Is starting a company in your plan in 2025? If you do not need to start one of the roughly 20% of firms that fail inside two years, you must consider all the aspects that make or break your business.
And exactly Where you are starting a business is one of the most significant pieces of the puzzle.
Entrepreneurs who strategically select the state, city or district of their business can profit from various taxes, zoning regulations and licensing requirements, according to US Bureau of Labor Statistics (BLS).
New study from Hub Wallet compared all 50 states on 25 key indicators of startup success – aspects corresponding to labor costs, the availability of human capital and the variety of hours in an average workweek – to discover where entrepreneurs stand to gain the most.
“It’s crucial to start your business in a state that maximizes your chances of success,” says WalletHub analyst Chip Lupo. “The best states have low corporate tax rates, a strong economy, plenty of reliable workers, easy access to financing and affordable real estate.”
Below you will find WalletHub’s full rating of the best and worst states to start a business in 2025:
|
Overall rating |
Country |
Total rating |
Business Environment Ranking |
Access to resource rating |
Business cost rating |
|
1 |
Florida |
59.66 |
1 |
14 |
28 |
|
2 |
Georgia |
58.62 |
2 |
27 |
16 |
|
3 |
Utah |
57.84 |
11 |
2 |
29 |
|
4 |
Texas |
56.28 |
3 |
12 |
34 |
|
5 |
Idaho |
56/02 |
8 |
16 |
11 |
|
6 |
Oklahoma |
55.17 |
16 |
28 |
2 |
|
7 |
Nevada |
54/03 |
13 |
11 |
21 |
|
8 |
Colorado |
53.98 |
5 |
10 |
31 |
|
9 |
Arizona |
53.46 |
4 |
36 |
30 |
|
10 |
Kentucky |
53.36 |
20 |
22 |
4 |
|
11 |
Arkansas |
53.29 |
15 |
26 |
6 |
|
12 |
Tennessee |
53.23 |
6 |
30 |
27 |
|
13 |
South Carolina |
53.15 |
10 |
35 |
10 |
|
14 |
Mississippi |
52.59 |
26 |
37 |
1 |
|
15 |
North Carolina |
52.32 |
9 |
32 |
20 |
|
16 |
Montana |
52/08 |
12 |
41 |
8 |
|
17 |
Alabama |
52/07 |
18 |
39 |
5 |
|
18 |
California |
51.42 |
7 |
1 |
49 |
|
19 |
Indiana |
50.22 |
30 |
21 |
7 |
|
20 |
Louisiana |
48.76 |
25 |
31 |
17 |
|
21 |
Illinois |
48.17 |
39 |
3 |
35 |
|
22 |
Michigan |
48/10 |
33 |
18 |
18 |
|
23 |
Maine |
48/04 |
14 |
44 |
25 |
|
24 |
Nebraska |
47.70 |
32 |
19 |
24 |
|
25 |
Washington |
47.59 |
22 |
6 |
41 |
|
26 |
Ohio |
47.47 |
36 |
23 |
15 |
|
27 |
New Mexico |
47.36 |
34 |
38 |
9 |
|
28 |
South Dakota |
47/13 |
37 |
47 |
3 |
|
29 |
Minnesota |
46.88 |
35 |
9 |
32 |
|
30 |
Kansas |
46.73 |
41 |
25 |
12 |
|
31 |
Wyoming |
46.60 |
21 |
46 |
23 |
|
32 |
North Dakota |
45.74 |
23 |
43 |
22 |
|
33 |
Massachusetts |
45.55 |
29 |
4 |
44 |
|
34 |
Missouri |
45.17 |
46 |
20 |
19 |
|
35 |
Wisconsin |
45/01 |
47 |
15 |
26 |
|
36 |
Iowa |
44.98 |
45 |
29 |
14 |
|
37 |
Delaware |
44.78 |
27 |
7 |
43 |
|
38 |
Virginia |
43/05 |
24 |
34 |
37 |
|
39 |
Oregon |
41.52 |
31 |
24 |
39 |
|
40 |
New York |
41.25 |
40 |
5 |
48 |
|
41 |
West Virginia |
40.43 |
48 |
50 |
13 |
|
42 |
Vermont |
39.91 |
42 |
42 |
33 |
|
43 |
Pennsylvania |
39.29 |
44 |
33 |
38 |
|
44 |
Hawaii |
39.20 |
19 |
49 |
42 |
|
45 |
New Hampshire |
39/02 |
38 |
45 |
36 |
|
46 |
Maryland |
38.93 |
28 |
17 |
47 |
|
47 |
Alaska |
38.37 |
17 |
48 |
45 |
|
48 |
New Jersey |
37.36 |
43 |
8 |
50 |
|
49 |
Connecticut |
34.63 |
49 |
13 |
46 |
|
50 |
Rhode Island |
33.51 |
50 |
40 |
40 |
Note: With the exception of “Total Score”, all columns in the table above show the relative rank of that condition, with rank 1 being the best condition for that metric category.