Startup friendly

Texas named the No. 1 state to start a business

The Lone Star State stands out for being the best to start a business. Photo by gguy44/Getty Images

The entrepreneurial spirit is best cultivated by Texans, apparently. The Lone Star State comes in first place for being business-friendly to startups and their founders in a recent study.

Out of all 50 states, Texas reigns supreme in WalletHub's report of the best and worst states to start a business. Texas earns a score of 61.05, which factored in business environment, access to resources, and business costs. Of those factors, the state ranked No. 1 for business environment, No. 11 for access to resources, and No. 30 for business costs.

Zeroing in on some key factors, Texas was recognized for having the fourth highest average growth in small businesses and the fifth highest total spending on incentives as its percent of gross domestic product. Texas also has the fourth longest work week by hours.

Texas edged out No. 2 Utah by a mere 0.1 points. The rest of the top five includes Georgia, North Dakota, and Oklahoma, respectively. At the bottom of the rankings are Connecticut, Hawaii, New Hampshire, New Jersey, and Rhode Island.

"In looking at the main criteria WalletHub used to determine their best startup state ranking — namely business environment, access to resources and business costs — it's clear why Texas would come in at No. 1," Susan Davenport, senior vice president of economic development for the Greater Houston Partnership, tells InnovationMap. "These are all areas where the Lone Star State consistently excels and why Texas continues to attract both entrepreneurs and existing companies across industry sectors."

Houston recently received a similar distinction from the personal finance site. In May, WalletHub used 19 key metrics — such as five-year business-survival rate and office-space affordability — to name Houston the No. 13 best city for starting a business out of 100 of the largest U.S. metros. In that study, a total of seven Texas cities made the top 20.

"Here in Houston, we're seeing growth in tech-related startups in particular and an increasing momentum of activity to support growth stage companies including the development of The Ion and the TMC3 commercialization campus, and the opening of The Cannon start-up hub, among several others," Davenport adds.

Texas also has a favorable business climate for female entrepreneurs in particular, one study found. Texas moved up to No. 1 from No. 8 in 2018 in this report by Fit Small Business that published in January.

Meanwhile, while known for being best for business, Texas is far from the top ranking in a study that analyzed the states' overall capacity. Texas came in at No. 38 in U.S. News & World Report's best states rankings for 2019, but even this report recognized Texas' business climate.

"Texas' diverse industrial base has drawn many businesses and workers in recent decades because of light regulation, low taxes and a low cost of labor," U.S. News says. "Entrepreneurs are particularly attracted to Austin, which emerged as a major player in the technology industry in the 1990s. Its 'South by Southwest' is one of the preeminent national tech conferences."

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This article was updated to include the comment from GHP.

The report dug into Houston colleges' affordability, social environment, and academic and economic opportunities. Courtesy of Rice University

As high school seniors decide where to attend college, they examine degree programs and campus amenities, calculate job prospects, assess school spirit, and consider location. To help make the decision a bit easier, personal finance website WalletHub crunched the numbers on more than 400 cities across the U.S. to determine 2020's Best & Worst College Towns & Cities in America — and Houston appears near the top of the class.

The report, released on December 9, examined 415 cities across the U.S. and broke them down into three categories: large city (more than 300,000 people), midsize city (125,000 to 300,000 people), and small city (less than 125,000).

To determine the best and worst college cities, WalletHub used 31 metrics, each assigned a different weight, in three key areas: academic and economic opportunities (50 points), wallet friendliness (25 points), and social environment (25 points).

Houston, with a score of 56.89 ranked No. 18 among big cities and No. 30 among all cities. Houston's highest marks came in social environment, where it earned No. 27. Houston ranked 72nd in wallet friendliness and a surprisingly low 254th in academic and economic opportunities.

The title of best college city in Texas — and the U.S. — goes to Austin. The Capital City not only took the top spot among large cities, it also ranked first on the overall list.

With a score of 66.49, Austin's best grade, unsurprisingly, came in social environment, where it ranked No. 2. (With its beaches and perfect weather, only San Diego fared better.) Austin scored a rather middling 196 in wallet friendliness, but it ranked a solid 54th in academic and economic opportunities.

Elsewhere in Texas, Dallas ranked No. 23 among big cities and No. 55 on the overall list. Big D had a total score of 54.89. Its highest grade came in social environment (46), followed by academic and economic opportunities (186) and wallet friendliness (236).

Neighboring Fort Worth earned the 86th spot overall, 36th among big cities. Fort Worth earned an overall score of 53.4 and clenched the 125th spot in social environment, 126th in academic and economic opportunities, and 256th in wallet friendliness.

San Antonio earned a score of 54.37, securing the 65th spot overall and the 29th spot among big cities. It earned high scores in social environment (24) and wallet friendliness (83) but fell hard in the academic and economic opportunities category (343).

Joining Austin on the combined list are Orlando (No. 2); Scottsdale, Arizona (No. 3); Tampa (No. 4); Ann Arbor, Michigan (No. 5); Seattle (No. 6); San Diego (No. 7); Las Vegas (No.8); Salt Lake City (No. 9); and Provo, Utah (No. 10).

So where is the worst college town? That unpleasant distinction goes to Germantown, Maryland. The Washington, D.C. suburb is joined by Kendall, Florida (No. 414); Shreveport, Louisiana (No. 413); Bridgeport, Connecticut (No. 412); and New Rochelle, New York (No. 411).

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This article originally ran on CultureMap.