The barriers to launching a new business have largely become nonexistent given the availability and ease of digital marketing and AI tools, but where an entrepreneur builds it matters.
From major cities to small towns, where an entrepreneur launches their business from matters. Cytranet has supported over 100,000 businesses from around the country within the past 17 years, looking to adopt a reliable business communications system to help aid the growth and scalability of their brand.
Through an analysis of the 200 most populous U.S. cities, we developed an Entrepreneurial Index measuring factors such as each city’s new business application rates per capita, average SBA loan size, average LLC filing fee, and more to determine the best and worst cities for founders to start and scale their businesses across the United States.
Cytranet also surveyed 1,000 business owners to understand the costs, funding, barriers, and communication challenges of starting and running a small business.
Here are the findings from our research.
Top 20 U.S. Cities to Start and Scale a Business in 2026
1. Augusta, GA, ranks as the best city to start and scale a business
Augusta, Georgia, takes the top spot as the number one city in the U.S. for starting and scaling a business in 2026. Augusta has steadily evolved into a growing business destination as it becomes a lower-cost city, attracting many entrepreneurs and small business owners.
For only $100, an individual within the area can file to incorporate their business, which is relatively inexpensive. Renting an office space in Augusta is also relatively cheaper than most cities listed, at $16.03 per square foot, one of the 20 most affordable prices per square foot on this list, which is ideal for new business owners looking for more space but for less on the dollar.
2. Garland, TX
Garland, Texas, is the second best city to start and scale a business. For founders looking to tap into the broader Dallas-Fort Worth economy, Garland is the best city to do so, offering a more affordable, business-friendly environment that is closer to a major consumer market.
Garland has one of the ten highest average SBA loans per city, at $741,028, which is a decent amount of capital to help a new business get up and running. On top of that, the city offers the most affordable rent for commercial office space at $11.60 per square foot, which is perfect for a larger new business looking for more space at a very affordable price.
3. Atlanta, GA
Atlanta, Georgia, rounds out the top three, ranked as the third best U.S. city to start and scale a business. Atlanta has established itself as one of the country’s fastest-growing and most dynamic business economies today, and it shows: for every 1,000 residents, around 44 business applications are filed on average.
A city with a diverse population of over half a million people is bound to catch the eyes of many new business owners looking for a home to establish their brand and grow a consumer base, especially when they can potentially secure an average SBA loan of $594,728 to kickstart their venture in one of the nation’s largest metropolitan areas.
4. Hialeah, FL
Hialeah ranks fourth among U.S. cities for starting and scaling a business. Positioned only 20 minutes away from downtown Miami, the area offers new founders an opportunity for major growth while maintaining relatively low costs. The city averages about 48 business applications per 1,000 residents, and it costs only $155 to incorporate a business in Florida.
Renting a commercial office space in the Hialeah area is even more convenient, as new business owners can pay an average rent of $21.83 per square foot, nearly $40 less than their neighbors in Miami, benefiting from a larger market at more affordable rates.
5. Montgomery, AL
Montgomery, Alabama, ranks fifth among the best U.S. cities for starting and scaling a business. Fast internet connections are essential for any business, and Montgomery, Alabama, provides them with broadband speeds of 313 megabits per second.
The city also has an average SBA loan amount of $1,034,523, indicating there is sufficient capital available for a business to secure, whether through a commercial bank, credit union, or alternative investor to help kickstart the business’s growth.
6. Lakewood, CO
Lakewood is ranked the sixth best U.S. city to start and scale a business. Lakewood is an appealing city, especially for entrepreneurs, as it combines a close proximity to Denver’s thriving market with affordability. For one, the broadband speed in the area is solid at 414 megabits per second, enabling businesses to efficiently manage communications, transfer important files, and maintain a strong digital and social media presence.
Commercial rent in the area is also very affordable at $24.15 per square foot, perfect for founders near a major market like Denver to secure affordable commercial office space while allocating more funds to other important functions of a new business.
7. Denver, CO
With around 33 business applications per 1,000 residents, Denver ranks as the seventh best U.S. city for starting and scaling a business. With around 734,000 people living in the city, many individuals will see an opportunity to tap into the market with a new business.
Seizing that opportunity requires capital, and Denver offers an average SBA loan amount of $502,314, which, if secured, could help rent a relatively affordable commercial space that costs only $25.02 within the city.
8. Springfield, MO
As the eighth best U.S. city to start and scale a business, Springfield, Missouri, has become a promising city for entrepreneurs. Its low operating costs are a major contributor, as it only costs $50 to incorporate a business in Missouri, on top of an average commercial rent of $15.14, the sixth-lowest average price listed. The city also has great internet connectivity and broadband speeds, which are essential for a modern-day business, with speeds of 337 megabits per second.
9. Macon, GA
Macon, Georgia, ranks as the ninth best U.S. city for starting and scaling a business. The city is continuously growing, with close to 160,000 people living within it, creating opportunities for entrepreneurs looking to expand their new businesses.
For new founders looking for office space, commercial rent affordability is notable in this city at $15.30 per square foot, which is among the ten most affordable prices listed. Macon, Georgia, also ranks among the 20 cities with the highest average SBA loan amounts at $704,766, which is a huge starting point for new founders looking to grow and scale their businesses quickly.
10. Aurora, CO
Rounding out the top 10 is Aurora, Colorado, the tenth best U.S. city for starting and scaling a business. Similar to Lakewood, Aurora, being just outside a major business hub like Denver, is attracting many founders to set up shop with its access to more regional business opportunities.
What separates Aurora from Lakewood and Denver is the average commercial rent pricing. At $16.53, one of the 20 most affordable prices per square foot listed, new business owners can find a relatively cheaper headquarters to rent while reaping the economic consumer market opportunities provided by Aurora’s surrounding areas.
For the full list of the best U.S. cities to start and scale a business in the U.S., check out the table below.
The Complexities Entrepreneurs Face in 2026
There are many challenges to starting a business in 2026 that span farther than just the initial business idea.
Our survey of 1,000 entrepreneurs and new founders reveals that the path to launching and scaling is not blocked by a single major issue but by a combination of financial, managerial, and regulatory pressures that make it more challenging for businesses to grow and succeed.
Over 30% of entrepreneurs spent $1,000 or less to start their businesses
A majority of the entrepreneurs surveyed, 34%, stated they have spent $1,000 or less to start their business. A combined 61% of entrepreneurs surveyed spent $5,000 or less, while a combined 39% stated they have spent between $5,000 or more to launch their venture.
A small portion of those entrepreneurs, 11%, had startup costs exceeding $25,000 to get their business going.
More than 50% of entrepreneurs use their personal savings to fund their venture
In 2026, securing funding, especially for a new business, can be extremely challenging as SBA and bank loan criteria are becoming stricter, and we are far from living in a time of zero-percent interest rates.
When it comes to securing initial funding for their business, more than half of entrepreneurs said they have drawn on their personal savings. Around 15% of the entrepreneurs secured funding from friends and family, which is only 5% less than the number of respondents who used either credit cards or secured bank loans to start their businesses at 20%.
Start-up costs and lack of customer demand are the biggest roadblocks to starting a new business
Entrepreneurs are facing multiple challenges when starting a business from scratch. From the initial costs to get off the ground to managing the constant flood of customer and team communications, the hurdles rarely occur one at a time. Our survey discovered that most respondents, 30%, stated that startup costs are the major pain point for entrepreneurs looking to establish a new business, indicating that money is a barrier to starting a business. A combined 44% of respondents cited a lack of customer demand and access to funding as major barriers to starting a business, highlighting the need for easier avenues for small business funding and potential oversaturation in the market. Only a combined 17% of respondents indicated that hiring talent and managing communications were their biggest issues when starting a business.
Entrepreneurs’ biggest communication challenge is managing customer inquiries
Strong communication processes and methods are essential to building a successful business, whether it is keeping a team aligned or earning the trust of the consumer base. Respondents, however, called out major challenges they struggle with the most when it comes to communication within their businesses.
Around one in four entrepreneurs labeled both managing customer inquiries across channels at 26% and not having a professional business presence at 24% as the biggest communication challenges. Around one in five entrepreneurs, or 21%, stated that keeping their team communication organized is a major communication issue, while only 12% stated that using too many communication tools has caused a major problem in their business communication processes.
Around 50% of businesses use multiple tools for customer and internal communications
New business owners are looking for ways to make it easier to communicate with their employees internally while communicating with their customers externally. With the number of communication tools and programs available, most of which are disjointed from other business workflows, many struggle to decide how many to use to communicate efficiently.
Half of the respondents stated that they mostly use one tool and sometimes two for internal and external communications. Another 40% collectively reported relying on three to four different tools to manage day-to-day communication. A small portion of entrepreneurs, 3%, reported using seven or more different tools to manage day-to-day business and consumer communication.
This all shows that a decent number of entrepreneurs are having trouble finding the right tool or solution to address problems like missed messages, slow response times, scattered information, and more. For a new business, that can be not only inconvenient but also hinder the establishment’s progress.
Nearly one-third of business owners wish they had built an online presence sooner
Each and every day, there is a major news announcement or new trend that many small businesses with a strong internet presence manage to capitalize on and reap the success from. There are other small businesses, however, who struggle with this and look back on what they could have done differently when it comes to building a brand presence online. Nearly 30% of business owners responded that they wished they had developed a website or a stronger online presence earlier. Beyond building an online presence, another 30% of the entrepreneurs surveyed wished they had set up invoicing systems and accounting processes sooner, which is very important for measuring how much money is coming in and leaving the business.
Business owners want to automate invoices, email communications, and appointment scheduling tasks
According to the survey, 21% of owners are still manually handling their invoices and payments within their business while wishing they could automate those tasks. A combined 53% of business owners stated they still manually send emails and messages, schedule appointments, and conduct customer follow-ups, which can be extremely time-consuming and take away from other important tasks that may require only the entrepreneur’s skills and knowledge to keep their business running.
Remote work is still desired among half of startups
The freedom to work from anywhere still seems highly favored among new business owners, as our survey data shows that half prefer to run their businesses entirely remotely. Around 25% of entrepreneurs prefer to run their business on a hybrid model, and around 24% prefer to run it in a dedicated office or coworking space.
30% of business owners are willing to relocate for lower operating costs
Startup costs play a major role in where entrepreneurs choose to locate their businesses, as major companies like Tesla have moved their headquarters from one city to another in search of lower taxes and operating costs. Of the business owners surveyed, 30% said they would most definitely relocate their business. 38% of the entrepreneurs surveyed said they would consider relocating their business to lower costs, and about 33% said they would not relocate if costs were lower.
Half of business owners want greater AI integration into their companies
The rise of AI has prompted many companies to explore the technology and find ways to use it, especially in their business operations. According to our survey, more than half of entrepreneurs consider using AI in their businesses. The other 45% of entrepreneurs recorded being more reluctant to integrate AI within their core functions. The benefits of integrating AI into a new business include enabling business owners to do more with less, which is ideal for an early-stage business.
The downside that might make businesses reluctant to integrate AI technologies is their cost and the uncertainty of implementation. Many AI tools can be expensive to implement well, and the cheaper versions often produce generic outputs that make it harder for a business to differentiate itself from the competition.
Nearly 30% of business owners want to improve data, sales, and marketing with AI
Data, sales, and marketing are key pillars of a successful business, and nearly 30% of business owners stated they plan to use AI to strengthen their data, sales, and marketing operations. From automating repetitive tasks and improving customer targeting to generating deeper business insights, AI is quickly becoming a valuable tool that entrepreneurs recognize as potentially aiding their business growth.
Wherever you choose to build a brand as a new business owner, customer interaction will always be a major factor in your success. Cytranet’s virtual phone service lets owners manage business calls, texts, and video meetings from anywhere, with no physical hardware required.
Cytranet’s NEXT platform combines those interactions, including voice, SMS, chat, email, and reviews, into a single view, making it easier for a business to deliver consistent, professional service from day one. Finally, the XBert AI Receptionist ensures no opportunity slips through, eliminating missed calls and scheduling gaps while capturing customer information to generate new leads, the kind of follow-through that drives long-term growth no matter which part of the country a founder calls home.
2026 Entrepreneur Index and Survey Methodology
To identify the top U.S. cities that give entrepreneurs the best chance at starting and running a successful business, we built a weighted index of the 200 largest U.S. cities across metrics, including each city’s new business application rate per capita, average SBA loan size, average LLC filing fees, number of coworking spaces, average commercial rent per square foot, and broadband speeds. Data were collected and analyzed on April 28, 2026, using the most recent complete sources available.
Business applications: New business application data was sourced from the U.S. Census Bureau’s Business Formation Statistics, Annual County Data. The most recent complete annual data available at the time of analysis covers calendar year 2024, released June 2025. 2025 county-level data will not be released until approximately June 2026. Because BFS does not publish below the county level, cities sharing a county receive the same per-capita rate, calculated against the Vintage 2024 county population estimates from the U.S. Census Bureau.
SBA loans: SBA loan data was sourced from the U.S. Small Business Administration’s 7(a) FOIA dataset, covering all approved loans from fiscal years 2023 through 2025. For Enterprise, Paradise, Spring Valley, and Sunrise Manor, Nevada, businesses register their borrower address under Las Vegas in SBA records, making direct city-level attribution unavailable. We used the Las Vegas SBA loan total and loan count as a proxy for these four areas.
Broadband speeds: Where city-level broadband data was unavailable, we substituted the broadband speed of the nearest metro area city as the closest reasonable proxy.
