Sioux Falls Best Business-Beginning Burg

The Sioux Falls Development Foundation sat on $91,000 of its city subsidy last year, and Sioux Falls still came out #1 in WalletHub’s ranking of the Best Large Cities to Start a Business:

WalletHub looked at the 150 largest cities in the U.S.—by Wikipedia’s data, Sioux Falls just makes that cut at 147. We thus don’t get to compare Sioux Falls with in-state rivals. But the only other city in a neighboring state to make the top 10 is Lincoln, Nebraska:

Overall Rank	City	Total Score	Business EnvironmentRank	Access to Resources Rank	Costs Rank
1	Sioux Falls, SD	52.65	9	55	12
2	Grand Rapids, MI	52.52	16	43	13
3	Oklahoma City, OK	52.22	7	81	18
4	Lincoln, NE	52.03	34	4	66
5	St. Louis, MO	51.81	55	11	7
6	Salt Lake City, UT	51.07	98	3	26
7	Charlotte, NC	50.85	6	60	48
8	Springfield, MO	50.77	90	38	1
9	Tulsa, OK	50.69	66	21	4
10	Amarillo, TX	49.7	18	31	76

Regionally, Omaha ranks 19th, Minneapolis 40th, Des Moines 60th, and St. Paul 105th.

WalletHub weighs these 16 metrics in its scoring for new-business suitability:

Business Environment – Total Points: 50

• Length of Average Work Week: Full Weight (~8.33 Points)
• Average Growth of Number of Small Businesses: Full Weight (~8.33 Points)
• Number of Startups per 100,000 Residents: Full Weight (~8.33 Points)
• Average Growth of Business Revenues: Full Weight (~8.33 Points)
• Five-Year Business-Survival Rate: Full* Weight (~8.33 Points)
• Industry Variety: Full Weight (~8.33 Points)

Access to Resources – Total Points: 25

• Financing Accessibility: Full Weight (~4.17 Points)
  Note: This metric was calculated by dividing the “total annual value of small-business loans” by the “total number of small businesses.”
• Venture Investment (amount) per Capita: Full Weight (~4.17 Points)
• Prevalence of Investors: Full Weight (~4.17 Points)
• Human-Capital Availability: Full Weight (~4.17 Points)
  Note: This metric was calculated by subtracting the “unemployment rate” by the “number of job openings per number of population in labor force.”
• Higher Education Assets (Average University Score & Number of Students Enrolled per Capita): Full Weight (~4.17 Points)
• College-Educated Workforce: Full Weight (~4.17 Points)
  Note: This metric measures the percentage of the population holding at least a bachelor’s degree.

Costs – Total Points: 25

• Office-Space Affordability: Full Weight (~6.25 Points)
  Note: This metric measures the per-square-foot cost of commercial office space.
• Labor Costs: Full Weight (~6.25 Points)
  Note: This metric measures the median annual income of the city.
• Corporate Taxes: Full* Weight (~6.25 Points)
• Cost of Living: Full Weight (~6.25 Points) [John S. Kiernan, “2016’s Best Large Cities to Start a Business,” WalletHub, downloaded 2016.05.05]

Note that labor costs are part of the calculation. Cheaper labor means a better ranking… meaning a low-wage city like Sioux Falls where nearly half the kids qualify for free or reduced-price school lunches is a great place for the entrepreneurial class to launch its dreams.