The Kauffman Foundation has ranked Vermont number five in its state-by-state listing of business start-up activity. “The Kauffman Index: Startup Activity” from the Kauffman Foundation brings together data on entrepreneurial trends nationally, at the state level, and for the 40 largest metropolitan areas of the United States. Vermont moved up in this year’s index from the 12th spot in 2014. The report found that startup activity was up in 32 of the 50 US states last year, and 18 of the nation’s top 40 metropolitan areas also saw increases in new venture activity.
The Index has three components:
- Rate of New Entrepreneurs: a broad measure of business ownership
- Opportunity Share of New Entrepreneurs: an indicator of the percent of new entrepreneurs starting businesses
- Startup Density: the number of startup firms divided by total population of a place
Although startup activity tended to be highest in the western and southern states overall, the five states that ranked at the top of the 2015 Index were Montana, Wyoming, North Dakota, Colorado and Vermont.
The new accolade comes on the heels of Burlington’s #9 ranking in a Feb. 2015 Forbes list of the country’s top ten most innovative tech hubs. A recent story in Atlantic Monthly on the city’s growing technology sector called Burlington a “Silicon Valley in Vermont.”
“The Kauffman ranking reflects the inherently innovative culture of the people of Vermont,” said Joan Goldstein, the Commissioner of the Vermont Department of Economic Development. “Additionally, we have created quite the support system for entrepreneurs, including the research-based University of Vermont, the Vermont Center for Emerging Technologies, the Vermont Small Business Development Centers, the Vermont Economic Development Authority and a variety of community banks and micro-lenders. One of our goals is to make it easier to start a business in Vermont. This ranking proves that we have established the ecosystem to make it happen”.
“Historically, the Plains and Rocky Mountain regions have not been thought of as hotbeds of entrepreneurial activity,” said Arnobio Morelix, research analyst at the Kauffman Foundation, and one of the studies’ authors. “But entrepreneurship is closely associated with economic growth, so it should not be surprising that some of the states seeing increased levels of startup activity have experienced high rates of real GDP expansion in recent years.”