Austin's status as an entrepreneurial powerhouse has been recognized in WalletHub's just-released list of the "Best Large Cities to Start a Business" for 2025. The Texas Capital moved up five places this year to become the No. 3 best city to start a business nationwide.
The annual report ranked 100 U.S. cities based on 19 metrics across three main categories: business environment, access to resources, and costs. Factors considered in the report include five-year business survival rates, job growth comparisons from 2019 and 2023, office space affordability, and more.
The sunny Florida cities of Orlando (No. 1) and Tampa (No. 2) were the only two places that eclipsed Austin as the best large cities for starting a business in 2025. Florida cities dominated the top 10 overall, with Jacksonville (No. 4), Miami (No. 5), St. Petersburg (No. 6), and Hialeah (No. 10) also earning acclaim for their thriving business sectors.
Austin's business climate has improved significantly since 2024, when the city previously ranked No. 8. Earlier this year, the Austin-Round Rock-Georgetown metro nearly topped a separate list of top tech hubs in the South.
Austin has the second-best business environment out of all 100 cities in the report, and it's the city with the fourth best access to resources, including financial factors and college-educated population numbers. The report says Austin has some of the highest employment growth rates and venture investment per capita in comparison to all other cities.
"In addition, the city has some of the highest college-educated population in the country, which can provide a boost to new businesses by allowing them to hire qualified employees," the report said. "Businesses that are currently in Austin are thriving, as the city has a very high growth rate in the number of small businesses."
Major Austin-based businesses like Oracle, Tesla, and Dell Technologies reigned superior on Fortune’s 2025 list of "America’s Most Innovative Companies."
The city also tied with Boise, Idaho and Fresno, California for the No. 1 highest average growth of small businesses.
Though Austin ranked among the top five in the first two categories, it fell behind in the national "business costs" comparison and ranked No. 81.
Elsewhere in Texas
Austin was the only Texas city to rank among the top 10 best big cities to start a business in 2025, but Dallas-Fort Worth had the greatest concentration statewide. The DFW area contributed six out of 13 total Texas cities, and all of them among the top 50: Fort Worth (No. 11), Arlington (No. 15), Dallas (No. 16), Irving (No. 22), Garland (No. 29), and Plano (No. 43).
Other large Texas cities that were named among the best places to start a business in 2025 include Lubbock (No. 33), Houston (No. 34), Laredo (No. 44), San Antonio (No. 64), El Paso (No. 67), and Corpus Christi (No. 70).
"Starting a business can be very scary, considering one in every five startups doesn’t make it past the first year," said WalletHub analyst Chip Lupo. "That’s why it’s especially important to live in a city that provides an environment where new businesses can thrive, with enough capital, workers and customers to keep it going long-term."
The top 10 best large cities to start a business in 2025 are:
- No. 1 – Orlando, Florida
- No. 2 – Tampa, Florida
- No. 3 – Austin, Texas
- No. 4 – Jacksonville, Florida
- No. 5 – Miami, Florida
- No. 6 – St. Petersburg, Florida
- No. 7 – Boise, Idaho
- No. 8 – Atlanta, Georgia
- No. 9 – Raleigh, North Carolina
- No. 10 – Hialeah, Florida
