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Weekly Wisdom from Kauffman: The 'friendliest' places to start your company

on April 18, 2013

The Silicon Valley might not be the “friendliest” place to start your life science or digital health company. A small business survey released this month by the Kauffman Foundation and gave Austin, Virginia Beach, and Houston top honors as the friendliest cities for small businesses.

The top five states for small business friendliness were Utah, Alabama, New Hampshire, Idaho, and Texas. The bottom five: Hawaii, Maine, Rhode Island, California, and Illinois.

The Small Business Friendliness Survey garners data from a network of job creators and entrepreneurs to determine its friendliness rankings. More than 7,700 small businesses across the country were surveyed.

Key findings from the survey include:

  • Texas had three of the top five cities (Austin, Houston, and San Antonio), while California was home to three of the bottom five (Los Angeles, San Diego, and Sacramento). Newark, N.J., finished last in this year's rankings.
  • Professional licensing requirements were 30 percent more important than taxes in determining a state's overall business-friendliness, confirming the findings from last year's study. Furthermore, this year's research revealed that 40 percent of U.S. small businesses are subject to licensing regulations by multiple jurisdictions or levels of government.
  • African-American and Hispanic small business owners were significantly more likely than their white counterparts to encourage others to start a new business.
  • North Carolina was the most improved state, making strides across multiple categories and rising from a "C+" to a "B+" grade overall.

Weekly Wisdom from Kauffman is a regular feature on eMed highlighting insightful research from the Kauffman Foundation. Do you have a favorite Kauffman research insight that could help life science entrepreneurs? Send it to

Category:  Execution  Tags:  wisdom, entrepreneurs, friendliest places

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