Minnesota Ranks #1 for Small Business Survival—But There’s a Catch!

Some new data sheds light on which states are the best for starting a new small business. Minnesota shows mixed results, with one area where we rank at the top.

Lending website Lendio.com shared some interesting information from a study they commissioned. The goal was to "see the state of the small business landscape across the country."

Florida has now taken the number one spot to start a small business, overtaking Texas, which has dropped to number two. Minnesota is ranked 22nd overall, but we’re number one for survival rates.

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Minnesota's Top Ranking in Survival Rates

According to the study, the 5-year survival rate for a new small business in Minnesota is 57.60%. That’s the best in the country.

Alaska and West Virginia follow closely behind, both with survival rates above 57%. Compare that to Missouri, which ranks last, with only 44.60% of small businesses surviving five years.

Challenges with Corporate Income Tax

It’s not all great news for Minnesota, though. The state also ranks number one in corporate income tax rates at 9.8%.

Minnesota is one of only three states with a rate above 9%, with Illinois and California being the others.

A State of Contrasts for Small Business

While Minnesota tops the charts for small business survival, the high corporate tax rate is a significant challenge. Entrepreneurs here face a promising but tough environment.