Survey Says Austin Tops for Small Business

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

Other Texas cities Dallas and San Antonio ranked second and third, respectively, while Oklahoma City was named the most small-business friendly city in the nation.

Thumbtack co-founder Sander Daniels says he attributes Austin’s high score to easy-to-follow licensing regulations, despite some issues.

“For the businesses, it wasn’t so much that the regulations existed that bothered them,” Daniels says. “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 different categories, but received its lowest rating in networking programs: a C-plus.

“Competition within Austin is so fierce in a lot of industries that people don’t really want to share information,” Daniels says.

And while Austin scored fairly high in most categories, the small-business owners surveyed are not terribly optimistic about the future. The city was ranked 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 the availability of training programs is one of the big assets of the doing business in the city.

Responding business owners also indicated their genders and political alignments. 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 about the financial health of their companies. According to their responses, he says conservatives seem to have healthier business than liberals.

“I really have no idea why that might be,” Daniels says.

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