Best cities for women entrepreneurs

In good company

Entrepreneurship is not for timid women.

“A key ingredient in successful business ownership, and one that is hard to measure, is passion,” says Julie Weeks, president and CEO of Womenable, an organization that aims to support women entrepreneurs. “If you do not love what you do, and [aren’t] willing to live and breathe it 24/7, then all the spreadsheets in the world will not lead to success.”

Thanks to their passion — and smarts and skills — more women are starting their own businesses. For those who want to follow suit, start by checking out NerdWallet’s analysis of the best cities for women entrepreneurs.

Take me to Colorado and California

After weighing factors such as financing opportunities, local economic health and business climate, two states stand out — Colorado and California.

Boulder, Colo., beat out the other 173 U.S. metro areas analyzed to take the No. 1 spot in the study.

 

In Boulder, there are 4.42 women-owned businesses per 100 residents — compared with 2.48 businesses per 100 residents, which is the average of the 174 cities NerdWallet examined. Entrepreneurs in Boulder attract an outsized share of funding opportunities, too. Our study found that the average number of Small Business Administration loans guaranteed is about 15 per 100,000 residents. In Boulder, there are 41 SBA loans guaranteed per 100,000 residents.

About 30 miles from Boulder is Denver, which claims the No. 3 spot among the best metro areas for women, while Fort Collins, Colo., came in at No. 10.

The Golden State makes a strong showing as well. The California metro areas of Santa Cruz, Santa Rosa, San Luis Obispo and San Francisco claim four of the top 10 spots.

The top 10 U.S. cities for women entrepreneurs

No. 1: Boulder, CO

  • Avg. revenue for women-owned businesses: $91,050
  • Women-owned businesses per 100 people: 4.42
  • Women’s median annual income: $48,223
  • Women’s annual income as a percent of men’s income: 77%
  • Unemployment rate: 5.9%
  • SBA-guaranteed loans per 100,000 residents: 41.17
  • Average SBA-guaranteed loan: $217,912

No. 2: Bridgeport-Stamford-Norwalk, CT

  • Avg. revenue for women-owned businesses: $153,161
  • Women-owned businesses per 100 people: 3.48
  • Women’s median annual income: $57,377
  • Women’s annual income as a percent of men’s income: 80%
  • Unemployment rate: 7.9%
  • SBA-guaranteed loans per 100,000 residents: 11.74
  • Average SBA-guaranteed loan: $1.65 million

No. 3: Denver-Aurora-Lakewood, CO

  • Avg. revenue for women-owned businesses: $170,068
  • Women-owned businesses per 100 people: 3.22
  • Women’s median annual income: $45,543
  • Women’s annual income as a percent of men’s income: 87%
  • Unemployment rate: 4.7%
  • SBA-guaranteed loans per 100,000 residents: 24.43
  • Average SBA-guaranteed loan: $255,120

No. 4: Santa Cruz-Watsonville, CA

  • Avg. revenue for women-owned businesses: $138,676
  • Women-owned businesses per 100 people: 3.95
  • Women’s median annual income: $47,412
  • Women’s annual income as a percent of men’s income: 87%
  • Unemployment rate: 6.4%
  • SBA-guaranteed loans per 100,000 residents: 15.82
  • Average SBA-guaranteed loan: $806,714

No. 5: Santa Rosa, CA

  • Avg. revenue for women-owned businesses: $115,113
  • Women-owned businesses per 100 people: 3.43
  • Women’s median annual income: $46,681
  • Women’s annual income as a percent of men’s income: 89%
  • Unemployment rate: 7%
  • SBA-guaranteed loans per 100,000 residents: 21.59
  • Average SBA-guaranteed loan: $445,480

No. 6: San Luis Obispo-Paso Robles-Arroyo Grande, CA

  • Avg. revenue for women-owned businesses: $109,853
  • Women-owned businesses per 100 people: 3.16
  • Women’s median annual income: $40,698
  • Women’s annual income as a percent of men’s income: 72%
  • Unemployment rate: 5.7%
  • SBA-guaranteed loans per 100,000 residents: 37.26
  • Average SBA-guaranteed loan: $207,772

No. 7: San Francisco-Oakland-Hayward, CA

  • Avg. revenue for women-owned businesses: $161,374
  • Women-owned businesses per 100 people: 3.41
  • Women’s median annual income: $56,381
  • Women’s annual income as a percent of men’s income: 83%
  • Unemployment rate: 6.4%
  • SBA-guaranteed loans per 100,000 residents: 15.72
  • Average SBA-guaranteed loan: $538,106

No. 8: Minneapolis-St. Paul-Bloomington, MN-WI

  • Avg. revenue for women-owned businesses: $155,950
  • Women-owned businesses per 100 people: 2.82
  • Women’s median annual income: $46,895
  • Women’s annual income as a percent of men’s income: 84%
  • Unemployment rate: 4.8%
  • SBA-guaranteed loans per 100,000 residents: 26.49
  • Average SBA-guaranteed loan: $274,713

No. 9: Portland-South Portland, ME

  • Avg. revenue for women-owned businesses: $92,241
  • Women-owned businesses per 100 people: 3.42
  • Women’s median annual income: $40,635
  • Women’s annual income as a percent of men’s income: 80%
  • Unemployment rate: 4.7%
  • SBA-guaranteed loans per 100,000 residents: 21.58
  • Average SBA-guaranteed loan: $416,118

No. 10: Fort Collins, CO

  • Avg. revenue for women-owned businesses: $100,198
  • Women-owned businesses per 100 people: 3.58
  • Women’s median annual income: $37,795
  • Women’s annual income as a percent of men’s income: 78%
  • Unemployment rate: 5.6%
  • SBA-guaranteed loans per 100,000 residents: 27.77
  • Average SBA-guaranteed loan: $204,374

Key takeaways

Wherever small-business owners decide to set up shop, they should be prepared to hustle.

“Network like crazy, join local business organizations, volunteer for local charitable endeavors, too,” Julie says. She suggests chatting with owners of local complementary businesses to set up potential collaborations and partnerships.

Seek sisters-in-arms.

 

Women business owners should seek out camaraderie in their area, too. “Starting a business can be a lonely pursuit at times, so if you can find some sisters-in-arms to serve as support and a sounding board, you will be much more likely to succeed and to be happier in doing so,” Julie says.

Of course, entrepreneurs must also be prepared to create a business plan, choose a structure for the company and find funding. Small-business loans can enable entrepreneurs to hire skilled employees, buy equipment and otherwise get the their companies off the ground.

While the gender gap persists in entrepreneurship, the number of women-owned firms is growing. In fact, that number increased 74 percent from 1997 to 2015, which is 1.5 times the rate of the national average (51 percent) for new businesses overall, according to a 2015 report by American Express OPEN and Womenable.

Will women have better odds of success by starting a business in one of these metro areas? There’s no clear answer, but at least they’ll be in good company.

Methodology

Nerd Wallet Women Entrepreneurs StudyNerdWallet analyzed U.S. Census Bureau data of 174 metro areas with populations of 250,000 or more. Eleven metro areas were excluded from the study because they lacked business or loan data.

To determine each location’s overall score, NerdWallet looked at three factors:

Business climate (45 percent)

This is based on data from the U.S. Census Bureau’s Survey of Business Owners and includes the revenue of women-owned businesses, the percentage of women-owned businesses with paid employees, and the proportion of women-owned business per 100 residents.

Financing opportunities (30 percent)

This is based on data from the Small Business Administration and the U.S. Census Bureau’s American Community Survey. The metrics include the number of SBA loans guaranteed per 1,000 residents, as well as the average amount of the loans.

Local economic health (25%)

This is based on data from the American Community Survey and considers the income of women in the metro area, their income compared with men, and the unemployment rate.

Laura McMullen
Laura McMullen is a staff writer for NerdWallet, your go-to resource for making smart financial decisions. Whether you’re looking to start or grow your small business, we’ll get you to the best answer faster. Our expert, honest and personalized tools and advice do the hard work for you — saving you time and money, and giving you the freedom to do more.