SAN FRANCISCO (KRON) — San Francisco is the best city in the country to start a small business in, according to a new study. The study, published by automated gifting service, Client Giant, based its rankings on the number of small businesses in a city, the city’s economic growth and small business incentives from local government.

San Francisco is best city for starting small business

The City by the Bay topped the list based on factors including late SF Mayor Ed Lee earmarking funds supporting small business growth in 2017, an online portal established by local government offering resources for entrepreneurs. The study also mentioned that SF currently has over 120,000 small businesses within city limits.

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While small businesses in San Francisco and elsewhere have struggled since the onset of the COVID-19 pandemic in 2020, the city still tops the list as a place for business entrepreneurs to turn their ideas into reality, the study said. San Francisco’s favorable weather and colorful cultural climate were also mentioned as reasons why the city was a good place to start a small business.

“With local government support and community engagement with small businesses, San Francisco is a fantastic place for startups, shops, and making any other entrepreneurial dream a reality,” said the study’s author Savannah Admire in a statement provided to KRON4.

San Jose ranks in top 5 cities for starting a small business

San Jose also ranks in the top 5 of best cities to start a small business in, according to the study. The South Bay city is ranked fourth with its close proximity to the tech industry cited as one of the factors that make it favorable to small business. Despite its high cost of living, San Jose’s thriving economy means it’s a good place for entrepreneurs to grow their ideas, whether they be tech startups, coffee shops of book stores.

According to the study’s author, San Jose’s proximity to tech is a big part of what makes it such a favorable environment for small business.

“San Jose is surrounded by the powerhouses of the tech industry, creating a growing economy with plenty of room for local small businesses and a perfect place for individuals to stretch their entrepreneurial muscles,” Admire said.

The top 10 cities for starting a small business in

The complete list of the 10 best cities to start a small business in the U.S. is as follows:

  1. San Francisco, California
  2. Austin, Texas
  3. Minneapolis, Minnesota
  4. San Jose, California
  5. Columbus, Ohio
  6. Nashville, Tennessee
  7. Seattle, Washington
  8. Boston, Massachusetts
  9. Portland, Oregon
  10. Denver Colorado