Startup capitals of America blog post

Texas has been a hub for business activity in America for many years. Since the 1990s, Austin has been nicknamed “Silicon Hills” for its bustling tech sector, and Dallas has a strong stake in healthcare, education, and finance markets. 

The state is the 4^th highest in our rankings for venture capital investments, with $6.66bn being funneled in annually, and has the 3^rd most entrepreneurs of any state in America at just over 40,000. This makes it the second-best state nationally for business viability, only being beaten by California. 

Most impressively though, it’s the number one destination in the country for coworking spaces, with 280 available. This contributes to its status as the #1 state in America for business support quality according to our rankings. 

All these, plus other high scores across the board, give Texas a total rating of 55.31 on our list. It’s a close race at the top, but it takes the lead as the best startup location in America. Plus, with 53% of its businesses surviving beyond the 5-year milestone, it beats the national average for continued success.

Just behind Texas in our rankings is Ohio, which scores 54.93 on our index. Its crowning achievement is the cheapest office rent per square foot in America, at $14.82 on average. Additionally, it places in the top 10 states for coworking spaces with 197, offering plenty of options when it comes to establishing a home-base for your business. 

Ohio also boasts the joint 4^th highest business survival rate past 5 years in the US (55%), and with an estimated 11,950 entrepreneurs in the state already, it has a proven track record for startup success. 

Major industries in the state include manufacturing and automotives, but with retail hubs such as Columbus – which has been used as a testing ground for businesses in the past – there are a number of opportunities for successful small businesses

While Mississippi scored highly across multiple criteria, its main advantage is very clear. Across all 50 states, Mississippi has the cheapest operational costs on average. Not only does it have the lowest average hourly wage ($27.03), it’s also the cheapest state on our list for health insurance, with employers contributing just $5.61k per employee annually on average. 

It’s also the second cheapest state on our cost-of-living index (only beaten by Oklahoma), and tied for 6^th place in low unemployment rates across America (2.9%), giving it a strong workforce to find new employees from. Despite low scores in categories such as coworking spaces and venture capital investments, it earns a total score of 53.75 and claims 4^th place on our list.

Less than 0.1 points behind Mississippi is Florida, which earns 53.67 and a top 5 finish on our rankings. It’s the state with the most entrepreneurs in the USA by our findings, with more than 50,000 across the state. 

In addition to its entrepreneurial spirit, Florida has the money to back it up. With $2.69bn in venture capital investments annually, it’s the 7^th most attractive state to investors in America. It also comes incredibly close to equaling Texas’ score for the most coworking spaces, being pushed into second by just one point. 

Florida’s economy is the fourth largest in America by gross state product, pulling in more than $1 trillion every year as of 2024. Agriculture and tourism rank as two of its biggest sectors, with Miami serving as an economic center. Its business survival rate is below average at 50.1% over 5 years, but its other high rankings make it an attractive home for new small businesses.

Although Wisconsin doesn’t often attract huge venture capital investments or big crowds of entrepreneurs, it ranks as one of our top 10 states for its economic environment. With the joint 6^th lowest rate of unemployment in the country, below average cost-of-living, the 5^th lowest rate of sales tax in the United States, and roughly $13,930 in income tax free allowance, it’s a state with a strong local economy. 

Additionally, Wisconsin has the second lowest rent for office space by state, with a square foot of office space setting you back just $15.19 per year on average. Finishing with a score of 52.05 on our index, it earns a place in our top 10 startup capitals in America.

A state with multiple major financial hub cities, Pennsylvania earns a score of 51.76 and claims seventh place in our rankings. 

It’s the 5^th best state in our rankings for business viability. With more than $2bn in venture capital investments per year, and the joint 3^rd highest rate of business survivability across 5 years – at 56% – startups in Pennsylvania have plenty of potential for long-term success. Other strong areas include a below-average cost-of-living, 179 co-working spaces, and more than 12,000 entrepreneurs already established in the state. Its economy is the 6^th largest in America by GDP, with a thriving technology industry.

The least populated state in our top 10, Montana takes the #8 spot with a total mark of 51.29. 

With no sales tax, and $14,600 income tax free allowance, it ranks as our second best state for economic environment. Although such a sparsely populated state doesn’t bring much interest from venture capital opportunities, 53.9% of businesses are expected to last past their first 5 years. It also has the join 9^th lowest unemployment rate in America, at 3.3%.

With Atlanta serving as one of the South’s biggest economical hubs, Georgia manages to earn a spot in our top 10 American startup capitals. Every year, an estimated $1.6bn of venture capital is invested into its economy, and with 19,333 entrepreneurs in the state, there are plenty of startup opportunities from likeminded businesspeople. 

Its other biggest advantages include health insurance costs below the national average, and 215 co-working spaces across the state. It scores a total of 51.27 in our rankings, placing it in close contention with Montana, but solidifying a top 10 position.

Rounding out the top 10 is Tennessee, which earns high marks for its low prices. Behind Mississippi, it’s the second-lowest state in America for operational costs, with office rent prices of just $16.53/sq ft per year on average. 

Its other price advantages include an hourly wage of $30.07 on average (7^th lowest in America), and the 6^th lowest health insurance costs in the country at an average of $5,833. 

Totaling 50.79 points on our overall score, it beats states like Iowa, Michigan, and North Dakota to earn its status as our final American startup capital. 

While it’s true that you can start a successful business anywhere, choosing the right location can be a difficult task. Your aim should be a market with a stable economy and appropriate business support, without oversaturation from competitors. Many larger states famous for their business sectors are too expensive for budding entrepreneurs to afford, so be mindful of your circumstances when planning your new startup. 

Swoop Funding CEO Andrea Reynolds says “The key to a small business is to outline your goals and be prepared. Once you’ve taken your first steps towards starting your business, an effective plan for your future and the ability to adapt are the differences between a small business that lasts and one that fails shortly into its life. 

A business grant can be exactly what’s needed to give your startup the platform it needs to grow. There are numerous options to choose from, so research wisely and find the loan that suits your project best.”