The 10 US states where women have the best chances of growing a business and getting the funding they need, ranked
Location can have a major impact on business success — and this is especially true for female entrepreneurs. Every state in the US has different laws, industries, and initiatives that can either aid or hinder business success. Fit Small Business ranked all 50 states based on opportunities and benefits for women business owners. Colorado was the top state, while California, New York, and Texas also ranked among the top five. Visit Business Insider's homepage for more stories.
Location, location, location! Although the age-old dictum came from selling real estate, the same goes for starting a business. Your location can make all the difference in getting funding, acquiring customers, and scaling up. Since every state has different laws, industries, and initiatives, it's key to consider how your location may hinder or drive your success. This is even more important for businesses owned by women, which are steadily growing. However, women face more obstacles in getting funding, and their businesses make less money on average than those owned by men. According to a recent study by American Express, revenue disparity has worsened. For every dollar that a private company generated, women-owned businesses generated 37 cents in 1997 and 30 cents in 2019. Fit Small Business, a website that writes advice for small businesses, released an annual study of the best states in America for female entrepreneurs. The site ranked all 50 states based on several factors that can make it easier for women business owners to succeed, including cost of living, access to funding, women's health, and startup survival rates. Here are the top 10 states for female entrepreneurs to start and grow their businesses.10. Vermont
With a population of 626,299, Vermont is the smallest state on this list, yet still has opportunity for women business owners and venture capital. In 2018, female founders received $130 million in capital, according to a report from Pitch Book. The state ranks high in women's issues and social justice, though it also has a high cost of living and a corporate tax rate to consider. 9. Iowa
Fit Small Business calls Iowa an "all around balanced state for female entrepreneurs," with strong opportunities for women-owned businesses in biotechnology and green energy. However, it ranked the state low in terms of social justice and women's rights. 8. Georgia
Between 2014 and 2019, Georgia was the top state for growth of women-owned businesses in number of companies, revenue, and employment, according to a report by American Express. Fit Small Business ranked the state at a low 41 in women's health and safety initiatives. However, when it comes to business development, there are several initiatives that provide support. This includes the Greater Women's Business Council, which offers training, events, and certification help to women-owned businesses in Georgia. 7. Massachusetts
Massachusetts has been historically progressive in women's issues and business development, but when it comes to cost efficiency, it falls behind compared to other states. Massachusetts is known for high taxes and cost of living. According to a report by Kauffman, the state had only an average startup growth rate compared to other states, with 0.23% of the population starting new businesses in 2018.
Florida's fairly low cost of living is just one aspect that makes it desirable for business owners. But if you want to be at the center of it all in Miami, it's going to cost significantly more, as real estate prices are some of the highest in the country. The state is still developing its standing in women's and minority initiatives and business development. The Florida Women's Business Center provides training, mentoring, and programs to women business owners. 5. Texas
Business Insider ranked Texas as the best state to start a small business in 2020, with one of the highest net gains in small businesses. Cities like Austin and Houston are emerging as major hubs for startups and local businesses. The city already plays host to a number of Silicon Valley exports, including Facebook, Google, and Apple. In July, Tesla announced that it had chosen Austin as the site of its second US factory, a 5 million-square-foot plant for the company's Cybertruck, Semi truck, and Model 3 and Y vehicles. The state is especially strong for women and minority-owned companies, and has initiatives such as the Texas Women's Foundation that last year invested $6.3 million in research, advocacy, and programs to help advance women in leadership and financial equality. 4. New York
Although New York has one of the highest costs of living in the country, it has a lot of resources for small businesses and initiatives for female business owners. The New York City Economic Development Corporation hosts events and free workshops through Women.nyc, and the New York City Department of Small Business Services offers startup funding through WeFund. New York City is also home to many coworking spaces for women, such as The Wing and Luminary, which aim to help female business owners and freelancers work remotely, network, and balance other areas of life like childcare and wellness. 3. Washington
Last year, Business Insider's Ivan De Luce reported Seattle as the best city to launch a startup, because of the city government's strong support of small businesses, such as offering seed funding and consulting through the Only in Seattle initiative. Washington has a lot of resources for women entrepreneurs, such as the Women's Funding Alliance, 100% Talent, Women's Funding Network and the WA Women's Foundation. The state also has no personal or corporate income tax, though it does charge a business and occupation (B&O) tax. 2. California
California comes in second place in part for the amount of startups and venture capital in Silicon Valley and the San Francisco Bay area. But that doesn't discredit the rest of the state. Other top cities for business owners include Yorba Linda, Los Angeles, and Torrance. The state's cost of living is tremendous, second only to Hawaii, and taxes are high. But the trade off is the extensive funding available. Californian female founders received $27.2 billion in total venture capital in 2018, more than any other state, according to a report by Pitch Book. 1. Colorado
Colorado tops the list for its economic advantages, like a competitive corporate tax rate and low cost of living, balanced with an overall female-friendly environment. According to an analysis by Kauffman Indicators of Entrepreneurship, 81.12% of Colorado startups in 2018 were still active after one year. The state offers robust resources and communities for women and minority business owners. Initiatives like The Women's Foundation of Colorado and The Women's Collaborative for Colorado advocate for equality, benefits, and creating more economic opportunities for women. The state's Minority Business Office offers free consulting, helps small businesses land certifications and government contracts, and hosts the Governor's Minority Business Awards.
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