AUSTIN, TX — The Austin-Round Rock region is among the nation’s best areas in which to launch a small business, according to a new report.
Small businesses play a vital role in the nation’s economy, comprising more than 99 percent of all firms, according to RewardExpert. Yet only about one-third of such enterprises survives a decade or longer. As a result, choosing where to start a business is of paramount importance.
Enter Austin-Round Rock. According to officials at RewardExpert –a free service that helps users take full advantage of credit card and travel rewards – the region is among the most promising for starting a business. In its newly released report titled 2018’s Best and Worst Places to Start a Small Business, researchers ranked the regions best suited for corporate startups by analyzing 177 metropolitan areas based on 30 data indicators, ranking Austin-Round Rock the 10th best spot for this endeavor.
The report determines which places across the country give small businesses and startups the best chance to survive and succeed, and which ones will present most challenges. Here’s what the report has to say about the Austin-Round Rock metropolitan area.
“The Austin metropolitan area has a lot going for it, including a population growth rate of 2.67 percent per year between 2010 and 2017, which is projected to continue unabated at a rate of 2.65 percent per year, making it one of the fastest growing metropolitan area in the country (second only to the retirement community of The Villages, Florida),” researchers wrote. “Another college town, Austin is home to an educated population (44.88 percent of area residents have at least some college education) to serve as a pool of prospective employees.”
Researchers found startup growth in the Austin areat to be in the 89th percentile, and the five-year survival rate for startups is likewise quite high, in the 92nd percentile. “Austin also benefits from Texas’ business-friendly lack of a corporate income tax,” analysts wrote.
The one drawback to Austin-Round Rock? Soaring office rents amid brisk development: “The only significant drawback to Austin is sky-high office space rental prices, which at an average $22.97 per square foot, are higher than the average for the New York metropolitan area,” according to the report.
RewardExpert CEO and co-founder Roman Shteyn stressed the need to understand a region’s dynamics in choosing place to launch one’s business: “Starting a small business is a daunting venture,” Shteyn said in a prepared statement. “I’ve been an entrepreneur for about two decades and have experienced many pitfalls and successes. Knowing the advantages and obstacles of the market in which you’re starting your business is imperative to your long-term success. This ranking informs entrepreneurs of which locations across the country are friendliest to small businesses.”
For those interested in how other regions fared, here’s how analysts encapsulated the best three places to start a small business.
- Denver-Aurora-Lakewood, Colorado – One of the fastest growing metropolitan areas, with its population projected to grow 1.65 percent per year, Denver is an attractive location for individuals and businesses alike. Colorado, moreover, has attracted substantial venture capital investment, with 128 deals worth a total of $670,000,000 made between 2010 and 2016.
- Boston-Cambridge-Newton, Massachusetts – The second-place Boston metropolitan region is an obvious choice for startups. The Boston metro area ranks in the 87th percentile for startup growth and number of startup companies (only 1.7 percent of all businesses are startups).
- Bridgeport-Stamford-Norwalk, Connecticut – Adjacent to the New York City metropolitan area, this coastal Connecticut strip is a smart choice for businesses that require space to grow. While home values are higher here than anywhere else, office space and housing remains inexpensive for those willing to live and/or work in the city of Bridgeport.
And the bottom three places for starting a small business are:
- Charleston-North Charleston, South Carolina – The Charleston, South Carolina, metropolitan area comes in as the number one least-favorable place to start a small business for a number of reasons. The area business ownership rate is below average, in the 8th percentile, with a very low percentage of startups (0.89 percent), and a below average five-year survival rate of 48.32 percent.
- Florida Panhandle Region (Tallahassee-Pensacola, Florida) – The Florida Panhandle region, including both the Tallahassee and Pensacola metropolitan regions, is the second least-favorable location for small businesses — and the absolute least favorable one for startups, which make up only 0.86 percent of all businesses. Population growth is sluggish, at a 0.875 percent annual growth rate. Furthermore, median household incomes and net worths are well below average, ranking in the bottom third nationally.
- Inland Empire and Bakersfield, California (Bakersfield-Riverside-San Bernardino-Ontario, California) – Outside of the Bay Area and the Los Angeles-San Diego corridor, California presents a rather inhospitable climate for small businesses and startups alike. Of the three regions that rank third through fifth least propitious, Bakersfield and the Inland Empire region takes the cake. Small business density is below average, and those startups that launch here fail more frequently than average, with a five-year survival rate of only 47.25 percent.
“While large corporations rule the stock market, small businesses and startups are the biggest drivers of our economy,” Shteyn said. “They create job opportunities across the country and provide local communities with economic growth and innovation. As citizens we should support local businesses in return.”
The cities and metropolitan areas in the report were evaluated on numerous data indicators divided into nine broad categories, including office space; demographics and diversity; education; income and assets; retail market; transit and commute; housing; taxes; venture capital; and the standing of startups and small businesses.”
For further information and to view the full report, visit the RewardExpert website.
About RewardExpert (provided text):
RewardExpert helps users navigate the world of frequent flyer programs and credit card rewards. The free web service provides smart tools and features that enable users to make more rewarding decisions. Through personal finance and travel insights, users are empowered to turn their spending into earning. Find out how to quickly gain rewards while spending less to see more of the world. To get started, visit www.rewardexpert.com.