Want to Start a Business in 2025? Here’s Where You Should (and Shouldn’t) Go

Okay, let’s cut to the chase. You’re thinking about starting a business, right? That’s awesome, but here’s the harsh truth: where you launch can make or break you. Forget the hype and the motivational speeches; we’re talking about cold, hard data. WalletHub crunched the numbers, and the results are in. Let’s dive into the best and worst states to start a business in 2025. I’m going to give you the insights you need to make the smart move, not just a lucky one.

The Top 5 States Where Your Business Has the Best Shot

Utah: The Rising Star

• The Data: Utah snags the #1 spot for a reason. It leads the nation in average growth in the number of small businesses. Think about that for a second—more businesses are growing faster there than anywhere else in the country.
• Why It Matters: This isn’t just about bragging rights. It’s a sign of a thriving ecosystem where businesses can flourish. The environment supports new ventures. If you’re looking for momentum, Utah is where it’s at.

Texas: Everything’s Bigger (Including Opportunity)

• The Data: Texas comes in hot at #2. With its booming economy and business-friendly environment, Texas is a powerhouse. You’ll find a lot of resources here.
• Why It Matters: Texas offers a low tax burden and a large, diverse market. It’s got everything from tech startups to massive distribution centers. This market diversity will give your business a wider reach.

Florida: The Sunshine State of Business

• The Data: Florida ranks third and also has the longest average work week. That means your employees are putting in the hours.
• Why It Matters: Florida’s pro-business policies are not just talk; they’re real, and they impact your bottom line. The state’s commitment to a strong business environment can give you a leg up.

Idaho: The Underrated Contender

• The Data: Idaho quietly ranks fourth. It’s an often overlooked option that delivers. Idaho is seeing high growth rates.
• Why It Matters: Idaho presents an opportunity to get in on a state that is growing fast and offering a more affordable environment than some of the bigger names. Don’t sleep on Idaho.

Georgia: A Growing Hub

• The Data: Georgia rounds out the top five. It has a good balance between access to resources and the business costs that you need to keep in check.
• Why It Matters: Georgia is a state that has consistently put itself in the conversation as a strong business environment. If you’re looking for stable growth and access to a major market, this is your place.

The Bottom 5 States Where You’re Going to Struggle

New Jersey: A Tough Place to Start

• The Data: New Jersey is ranked dead last, and it’s not a surprise. High costs and tough regulations make it very difficult to succeed.
• Why It Matters: If you’re launching in New Jersey, be prepared to deal with high expenses and a challenging regulatory landscape. You might find yourself burning through cash just to stay afloat.

Rhode Island: Small State, Big Hurdles

• The Data: Rhode Island is another challenging spot. The state’s economy is smaller, and that limits opportunity.
• Why It Matters: Launching here means you’ll have less access to resources, and you’ll face a smaller potential market. This is not where you want to go if you’re looking for fast growth.

Connecticut: High Costs, Less Return

• The Data: Connecticut is plagued by high costs of living and doing business. The state is losing ground.
• Why It Matters: High costs mean less profit and a tougher battle to survive. You might find yourself paying more just for the privilege of being in the state.

Maryland: Regulation Overload

• The Data: Maryland has a complex regulatory framework. You will spend a lot of time in red tape.
• Why It Matters: These regulatory challenges will take a toll on your business. You’ll be spending too much time and money on compliance and not enough on your core business.

New Hampshire: Not So Free for Business

• The Data: New Hampshire rounds out the bottom five with some less than ideal business stats. The state has less access to financing than other states, and that makes it tough to get started.
• Why It Matters: Starting a business is hard enough. If you pick a state with limited access to resources, you’re making it even harder on yourself. Steer clear of this one.

What You Need to Consider

Labor Costs Aren’t Everything

• The Insight: Mississippi might have the lowest labor costs, but that doesn’t automatically make it the best place for your business. Think about it like this: cheap isn’t always good. Look beyond costs at the talent pool.
• Actionable Tip: Don’t get caught up in low costs alone. Consider the quality of the workforce in the area. What about higher education? What about specific industries?

Access to Financing is Critical

• The Insight: Iowa has the most accessible financing, but each state offers something different. You need to ask yourself if your state is a good fit for funding your specific niche.
• Actionable Tip: Don’t pick a state based on access to financing for the average business. Dig deep and make sure there are resources for you.

Don’t Forget the Bigger Picture

• The Insight: These rankings are a fantastic starting point, but they can’t tell the whole story. You need to look at your personal needs and circumstances.
• Actionable Tip: Use these rankings as one piece of the puzzle. Do deep research into your specific industry. Look at the market and the location. How will it affect you and your team?

The Takeaway: Do Your Homework

Look, starting a business is hard enough. The last thing you need is to set yourself up for failure from the start. These rankings from WalletHub are not just numbers on a page. They are signals. Use them. Do your homework, dive into your industry, and make a smart choice. It could be the single biggest factor in your success. Now, get out there and build something great, but make sure it’s in the right place. Don’t forget to look at your location, your business, and how they fit together before you jump in head first.