Climbing the ranks to No. 2 is the Lone Star State. Texas, which is also among the fastest-growing states, has cultivated a business-friendly reputation that appears to be attracting a high volume of women-led organizations and startups. Major tech hubs in Austin and Dallas have made Texas a great place for venture capital, with women-led startups pulling in $814 million in VC funding in the last five years. The state doesn’t do as well when it comes to average income metrics, but with a 0% state income tax, women business owners can expect an average $62,945 yearly income to go farther in Texas than it would in most other states.
Florida bumped up one spot from 4th last year, thanks largely to the fact that 2.26% of all women in the state run their own business (4th overall). Women-led startups have also pulled in $286 million in venture capital over the past five years. The Sunshine State’s lack of an income tax is quite helpful as well. The startup potential here is obvious as companies look beyond Silicon Valley – for instance, investors have tapped the sunny shores of Miami as fertile ground for startups shedding the office building lifestyle.
While it’s taken a modest tumble from 2nd to 4th place, Washington is still a great place for women-led businesses, which account for nearly a third (29.9%) of all firms within the state, up from 28.2% last year. The self-employment rate for women also rose from 1.66% to 1.91%. The Evergreen State’s I-5 corridor remains one of the biggest tech hubs on the West Coast outside of Silicon Valley, which helped women-led startups nab $481 million in venture capital funding over the past five years. If there’s a Cascades-sized shadow here, however, it’s the relatively high rate of failure for startups. Washington finished dead last in startup survivability.
The state does especially well in how much money women business owners earn – they rake in $81,839 per year (2nd overall in the nation). 22.6% of employees in the state are at women-led firms, which ranks 4th. This Mid-Atlantic state also does well in the percentage of employer firms led by women at 27.5% (10th nationally). However, fledgling startups can struggle here as Maryland’s 76.7% startup early survival rate sits in a lowly 39th position.
Montana challenges many perceptions of what constitutes a woman-friendly business environment. While venture capital is scarce there, the women of Montana are the most likely (2.42%) in the nation to own their own business. Not only that, but a sizable portion of Montana’s workforce (22.2%) works at a women-led business. Montana is held back a bit by the average income of business owners, which ranks among the lowest in the nation. Some of this is mitigated by Big Sky Country’s relatively low cost of living, but its higher-than-average upper income tax rate can cut into take-home pay. Startups that take root in Montana stand an 81% chance of going the distance, the 3rd-highest success rate in the nation.
It’s no surprise to see Massachusetts jump 13 spots to No. 7 as the state’s educational prowess has long powered the local startup scene. For our rankings, Massachusetts is part of the exclusive $1 billion club alongside California and New York as the only three states to have garnered over $1 billion in venture capital funding for women-led startups in the past five years. Women business owners also earn over $97K per year here, by far the highest average in the country. However, the Bay State struggles in the other three gender-specific categories we measured – Massachusetts ranks in the 30s for all three metrics.