Starting a Small Business? Here Are the States Where It's Most Likely to Survive — and the Least.location can make or break your business's success.
ByAmanda Breen•
Key Takeaways
- Approximately 20% of new businesses fail within the first two years of being open.
- Your business location will impact your taxes, zoning laws and the regulations you'll have to follow.
There are many important things to consider when you giveentrepreneurshipa try andlaunch your own business— and location is at the top of the list.
Thelocationof your business will impact everything from taxes to zoning laws, so it pays to be strategic about your choice of state, city, and even neighborhood, according to theU.S. Small Business Administration.
Choosing the right place to start your business can also make or break itssuccess.
Related:5 Things Not to Do When You're Running a Small Business
Approximately 20% of new businesses fail within the first two years of being open, 45% within the first five years and 65% within the first 10 years, perU.S. Bureau of Labor Statistics(BLS) data.
Capital on Tap, a company that offers a credit card and spend-management platform for small business owners, analyzed BLS data to determine the percentage of startups that are still active after three years — and broke down the U.S. states with the highest and lowest chance of survival in a three-year and five-year time frame.
"There are over 30 million small businesses in the U.S., making up an enormous percentage of the economy, and as this number continues to grow, so will innovation and commercial drive. This research should serve as a positive sign to entrepreneurs in the top ten states who are thinking about starting a business," Damian Brychcy, Chief Legal, America and Product Officer at Capital on Tap, said.
Image Credit: John Coletti | Getty Images. Boston, Massachusetts.
U.S. states with the highest rate of small business survival per Capital on Tap |
|||
State |
1year average (%) |
3year average (%) |
5year average (%) |
麻萨诸塞州 |
81.91 |
64.96 |
54.38 |
Wisconsin |
81.13 |
64.93 |
54.97 |
South Dakota |
80.44 |
64.03 |
54.88 |
Minnesota |
80.96 |
63.97 |
53.51 |
Iowa |
80.85 |
63.71 |
53.65 |
North Dakota |
79.55 |
63.63 |
53.98 |
Pennsylvania |
80.69 |
63.51 |
53.18 |
Montana |
79.60 |
62.79 |
53.03 |
Hawaii |
79.37 |
62.22 |
52.21 |
North Carolina |
79.85 |
61.91 |
51.25 |
U.S. states with the lowest rate of small business survival. |
|||
State |
1year average (%) |
3year average (%) |
5year average (%) |
Washington |
75.12 |
54.60 |
42.75 |
District of Columbia |
76.04 |
54.73 |
43.73 |
New Mexico |
76.64 |
56.58 |
45.58 |
Florida |
77.00 |
56.82 |
44.95 |
Nevada |
77.18 |
57.38 |
46.79 |
New Hampshire |
76.65 |
57.52 |
46.63 |
Arizona |
77.34 |
58.00 |
46.74 |
Tennessee |
78.46 |
58.21 |
46.81 |
Arkansas |
77.64 |
58.24 |
47.25 |
Rhode Island |
76.76 |
58.30 |
47.75 |