Startup city

Houston named a top city to start a business

Startups fair well in Houston, a new study finds. Photo by Zview/Getty Images

Ten percent of the United States workforce — 15.3 million people — work for themselves, according to the Bureau of Labor Statistics. In honor of National Small Business Week, a recent study sought out the best cities for starting a business, and Houston came in at No. 13.

WalletHub, a personal financial website, used 19 key metrics — such as five-year business-survival rate and office-space affordability — to compare 100 cities in the U.S.

Houston ranked highest in the business environment category with a No. 4 ranking. This ranking considered startups per capita, average growth of business revenue, length of an average work week, etc.

The other two rankings were access to resources and business costs. For those, Houston ranked No. 55 and No. 67, respectively.

The population of Houstonians starting new companies is growing every year. According to the Greater Houston Partnership's data, the greater Houston area added 11,700 firms between 2013 to 2018 — an average addition of 2,340 per year.

Aside from the unclassified new businesses starting up in Houston, the most popular industries for new companies are restaurants, individual and family services, and computer systems design and related services, per the GHP. Within computer systems alone, the region added almost 700 new companies over the past five years.

In a city named the most diverse in the country, about one-third (31.6 percent) of all Houston firms are minority-owned, according to the GHP. Asians own 17.6 per­cent, Hispanics 10.1 percent, Blacks 3.5 percent, and Native Americans, Hawaiians and other groups 0.4 percent. Houston was recently ranked as a top city for minority entrepreneurial success.

Meanwhile, one in five firms (20.5 percent) is female-owned — one in seven (13.8 percent) is equally male/female-owned. While the data varies slightly, another recent study found that Houston had the 7th most startups with female owners.

Perhaps most telling for the WalletHub's findings is that the GHP reports that nearly two-thirds (63.6 percent) of all Houston em­ployers have been in business six years or more.

Texas, which was recently named the top state for female entrepreneurs, fared well overall in the WalletHub study, with seven cities in the top 20. Here's how the rest of the state ranked:

  • Austin came in at No. 4
  • Fort Worth took the No. 11 spot
  • Dallas secured the No. 15 rank
  • San Antonio ranked at No. 16
  • Irving came in at No. 17
  • Laredo was named No. 18
  • Lubbock missed the top 20, but took the No. 23 spot

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Building Houston

 
 

The $2.23 million deal means a growing presence Texas for Octopus Energy. Photo via octopusenergy.com

A renewable energy retailer based in the United Kingdom is once again expanding its presence in Texas with another strategic acquisition.

Octopus Energy US, which is based in Houston, announced that it has signed an agreement to acquire Houston-based energy provider Brilliant Energy LLC in a $2.23 million deal. With the acquisition, Octopus Energy will take on the 9,000 residential customers currently supplied by Brilliant Energy. These users will be transitioned onto Octopus Energy's technology platform Kraken.

"Brilliant Energy is a company that has always stood for quality and unique brand experiences. It complements our strong dedication to bringing unparalleled customer experience to our users," says Michael Lee, CEO of Octopus Energy US, in a press release. "This is a major moment for us, as we work to bring our 100% renewable energy supply and outstanding technology to more Texans and their homes."

The acquisition is the latest move from Octopus Energy's plans to invest $100 million into the U.S. energy market and target 25 million U.S. energy accounts by 2027, according to the release.

Last fall, Octopus acquired Houston-based Evolve Energy in a $5 million deal. Evolve was founded by Lee, and he transitioned into his role as Octopus CEO following the deal.

Octopus Energy, which was founded around five years ago, reached Unicorn status with a $1 billion valuation in April 2020.

Michael Lee is CEO of Octopus Energy US. Photo via LinkedIn

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