You know the old saying about the three most important factors in real estate--"location, location, location."   Could the same be said for where you start your business?  Fortune Small Business and the Kauffman Foundation certainly think so.  This month they once again brought out their "Best Places to Launch" report and the findings just might surprise you.  It did me because California, where Peter and I are located, is nowhere to be found on any of the lists that include the top 50 cities to start a business in the small, medium, and large categories. In fact, as you can see by their map, the entire western third of the country is left out.

It surprised me because California is a very entrepreneurial state--we're known for that; but then it didn't surprise me because California is perhaps the most difficult place in the U.S. in which to do business due to taxes, regulations, and a legislature that seems to be anti business.  So, yes, a lot of people get started here, but once they have a business that looks like it's going to need a lot of employees, they think about where to move so the cost of doing business isn't so high.  In their report, Fortune and Kauffman looked at such things as per capital income, hourly wages, workforce quality, crime rates, taxes, and foreclosures to come to their conclusions. Some of those factors explain why California didn't make the list, but the entire Pacific time zone?

So which are the best cities in each category?  Of the large cities, #1 is Oklahoma City: of the medium-sized cities, #1 is Huntsville, Alabama; and of the smaller towns, #1 is Billings, Montana. Wow! I'm sure if you had been asked where you wanted to start your business, those three cities might not have been in your top five.  Nevertheless, Oklahoma City is home to many biomedical start-ups and the "gutsy" venture capitalists it takes to invest in that area.  Couple that with an affordable standard of living and for many it's a winning combination.  Huntsville is home to NASA, which has made it a thriving city for tech start-ups; and Billings is known for spectacular scenary and low taxes (the sixth most favorable tax climate in the country). 

Of course, keep in mind that location isn't the only factor in a successful start-up.  More and more people are concerned with quality of life for themselves and their employees.  They also care about keeping business costs low so they can be more competitive in a global market.  Check out the article to see more of the cities on the list.  Keep an open mind; after all, you want to start somewhere where you have a real shot at success and a great life.