With all of the downtime during the 2020 pandemic came plenty of time for folks to commit to passion projects. For many, those passion projects ended up turning into full-fledged businesses – whether it be out of necessity, promising growth potential, or just pure faith, Americans were ready to take the leap into entrepreneurship more than ever before.
According to numbers from the U.S. Census Bureau, the U.S. saw a record high of new business applications in 2020 at 4.4 million. The American Dream didn’t stop there… In 2021, yet another record high of new business applications in the U.S. was set at a whopping 5.4 million.
In light of all of this entrepreneurship, the software company, OpenPhone, sought to uncover where exactly in the country was seeing the most rapid growth and success of new businesses. OpenPhone ranked 1,000 U.S. cities on factors including year-over-year population growth, percent increase of new business applications, startup survival rate, and change in startup seed and pre-seed funding over the years. According to these factors, these are the top 25 fastest-growing cities in America for small businesses:
Entrepreneurship expanding coast to coast
The top 25 includes representation from coast to coast, proving that the American dream of entrepreneurship is still very much alive no matter where you end up in the country. Data shows cities from West Coast’s California and Montana to East Coast’s Florida and New York, but the #1 fastest-growing city for small businesses lands on the East in Apex, North Carolina. Apex lands right in the center of North Carolina’s “Research Triangle”, so it’s no surprise that small businesses are sprouting from this hub of innovation in America. The events of 2020 surely didn’t slow Apex down, either, as the NC city saw a 1.86% population growth and 21.49% growth in new business applications from 2019-2020.
Miami business are making their mark
One major factor of OpenPhone’s research was looking at each city’s reported startup pre-seed & seed funding over the years from 2019-2021, and some of the numbers were quite impressive for startups. Of course, the usual business hubs, San Francisco, New York, and Los Angeles all had the top 3 highest funding amounts in 2021 (respectively), but Miami came in right behind them with an impressive $333 million in startup funding. This amount was a 320.52% increase from the previous two years which is a YoY growth rate much higher than #1 San Francisco’s 32.94%. Miami established a name for itself in the business world last year, with many people even wondering if it would become “the next Silicon Valley” – these end of year numbers prove that might just be the case.
Entrepreneurs in Maryland, on the other hand, weren’t so lucky with their startup funding amounts – Baltimore and Bethesda both saw steep funding declines of over 50%. Maryland’s economy is largely influenced by government operations, as they are home to 11 US military bases including the NSA Annapolis Navy Base, one of the largest military bases in the whole country. Whether or not the small business operations were specifically military-related, there surely has been a decline in small businesses relying on government contracting to get their start.
The trend continues
With consistently high small business growth and survival rates, the spirit of entrepreneurship in the US doesn’t seem to be slowing down any time soon. Intuit’s 2022 small business forecast predicts that “up to 17 million new small businesses will be formed” this year and that 44% of existing small businesses are looking to expand. This means that not only will there be a plethora of businesses to come, but also that there’s a good chance they’ll perform well if their 2021 predecessors are already expanding. For those who have ever wanted to start a business, it seems there’s no better time. Especially for those living in Apex, North Carolina.
Read the full story here: https://www.openphone.com/blog/small-business-cities/