New small businesses have a tough time in these 10 cities, report says

March 28, 2018


If you want to start a small business, you might want to skip Cincinnati. A new study from LendingTree looked at data from small-business owners around the country to determine where small businesses thrive and where they fail, and Cincinnati tops the list of the “worst cities” for new small businesses.

LendingTree took a deep dive into the issue by looking at data from 80,000-plus new small-business owners who sought capital through its small-business loan marketplace.

Specifically, it looked at businesses that earn an annual revenue of less than $7,500,000, have been in business for at least six months and no longer than 60 months, and submitted a loan query to LendingTree between Jan. 1, 2016, and Jan. 23, 2018. The self-reported data was then limited to the 50 most populous metropolitan areas, and with that, a list was born. While this certainly isn’t definitive, it could be something good to consider if you’re launching a new enterprise somewhere in the United States.

Topping the list of places that are hard on small businesses was Cincinnati, where startups had an average annual revenue of just $198,516 and only about 79.8% of businesses reported they were profitable.

Here are the 10 worst cities, per LendingTree:


    Rochester, N.Y.


    Louisville, Ky.

    Birmingham, Ala.


    Harrisburg, Pa.

    New Orleans

    Virginia Beach, Va.


Now that you’ve scrapped plans to open your artisanal eraser business in Rochester, consider Sacramento, where “startups thrive” with an average annual revenue of $315,661, and where 84.3% of rising small businesses were profitable.

Here are the 10 best cities, per LendingTree:

    Sacramento, Calif.

    Grand Rapids, Mich.

    Portland, Ore.

    Knoxville, Tenn.



    Tulsa, Okla.

    Albuquerque, N.M.

    Fresno, Calif.

    Los Angeles

    Oklahoma City


Fast Company