Atlanta has emerged as the top city for starting a new business, according to recent data from LinkedIn. The Southern metropolis saw a 92% year-over-year increase in residents founding their own companies, the highest growth rate among major U.S. cities.
Experts say Atlanta’s post-pandemic job market recovery and influx of new residents have created ideal conditions for entrepreneurs. The city’s business-friendly environment, anchored by corporate heavyweights like Coca-Cola and Delta Air Lines, is also attracting newcomers looking to launch startups.
“Atlanta and Austin are both seeing a lot of inward migration, as people in all kinds of professions decide that these are the Grade-A destinations in terms of finding success for their careers, families and work-life prospects,” said George Anders, LinkedIn’s senior editor at large.
Anders noted that these new residents offer a promising customer base for fledgling businesses. “They don’t have favorite restaurants or stores yet, so they’re more willing to try yours,” he said. “They also need help buying homes, choosing schools, finding contractors and a whole lot more. So that translates into a very promising customer base that new entrepreneurs can tap into.”
Atlanta’s 92% growth in new business founders over the past year far outpaced the second-place city on LinkedIn’s list, Austin, Texas, which saw an 84% increase. Seattle ranked third with 75% growth, followed by San Francisco, Chicago, Boston, Miami, New York City, Los Angeles and Denver rounding out the top 10.
The LinkedIn data tracks with a recent report from Babson College and the Global Entrepreneurship Monitor, which found that entrepreneurship in the U.S. is at its highest level since tracking began in 1999. Nearly 1 in 5 American adults is currently starting a business or has done so in the past 3.5 years.
“We’re seeing an upward trend in entrepreneurship that’s continued through the pandemic, and that’s a really great sign,” said Donna Kelley, a Babson professor and the report’s lead author. “It means businesses are introducing innovation, creating jobs and contributing to the competitiveness of the United States.”
What’s Driving Atlanta’s Entrepreneurial Boom?
Atlanta’s emergence as the top startup hub reflects several underlying economic trends. As one of the first major cities to bounce back from pandemic shutdowns, Atlanta has seen an influx of new residents from more expensive coastal cities.
Fox 5 Atlanta reported the metro area is growing “at a breakneck pace” thanks to its vigorous post-COVID job recovery. Atlanta ranked No. 1 on a recent Wallethub analysis of the best cities for young professionals to start their careers, based on metrics like job availability, cost of living and median income.
Atlanta also benefits from a business-friendly environment and low taxes. The city lies in sharp contrast to the high costs and regulations of the San Francisco Bay Area, the traditional heart of American startup culture.
While San Francisco still claimed the No. 4 spot for growth in new founders, LinkedIn’s Anders speculated that “smaller ‘Main Street’ businesses aren’t opening at a nation-leading pace” there compared to cities like Atlanta and Austin.
Atlanta’s existing corporate giants are also an asset for startups, providing a deep talent pool, mentorship and potential customers. Homegrown firms like UPS, Home Depot and First Data have helped cement Atlanta’s reputation as a hub for logistics, e-commerce and financial technology.
“When you have large companies generations deep like we have here in Atlanta, it creates an environment where there’s so much experience to be shared,” said Tiffany Farr, president of the Atlanta chamber’s Innovation and Entrepreneurship Division, in an interview with the Atlanta Business Chronicle. “There’s great talent you can pull from.”
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Startups Flourishing in Hotbeds Like Austin and Miami
LinkedIn’s top 10 highlights two other emerging hotspots for startups: Austin and Miami. Both cities have enjoyed massive influxes of new residents during the pandemic, drawn by warm weather, lower costs of living and an openness to remote work.
Austin’s 84% one-year growth in new founders reflects the Texas capital’s growing reputation as “Silicon Hills.” The city’s tech sector has swelled in recent years, with Tesla, Oracle and Samsung establishing large presences there.
Meanwhile, the Miami metro area saw a 95% increase in tech job listings between 2019 and 2021, according to a report from real estate firm Cushman & Wakefield. The region’s startup scene is buoyed by transplants from Northeast cities, a highly diverse population and lack of state income tax.
“Everywhere from Miami to Indianapolis stands to gain as entrepreneurship spreads more widely through America,” LinkedIn’s Anders said. “The more vibrant the local economy, the better the opportunities for everyone.”
The LinkedIn data shows entrepreneurship expanding beyond traditional coastal tech hubs as remote work and record-low mortgage rates unleash new possibilities. Anders believes these trends are giving rise to “Main Street entrepreneurship” centered on local professional services, restaurants, nail salons and more.
For those looking to tap into their city’s entrepreneurial momentum, experts recommend researching the local market, connecting with mentors and leveraging available support like Small Business Administration loans or training programs. With the economy still unsettled, launching a startup entails risk, but for many, the potential rewards are worth it.