For entrepreneurs, one of the most important questions that they ask themselves is ‘Where should I start my business?’
For the third consecutive year, Biz2Credit examined average annual revenue, credit score, age of business, cash flow, and local market conditions of regions throughout the country to find the best city to run a small business.
Based on a weighted average, San Jose, CA, “The Capital of Silicon Valley” ranked as the Best Small Business City in America this year.
The Silicon Valley is best known for its technology sector, but traditional goods and service companies are continuing to emerge in support of the thriving economic region. The overall growth in the region’s industries including construction, logistics, restaurants and hospitality, largely rely on their success from the booming tech sector. Additionally, business owners in the San Jose area had the highest average credit scores and top BizAnalyzer score, a comprehensive breakdown of financial information on Biz2Credit’s platform supplemented by data from Dun & Bradstreet (NYSE: DNB),the world’s leading source of commercial information and insight on businesses.
New York City didn’t finish far behind in the study. It ranked highest among small business owners nationwide in average annual revenue ($1,421,959). New York has always been a place that inspires innovations and diversity and this is driving the economy.
“We have a unique situation with our product and our price point which is quite affordable,” suggested Sarita Ekya, owner of S’Mac, a restaurant that has been in business for a decade in Manhattan’s East Village specializing in macaroni and cheese. “We opened in 2006 and in 2008 our business grew significantly and it has done so for a number of years. Right now we’re still in our growth phase.”
Philadelphia ranked as the fastest growing small business city because the average age of business is only three years (36 months). As a benchmark, the national average age of business is 50 months. The growth in Philadelphia may be due in part to the recent improvements to the Center City district, which has a positive influence on the city’s tourism, dining, arts, entertainment, health care, education, hospitality, and retail business industries.
The Top 10 Small Business Cities in America, according to Biz2Credit’s research are:
- San Jose, CA
- New York, NY
- Miami-Fort Lauderdale, FL
- Chicago, IL
- Tampa-St. Petersburg, FL
- San Diego, CA
- Los Angeles, CA
- Orlando, FL
- San Francisco-Oakland, CA
- Houston, TX
In conducting the research for this report, Biz2Credit analyzed more than 55,000 businesses, each with fewer than 250 employees. The firms analyzed were in operation for more than a year and had less than $10 million in annual revenues.
To see the complete ranking, visit Biz2Credit.
Rohit Arora is the CEO and co-founder of Biz2Credit.com, a leading online marketplace that connects entrepreneurs with small business loan options to meet their business financing needs. Rohit was named Crain’s NY Business “Entrepreneur of the Year 2011.” He holds a Masters in International Business from Columbia University.