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Survey Says Austin Tops for Small Business

Photo by Caleb Bryant Miller for KUT News

Austin scored an A-plus in a survey of small business friendliness.

The capitol city ranks as the nation’s fourth friendliest city to small business, according to a survey by and the entrepreneurship-focused Kauffman Foundation.

The nationwide survey asked 6,000 of the small business owners registered with Thumbtack – a service which aggregates bids for hiring local help – questions about small business friendliness and finance in their city.

The responses, primarily from business owners in the service industry –caterers, yoga instructors, DJs, tutors, construction managers and more –were used to grades cities from A to F across several categories.

Fellow Texas cities Dallas and San Antonio ranked second and third, while Oklahoma City was named the most small business friendly city in the country. co-founder Sander Daniels tells KUT News he attributes Austin’s high score to easy-to-follow licensing regulations. But when licensing issues arose, he said “for the businesses, it wasn’t so much that the regulations existed that bothered them – in fact, many were happy that their professions were regulated. Rather, it was the difficulty of getting information about how to get licenses, or high annual renewal fees for their business licenses.”

Austin nailed down seven top five finishes across the different categories, but received its lowest rating in networking programs: a C-plus. Daniels speculates that score could be low because “competition within Austin is so fierce in a lot of industries that people don’t really want to share information.” 

And while Austin scored fairly high in most categories, the small business owners surveyed are not terribly optimistic about the future. The city was the 28th least optimistic about the future, out of the 40 cities surveyed.  While Austin business owners may not be an optimistic lot, Daniels says that many indicated that they see the availability of training programs as one of the big assets of the doing business in the city.

Business owners also indicated their gender and political alignment. Statewide, self-identified conservatives were 28 percent more likely to say that their financial situation was good or very good than liberal respondents.

Daniels says they asked business owners questions about the financial health of their companies and says, according to their responses, conservatives apparently have healthier business than liberals. But, he adds, “I really have no idea why that might be.”

Some of the cities that ranked lowest across the categories include Sacramento, San Diego and Tucson, Arizona.

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