Today, there are over 12.3 million women-owned businesses in the United States, a number that has increased 21 percent within the past five years. Though women comprise a substantial portion of the economy, not every state is accommodating to the unique needs or challenges faced by women in business.
By assessing factors like the start-up climate, economic health, women’s health and safety, and women’s business opportunities, FitSmallBusiness has developed a list of the country’s top hubs for women in 2020. If you’re searching for a business backdrop that is both female-friendly and financially strategic, look no further. The following states have it all for female startups.
1. Colorado
Like its peaks, the opportunities for women in Colorado are sky-high. The state has a competitive corporate tax rate which has facilitated its growth as a startup hub over the past few years and continues to draw in hoards of entrepreneurs. The cities of Boulder and Denver house many major technology businesses and startups.
In addition to a generally thriving local economy, Colorado has a number of state programs designed to boost women’s success. For example, the Women’s Foundation of Colorado focuses on issues like equal pay and childcare, and the Women’s Collaborative for Colorado is a Denver-based organization that advocates for pro-women legislation. There are also strong local resources geared toward small businesses, such as the Minority Business Office and the Colorado Small Business Development Center.
The one drawback of Colorado is that the cost of living is slightly above the national average, but ultimately the pros outweigh the cons for the over 231,020 women-owned businesses currently in Colorado who have seen their revenue increase 8.5 percent since 2014.
2. California
Home to Silicon Valley and the majority of the country’s venture capital dollars, the Golden State is well-regarded as an entrepreneurial epicenter. However, what’s lesser known is the state’s progressive policies and practices that make it an attractive location for women. For example, Pitchbook’s Female Founders Dashboard ranked California #1 in terms of VC funding for women (proportional to availability in the state).
California also has an abundance of resources supporting its female entrepreneurs, such as the Women’s Business Enterprise National Council’s regional partner, WBENC-West, and the Southern California Minority Development Council. Los Angeles and San Francisco, in particular, boast long lists of ancillary services like accelerators, incubators, events, financing, networking, and membership organizations.
With all these resources and more, it’s no surprise that California is home to the greatest number of women-owned businesses in the U.S.: 1.55 million. It is important to note, however, that California has the second-highest cost of living in the country, after Hawaii, and that its corporate taxes are considered to be “some of the most oppressive of any state.”
3. Washington
One of the benefits of Washington over some of the other states on this list is that while still housing one of the nation’s key entrepreneurial hubs — Seattle — the cost of living is more reasonable. On top of that, Washington has no corporate income tax.
Personal finance website NerdWallet selected Seattle as the second-best state for female entrepreneurs after San Francisco due to its high median income and low unemployment rate. “With 12.5 businesses per 100 residents, the city is highly entrepreneurial, and women own around 4 of those businesses,” according to the Seattle Business Magazine.
As of 2019, there were an estimated 215,185 women-owned businesses in Washington which generate around $33.6 billion in annual revenue — up 10 percent from 2014. Entrepreneurs in the region are supported by a plethora of female-focused resources like the Women’s Funding Alliance, 100% Talent, Women’s Funding Network, and the WA Women’s Foundation.
4. New York
New York is the country’s third most expensive state in which to live, but the state’s copious resources and thriving entrepreneurial landscape still earn it a top place on this list.
According to the city’s Economic Development Corporation and Department of Small Business Services, there are over 350,000 women-owned businesses across New York’s five boroughs, which generate more than $50 billion in revenue each year. Female entrepreneurs in New York benefit from the state’s high, early start-up survival rate and index of business opened by choice instead of because of economic hardship, as well as unique access to VC dollars.
Additionally, there’s a lot to gain from the expansive docket of public and private resources available, such as Women Entrepreneurs NYC, the Women’s Business Center, the Women’s Center for Education and Career Advancement, the New York Women’s Agenda and many more. The NYC Commission on Gender Equality also does a lot of work to make the state safe for women through programs like the 16 Days Against Gender Violence campaign.
5. Texas
Texas is well-known as one of the best locations for women starting businesses. Particularly because of Austin, which has emerged as a breakout city for entrepreneurs in recent years. The state has an affordable cost of living — the living wage is 27.2 percent higher in California than in Texas — and is considered to have an extremely high quality of life. Additionally, there is no corporate income tax, which explains why it’s a magnet for Fortune 500 companies like Exxon Mobil, AT&T, and American Airlines.
However, compared to some of the other states on this list, Texas ranks slightly lower for its political and economic support of women. That being said, there are a number of organizations like the Texas Women’s Foundation and the Texas Women’s Business Enterprise Alliance that make Texas a place where women can thrive.
Overall, there are nearly one million women-owned businesses in Texas, employing over 835,773. CNBC selected Texas as the Top State for Business in 2018 and the Lone Star state is actually the country’s second-largest economy, with the fourth-highest average growth in the number of small businesses.
