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The Places With the Youngest Entrepreneurs
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It may take years for entrepreneurs to gain experience and resources as they wait for the right time to take the leap and start a company. As it turns out, entrepreneurial hopefuls might be able to achieve their aim of founding a business much sooner — if they live in the right place.
LendingTree researchers have revealed which major cities in the U.S. have the youngest business founders. Using anonymized data from business owners seeking funding through LendingTree, researchers compared ages of business founders on their companies’ dates of origination in the 50 largest U.S. cities.
The analysis showed the average age for business founders in the U.S. is 39 years old, though founders in the top-ranking cities were 37 or 38 years old when starting their company. Millennials, who comprise the largest generation in the U.S., were the most prevalent entrepreneurs in each city in our study.
- New Orleans has the youngest entrepreneurs on average, moving up from its No. 3 position last year and knocking Salt Lake City from the top spot. The average age of recent business founders in the Big Easy is 37, nearly a year younger than last year’s youngest entrepreneurs from that city, who were closer to 38.
- Salt Lake City stays in the running at second place — there, the average founder is only slightly older than entrepreneurs in New Orleans.
- Philadelphia comes in at No. 3, jumping several spots from No. 11 last year. The average founders in Philadelphia are just under 38 when starting a business, a year younger than the previous average.
- At the other end of the list, Sacramento has the oldest founders. The average entrepreneur started a business shortly after turning 41. Sacramento fell from spot No. 44 last year, as the average age increased.
- Gen X is the second most common generation among new entrepreneurs in our study. Across the 50 metro areas, Gen X represented 36.5% of founders, with Orlando having the largest percentage of Gen X founders at 40.9%.
Cities with the youngest entrepreneurs
Entrepreneurs in our top three cities are achieving business ownership before hitting the age of 38. These cities provide programs and resources for startups and have a range of industries in which companies can succeed.
1. New Orleans
The average age of business founders in New Orleans is 37.04 years old. More than half of startup founders in the city are Millennials, while about a third belong to Gen X.
There are a multitude of resources in the city for new business owners, including incubator programs to assist emerging startups. Local nonprofit The Idea Village and Tulane University’s Freeman School of Business host the annual New Orleans Entrepreneur Week to showcase new businesses. Startups have played a major role in the revitalization of New Orleans since Hurricane Katrina devastated the city nearly 15 years ago.
2. Salt Lake City
The average age of business founders in Salt Lake City is 37.17, putting the city just a bit behind New Orleans. Millennials make up 52.9% of founders, while 32.2% are Gen X and 7.7% are Baby Boomers. Gen Z entrepreneurs — those born after 1997 — account for 5.6% of founders, more than the 4.5% of Gen Z founders in New Orleans.
Salt Lake City’s key industries include information technology, gaming, outdoor products, life sciences, health care, finance, logistics, manufacturing and distribution. Among the local support for startups is Silicon Slopes, a nonprofit organization that provides resources for entrepreneurs in the tech community. Utah as a whole has a low cost of doing business and has one of the best business tax climates in the country, according to The Tax Foundation.
Philadelphia moved up eight spots this year to round out the top three. The average age of business founders is 37.9 years old, down from 39.03 last year. Similar to the previous two cities, most founders are Millennials, at 50.40%.
Several accelerator and incubator programs are open to startup founders in Philadelphia looking for assistance, including the Philly Startup Leaders accelerator for early-stage ventures and the Ben Franklin Fintech Accelerator for financial technology businesses. Among the state of Pennsylvania’s key industries are natural gas, manufacturing, commercial agriculture, tourism, life sciences and plastics; in particular, a number of Philadelphia tech startups are making waves in the city.
The right location can boost business success
For new entrepreneurs, choosing where to do business could make or break the company. The more supportive and favorable a place is toward small businesses, the faster you can grow your venture.
When deciding where to launch your startup, keep these city characteristics in mind:
- Growing local economy: A startup will need a healthy economy and other businesses to survive. Check key economic indicators in cities you’re interested in — low unemployment and high consumer confidence in your area are positive indicators of a healthy economy with room for new companies to take root.
- Business-friendly tax policies: Keep an eye out for business-friendly tax policies. Many cities may charge lower taxes to local businesses, and some even provide tax incentives to attract new and expanding companies.
- Low cost of living: With lower expenses, you’ll need less capital to get your business up and running. These low costs can also keep your bottom line growing faster and keep your new business lean and competitive.
- Strong startup network: Most of the cities with the youngest entrepreneurs are also home to robust support systems and networks for new entrepreneurs and startups. Research your area of interest to see if it’s home to business incubators or accelerators, entrepreneurial networks or events or even a coworking space. Your local Chamber of Commerce or Small Business Administration office can be a great starting point to find business resources and organizations.
- Availability of business funding: Research opportunities to access or raise funds for your business. See if your city of interest is home to venture capital firms or programs that offer small business grants or other funding. Check out potential sources you could turn to for small business loans, too.
If you need a physical business location, local policies could also affect where you choose to set up shop. The planning or zoning board in your municipality typically decides which activities are allowed in certain spaces. Make sure your specific business activities are permitted in the city where you want to operate.
Most new business owners rent space rather than purchase property. Average rental costs in a city could be a determining factor in where you start your business. A commercial real estate broker or agent could help you find the right neighborhood for your budget.
Relocating your business could be challenging once you’re up and running, so make sure to thoroughly research the local business opportunities and support when getting started.
Anonymized data of borrowers seeking business loans on the LendingTree platform was analyzed to determine the average age of business founder in the 50 largest metropolitan statistical areas (MSAs). The data was limited to businesses founded within the last five years, and founders’ ages are from the date they founded their businesses. Generations are defined by the Pew Research Center as follows: members of the Silent Generation were born between 1928 and 1945; the Baby Boom generation between 1946 and 1964; Generation X between 1965 and 1980; the millennial generation between 1981 and 1996; and Generation Z after 1996.