Texas lands in top 10 most-expensive cities for running a new business

pay up

A new ranking puts Texas at No. 9 among the states with the highest expenses for starting and operating a business. Photo via Getty Images

Everything is bigger in Texas — or at least somewhat bigger — and that appears to include the cost of running a new business.

A new ranking from business consulting firm Venture Smarter puts Texas at No. 9 among the states with the highest expenses for starting and operating a business.

New York appears at No. 1 on the list, followed by Washington and Massachusetts.

The cheapest state? Mississippi. It was preceded in the ranking by Kentucky and North Dakota.

To come up with its list, Venture Smarter looked at eight metrics, including corporate tax rate, average LLC filing fees, average real estate costs, and minimum wage.

Texas scored 59.74 out of 100 for startup expenses, with a higher score being worse.

The Lone Star State tied with Tennessee for the highest initial LLC filing fees ($300). But unlike many other states, Texas doesn’t require business owners to pay LLC filing fees each year to keep a business incorporated.

Texas fared well on several counts, though, such as no corporate tax, a low state-mandated minimum wage ($7.25 an hour), and relatively low real estate costs.

“This research aims to provide valuable insights into the business climate across various states, offering new entrepreneurs the information they need to make well-informed decisions on their entrepreneurial journey,” Venture Smarter says in a statement. “By understanding the unique characteristics and challenges of each state, aspiring business owners can navigate the complexities of different markets and optimize their chances of success.”

When it comes to Texas being a top state for business, we guess the jury's out. Photo via Getty Images

Is Texas a top state for business? New reports find mixed results

by the numbers

Texas economic development boosters are crowing about a new top-in-the-nation ranking. But they’re probably frowning about a different business ranking that’s mediocre.

First, the good news.

Business Facilities magazine just named Texas the 2023 State of the Year in recognition of its business climate, economic development leadership, and “blockbuster” year for capital investment and job creation. It’s the fifth time that Business Facilities has crowned Texas as the top state.

“Texas moves at the speed of business,” Gov. Greg Abbott said in a news release. “As recognized by Business Facilities magazine, Texas leads the nation for corporate relocations, business expansions, and job creation.”

“With the best business climate in the nation, leading investments in education and workforce development, and our young, skilled, diverse, and growing workforce, Texas is poised to lead the nation in 2024,” the governor added.

Additionally, Texas again appears on WalletHub's annual list of "Best States to Start a Business" — but ranks lower than last year. The Lone Star State ranked No. 8 this year compared to last year's No. 3 spot. This ranking looked at business environment, access to resources, and business costs across 25 relevant metrics by analyzing data from U.S. Census Bureau, Bureau of Labor Statistics, and other resources.

Now, the not-so-good news.

Texas landed at No. 32 on Forbes Advisor’s new list of the best states to start a small business in 2024. The Lone Star State received especially low marks economy, workforce, and business climate, but fared better in two other categories: business costs and financial accessibility.

Topping the Forbes Advisor list was North Dakota, followed by Indiana, Arkansas, South Dakota, and North Carolina.

Texas recently was awarded three other No. 1 business climate rankings, though: Best Business Climate in the U.S. by Business Facilities in June, Best Business Climate in the U.S. by corporate executives in September, and Top Business Climate in the U.S. by Site Selection Magazine in November.

“In a state the size of Texas, business is not just finding a home in the metros. A laser focus by economic developers across the state to foster established businesses as well as innovative startups is paying off for communities of all sizes,” Anne Cosgrove, editorial director of Business Facilities, says in a news release.

The magazine covers corporate site selection and economic development.

Other contenders for 2023 State of the Year were:

  • Arizona
  • Florida
  • Georgia
  • Indiana
  • Missouri
  • Nevada
  • North Carolina
  • Tennessee
  • Utah
  • Virginia
Texas, once again, has been named a top city for starting a business. Photo via Getty Images

Texas ranks among best states to start a business

We're no. 3

For years, Texas has been lauded for its business climate being welcoming for new businesses and startups. This year's study shows that the Lone Star State has yet again made the list.

Texas ranked as the third best state to start a business in personal finance website WalletHub's recent list, 2023's Best & Worst States to Start a Business, with a score of 56.85 points. Texas ranked behind Utah, No. 1, and Florida, No. 2, and just ahead of Colorado. Idaho, Georgia, Arizona, Nevada, Oklahoma, and California make up the rest of the top 10, respectively.

The study looked at 27 key indicators of startup success across all 50 states. Texas was recognized for these factors in particular:

  • No. 10 – average growth in number of small businesses
  • No. 30 – labor costs
  • No. 10 – availability of human capital
  • No. 4 – average length of work week (in hours)
  • No. 14 – cost of living
  • No. 13 – industry variety
  • No. 31 – percentage of residents who are fully vaccinated against COVID-19
Source: WalletHub


Richard Ryffel, professor of finance practice at Washington University in St. Louis, noted the importance of policy in making a state a good place to start a business..

"Established businesses looking to expand might expand or relocate entirely based on the relative favorability of the local business climate," Ryffel says. "Recently, Texas, for example, has been the beneficiary of some significant business relocations based on its business-friendly policies."

The methodology of the study focused on three key dimensions — business environment, access to resources, and business costs — and 27 relevant metrics. Each metric was graded on a 100-point scale, and then each state’s average across all metrics was used to calculate its overall score.

In 2021, Texas ranked in the top position of WalletHub's study. Last year, the personal finance website looked at which cities were ideal spots for business launching. The report found that Georgetown as the best small city in Texas for starting a business.

Houston suburbs didn't manage to crack the top 200, but four were recognized amongst the rest of the best small business towns, according to the study:

  • Texas City , No. 202
  • Baytown, No. 267
  • Deer Park, No. 362
  • Conroe, No. 369
When it came to big cities, Houston ranked as No. 35.
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5 minority-founded Houston startups shine as Innovation Awards finalists

Meet the Finalists

Houston is one of the most diverse cities in the nation, and that trend carries over into its innovation and startup ecosystem.

As part of the 2025 Houston Innovation Awards, our Minority-founded Businesses category will honor an innovative Houston startup founded or co-founded by BIPOC or LGBTQ+ representation.

Five minority-founded businesses have been named finalists for the 2025 award. The finalists, selected by our esteemed panel of judges, range from a wearable health tech device company to a clean chemical manufacturing business to a startup with a lunar mission.

Read more about these innovative businesses, their initiatives, and their inspirational founders below. Then join us at the Houston Innovation Awards on Nov. 13 at Greentown Labs, when the winner will be unveiled at our live awards ceremony.

Tickets are on now for this exclusive event celebrating all things Houston Innovation.

Capwell Services

Houston-based methane capture company Capwell Services works to eliminate vented oil and gas emissions economically for operators. According to the company, methane emissions are vented from most oil and gas facilities due to safety protocols, and operators are not able to capture the gas cost-effectively, leading operators to emit more than 14 million metric tons of methane per year in the US and Canada, equivalent to more than 400 million metric tons of CO2e per year. Founded in 2022, Capwell specializes in low and intermittent flow vents for methane capture.

The company began as a University of Pennsylvania senior design project led by current CEO Andrew Lane. It has since participated in programs with Greentown Labs and Rice Clean Energy Accelerator. The company moved to Houston in 2023 and raised a pre-seed round. It has also received federal funding from the DOE. Capwell is currently piloting its commercial unit with oil and gas operators.

Deep Anchor Solutions

Offshore energy consulting and design company Deep Anchor Solutions aims to help expedite the adoption of floating offshore energy infrastructure with its deeply embedded ring anchor (DERA) technology. According to the company, its patented DERA system can be installed quietly without heavy-lift vessels, reducing anchor-related costs by up to 75 percent and lifecycle CO2 emissions by up to 80 percent.

The company was founded in 2023 by current CEO Junho Lee and CTO Charles Aubeny. Lee earned his Ph.D. in geotechnical engineering from Texas A&M University, where Aubeny is a professor of civil and environmental engineering. The company has not raised VC funding, but has participated in numerous accelerators and incubators, including Greentown Labs, MassChallenge, EnergyTechNexus LiftOff and others. Lee is an Activate 2025 fellow.

Mars Materials

Clean chemical manufacturing business Mars Materials is working to convert captured carbon into resources, such as carbon fiber and wastewater treatment chemicals. The company develops and produces its drop-in chemical products in Houston and uses an in-licensed process for the National Renewable Energy Lab to produce acrylonitrile, which is used to produce plastics, synthetic fibers and rubbers. The company reports that it plans to open its first commercial plant in the next 18 months.

Founded in 2019 by CEO Aaron Fitzgerald, CTO Kristian Gubsch and lead engineer Trey Sheridan, the company has raised just under $1 million in capital and is backed by Bill Gates’ Breakthrough Energy, Shell, Black & Veatch and other organizations.

Torres Orbital Mining (TOM)

Space tech company Torres Orbital Mining aims to pioneer the sustainable extraction and processing of lunar regolith and designs and builds robotic systems for excavating, classifying, and delivering lunar material. The company aims to accelerate a permanent and ethical human presence on the Moon.

The company was founded this year by Luis Torres, a current MBA candidate at Rice Business.

Wellysis USA Inc.

Wellysis USA Inc. works to detect heart rhythm disorders with its continuous ECG/EKG monitor with AI reporting. Its S-Patch cardiac monitor is designed for extended testing periods of up to 14 days on a single battery charge. The device weighs only 9 grams, is waterproof and designed to be comfortable to wear, and is considered to have a high detection rate for arrhythmias. It is ideally suited for patient-centric clinical trials to help physicians make diagnoses faster, cheaper and more conveniently.

It was established in Houston in 2023 and participated in the JLABS SFF Program the same year. It closed a $12 million series B last year. It was founded by CEO Young Juhn, CTO Rick Kim, CFO JungSoo Kim and chief strategy officer JoongWoo Kim.

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The Houston Innovation Awards program is sponsored by Houston Community College, Houston Powder Coaters, FLIGHT by Yuengling, and more to be announced soon. For sponsorship opportunities, please contact sales@innovationmap.com.

The Ion taps John Reale for startup and investor role

new hire

The Ion has named John "JR" Reale as its director for startups and investor engagement.

In his new role, Reale, a longtime leader in Houston’s startup ecosystem, will work to strengthen the innovation district's founder and investor network.

"Here’s what I’ve come to believe: the Ion is not just a building, not just a real estate play, and not just another innovation district. COVID, remote work, and shifting market dynamics changed the rules. Key ingredients like co-working, events, and community, while impactful, are no longer enough on their own," Reale shared on a LinkedIn post announcing the move. "What’s needed are advantages ... We need to intentionally design a system that repeatedly delivers advantages so founders can pull forward their visions."

Reale previously served as executive in residence and venture partner at TMC Venture Fund and co-founded Station Houston. He also serves as managing director of Integr8d Capital. He's an investor and serves on the board of directors for a number of venture-backed companies, including Cart.com, Lionguard and others.

The Ion will host "Today Is Day One – A conversation with John (JR) Reale" to welcome Reale to the role on Tuesday, Oct. 21. Reale will be joined at the event by Heath Butler, partner at Mercury, to discuss their thoughts on shaping Houston's founders ecosystem, as well as the Ion’s Founder Advantage Platform.

"On top of this connected architecture, we will build product. That product will be the Founder Advantage Platform to remove friction, compress time, and compound outcomes," Reale continued on LinkedIn. "This is the system that will drive repeatable experiences, and naturally, make these journeys so much more fun."

Houston's IAH soars in new ranking of U.S. airports with best dining

Flying High

Here's news that'll make a flight delay at Houston's George Bush Intercontinental Airport a bit more palatable: IAH arrives at No. 12 in a new ranking of the country’s best airports for food and beverage options.

The 2025 study by commercial furniture manufacturer Restaurant Furniture relied on Google reviews of food and beverage establishments at the busiest U.S. airports to come up with its list. The study included only those restaurants and bars with at least 20 Google reviews.

IAH earned an average Google review rating of 3.29 out of 5 stars for its food-and-beverage establishments.

The study analyzed 61 restaurants and bars at George Bush Intercontinental Airport. The Houston airport’s highest rated establishment was Pappadeaux Seafood Kitchen. That Pappadeux location garnered an average Google review rating of 4.48 out of 5. George Bush International also is home to the study’s highest-rated Chick-fil-A and Whataburger restaurants.

Several years ago, IAH made a major effort to upgrade its dining options by partnering with local chefs such as Chris Shepherd, Ryan Pera (Coltivare), and Greg Gatlin (Gatlin's BBQ) on concepts for Terminal C North. More recently, a change in the city's airport concessions contract brought local favorites such as The Annie Cafe and Common Bond to the George Bush.

“Airports aren’t usually renowned for their choices of bars and restaurants, and this is often because people just want to get through the airport and onto their final destinations as quickly as possible,” Nick Warren, head of e-commerce at Restaurant Furniture, says in a release. “However, a good airport bar or restaurant can provide a great rest stop after a long flight, and these positive experiences can go a long way towards travelers choosing which airport they will fly from in the future.”

Dallas Fort Worth International Airport soared to No. 1 in the rankings. Restaurants and bars at DFW earned an average of 3.56 out of 5 stars on Google — the highest number among 31 airports.

Just like in Houston, among 74 locations at DFW, the study found Pappadeaux Seafood Kitchen in Terminal A scored the highest average Google review rating — 4.59. DFW also boasts the top-rated IHOP, McDonald’s, Panera Bread, and Panda Express among the 31 airports that were analyzed.

Rounding out the top five airports with best food are Miami International Airport (No. 2), San Francisco International Airport (No. 3), Denver International Airport (No. 4), and Hartsfield-Jackson Atlanta International Airport (No. 5).

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A version of this story originally appeared on CultureMap.com.

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