May is Small Business Month, and entrepreneurs everywhere face uphill battles with funding, the economy, hiring and affordability in the effort to get their businesses off the ground.
NerdWallet calculated the best cities for starting a small business according to the following questions:
Is it easy to obtain funding? We measured the amount of C&I loans under $250,000 given out over a one-year period. NerdWallet's interviews with over 40 CEOs from lending institutions indicated that while traditional bank capital for start-up businesses is difficult to obtain, there are certain actions small business owners can take to improve their chances of getting approved for loans.
How business-friendly is the city? We assessed business-friendliness through the number of businesses per 100 residents and the small business friendliness rating from Thumbtack's Survey of Small Business Owners.
Is the local economy thriving? We assessed the state of the local economy through per capita income and unemployment rate.
Will hiring be easy? We proxied ease of hiring through population growth and the percentage of residents with bachelor's degree.
How affordable is it? Start-ups need to be able to grow cheaply until they get rolling, so we included the cost of living in this analysis.
2. Raleigh, NC
Business owners agree that Raleigh is a great place to start a business, and the city earned an A on Thumbtack's Survey of Small Business Friendliness. The city is highly educated (almost half the population has a college degree) and the cost of living is very low. Research is a huge industry in Raleigh, and the presence of Duke and UNC nearby contributes talent to the job pool. Resources abound in Raleigh, including Wake Tech Community College's Small Business Center, a program that offers one-on-one counseling, seminars, workshops, classes and a resource library.