Monday. The personal finance website analyzed the business-friendliness of 1,261 small cities to determine the best places for entrepreneurs to launch their businesses.

The study compared cities with a population of 25,000 to 100,000 residents in the city proper. The cities were rated on 16 relevant metrics in three key dimensions: business environment, access to resources and business costs. Some of the metrics include number of startups per capita, average revenue of businesses, investor access, working-age population growth, office-space affordability and cost of living.

Holland, the west Michigan community of 33,000 people was one of several Michigan communities to make the top 100 list. Carbondale, Illinois, and Springville, Utah, came in at second and third place respectively.

The study reveals that smaller cities offer greater chances of success for many types of startups. According to the report, cities with smaller populations offer business owners lower overhead costs, stronger relationships with customers and more potential to become a “big fish in a little pond.” On the flip side, entrepreneurs may find limited industry options, a less diverse customer base and difficulty attracting and retaining top talent, as well as difficulty cultivating a large professional network.

“If you are starting a business in a small city, my best advice is to network, network, network. Find the networks to the information you need and be active in promoting what you have to offer. Become local; promote local. Become a part of the local community and promote others in doing so. Connections are really the name of the winning game in a small city for small businesses,” said Connie Evans, President and CEO of the Association for Enterprise Opportunity.

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About the author

Melanie King
A storyteller since first grade, Melanie King has shaped a career around writing engaging narratives—though her illustrations haven’t improved much since age 6. As a reporter and editor, Melanie has written about everything from retail and tourism trends to economic development for regional newspapers, trade publications, and national magazines. As Lendio’s Director of Public Relations, she specializes in reporting fintech industry news and its impact on American small businesses. Melanie has a B.A. in Journalism from Brigham Young University. She is also a backpacker, runner, and mom of four.


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