The signs are pointing to some good news for new business owners in Florida.
A WalletHub survey finds that, of all 50 states, the Sunshine State is the best to start a business in 2025.
While the low corporate taxes may be the first reason to come to mind, there’s more to the story, the report finds.
“Around half of all new businesses don’t survive five years, so the idea of becoming a business owner can be daunting, especially with the current high cost of living,” WalletHub analyst Chip Lupo said. “The best states have low corporate tax rates, strong economies, an abundance of reliable workers, easy access to financing and affordable real estate. On top of that, you’ll need to make sure you start in a place with an engaged customer base, if you’re operating locally.”
Here’s why Florida finds itself at the top of the list, and what other states came close.
Why Florida is #1 for starting a business
Of all the states, Florida ranks first in WalletHub’s category for business environment.
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That category takes into account things like average length of the work week, growth in number of small businesses, startups per capita, growth of average business revenues and more.
“There are plenty of good reasons why so many people start businesses in Florida, including the fact that it has the 11th-highest business revenue growth rate and the tenth-lowest corporate taxes,” the report says.
In the next two categories that WalletHub considers to determine an overall score, it may surprise you that Florida actually doesn’t even rank in the top 10 (but it still outperforms everyone else, collectively). They are: 1) access to resources and 2) business costs. Florida ranks 14th and 28th, respectively.
Let’s break this down further.
To determine access to resources, WalletHub looked into financing accessibility, venture investment amount per capita, human-capital availability, working-age population growth and more.
“Given the prevalence of retirees in Florida, you might assume the labor force is dwindling, but the opposite is true. In fact, the working-age population (age 16-64) is growing faster in Florida than in all but six other states. Plus, Florida has the third-highest percentage of workers who say they are enthusiastic about and committed to their work,” the report says.
Now, when it comes to business costs, WalletHub considered office-space affordability, labor costs, corporate taxes and more.
“Florida is the best state for starting a business in 2025, boasting the second-most startups per capita and the highest percentage of adults who engage in entrepreneurship. The number of small businesses in the state grew by nearly 16% between 2016 and 2022, the fourth-highest percentage in the country,” the report details.
Who else made the top 10?
Florida shares the podium with another southern state, Georgia, which came in second place. Utah, Texas and Idaho follows.
As for the states that are least-friendly to new business owners, WalletHub says they’re Rhode Island, Connecticut, New Jersey, Alaska and Maryland.
For a further break down, see the full study here.
