2019’s Best & Worst States to Start a Business

Written By: Adam McCann, Financial WriterPublished By: WalletHub 7-18-2109

STARTING A BUSINESS:

Starting a business is never easy. According to U.S. Bureau of Labor Statistics data, about a fifth of all startups typically don’t survive past year one of operation, and nearly half never make it to their fifth anniversary.But startups fail for different reasons, a “bad location” among the most common. Choosing the right state for a business is therefore crucial to its success. A state that provides the ideal conditions for business creation — access to cash, skilled workers and affordable office space, for instance — can help new ventures not only take off but also thrive.In this study, WalletHub compared the 50 states across 26 key indicators of startup success to determine the most fertile grounds in which to launch and grow an enterprise. Read on for our findings, business insight from a panel of experts and a full description of our methodology.

Main Findings

Overall Rank (1=Best)	State	Total Score	‘Business Environment’ Rank	‘Access to Resources’ Rank	‘Business Costs’ Rank
1	Texas	61.05	1	11	30
2	Utah	60.95	7	2	26
3	Georgia	58.12	5	17	13
4	North Dakota	57.68	2	19	32
5	Oklahoma	57.58	8	36	1
6	Florida	56.75	4	20	21
7	Arizona	54.39	9	12	29
8	California	54.30	3	3	46
9	Montana	53.71	11	30	8
10	Colorado	52.67	6	18	34
11	Idaho	52.10	12	44	7
12	Washington	52.00	13	1	43
13	Mississippi	51.39	28	26	2
14	North Carolina	50.86	24	10	22
15	Louisiana	50.36	15	37	17
16	Kansas	50.33	17	27	20
17	Minnesota	50.32	21	5	35
18	Michigan	50.19	31	23	6
19	Nebraska	50.09	25	21	9
20	Tennessee	49.11	16	42	19
21	Kentucky	49.00	26	40	5
22	South Dakota	48.57	38	33	4
23	Maine	48.56	18	45	14
24	Indiana	48.48	33	29	11
25	Nevada	47.85	14	47	28
26	Oregon	47.80	19	13	33
27	New Mexico	47.69	34	28	18
28	Alaska	47.06	10	16	45
29	Alabama	46.82	36	38	10
30	Wisconsin	46.61	29	31	24
31	Arkansas	46.60	32	43	12
32	Missouri	46.46	35	25	25
33	Wyoming	46.22	20	39	31
34	Ohio	46.05	42	35	16
35	Illinois	45.33	43	8	40
36	Massachusetts	45.11	27	7	42
37	Iowa	44.86	39	32	27
38	South Carolina	44.85	41	48	15
39	Virginia	43.51	22	34	38
40	Maryland	43.42	23	9	47
41	West Virginia	43.36	49	41	3
42	New York	42.25	37	6	49
43	Vermont	41.35	45	50	23
44	Delaware	40.66	40	14	44
45	Pennsylvania	40.18	47	22	37
46	Connecticut	39.31	48	4	48
47	Hawaii	38.05	30	49	41
48	New Hampshire	37.94	46	46	39
49	New Jersey	36.42	44	15	50
50	Rhode Island	35.29	50	24	36

Methodology

In order to determine the best and worst states to start a business, WalletHub compared the 50 states across three key dimensions: 1) Business Environment, 2) Access to Resources and 3) Business Costs.We evaluated those dimensions using 26 relevant metrics, which are listed below with their corresponding weights. Each metric was graded on a 100-point scale, with a score of 100 representing the most favorable conditions for new-business creation.Finally, we determined each state’s weighted average across all metrics to calculate its overall score and used the resulting scores to rank-order our sample.