UNDATED – With around 1 in 5 new businesses failing within the first year and inflation making things even more difficult, the personal-finance website WalletHub today released its report on the Best & Worst States to Start a Business in 2025, as well as expert commentary, to help people maximize their chances of success by starting in the right location.
WalletHub compared the 50 U.S. states across 25 key indicators of startup success. The data set ranges from financing accessibility to labor costs to office-space affordability.
South Dakota was 28th in the Study. It fared well for its business cost, where it was 3rd, but rated 47th for its access to resources.
| Best States to Start a Business | Worst States to Start a Business | |
| 1. Florida | 41. West Virginia | |
| 2. Georgia | 42. Vermont | |
| 3. Utah | 43. Pennsylvania | |
| 4. Texas | 44. Hawaii | |
| 5. Idaho | 45. New Hampshire | |
| 6. Oklahoma | 46. Maryland | |
| 7. Nevada | 47. Alaska | |
| 8. Colorado | 48. New Jersey | |
| 9. Arizona | 49. Connecticut | |
| 10. Kentucky | 50. Rhode Island |
Best vs. Worst
- Iowa has the cheapest average annual rent for office space – 2.2 times cheaper than in New York, where it is most expensive.
- Mississippi has the lowest labor costs (median annual income) – 1.9 times lower than in Maryland, which has the highest.
- Massachusetts has the highest share of the population with a college education two times higher than in West Virginia, which has the lowest.
- Wyoming has the most startups per 100,000 residents – 3.7 times more than in West Virginia, which has the fewest.
To view the full report and your state’s rank, please visit:
https://wallethub.com/edu/best-states-to-start-a-business/36934
