How Do MO, KS Rate for Small Business Friendliness?

Kansas and Missouri earned middling grades in a new rating of states according to small business friendliness.

For the Small Business Friendliness Survey, Thumbtack.com and the Kauffman Foundation surveyed more than 12,000 entrepreneurs about the climate for starting and operating a small venture in their state.

The Sunflower State received a B, down from an A in 2013, because it’s harder to find employees and get a new business off the ground here, survey respondents said. On the bright side, state regulations for zoning, hiring and labor are among the “friendliest” in the nation.

Missouri, meanwhile, pulled a C—representing no change from 2013. Its environmental and zoning rules were highly rated, but the Show Me State received an F for its training and networking programs. Its rating there was one of the worst in the nation.

The study also looked at individual cities, and Kansas City didn’t perform too badly, earning a B rating, down from an A-minus in 2013. Its networking and training programs were a C-minus this year. (No individual cities in Kansas received grades this year.)

Other findings from this year’s Small Business Friendliness Study:

  • Utah, Idaho, Texas, Virginia and Louisiana received the highest “friendliness” ratings.
  • California, Rhode Island and Illinois all earned F’s.
  • Tax rates weren’t as important to business owners as red tape. States that made it easier to comply with professional licensing requirements and file their taxes were viewed as being better places to own a business.
  • If small business owners knew about government-backed training programs, they were more likely to view their state as being friendly to small business.

Jon Lieber, the chief economist at Thumbtack.com, said it was important to get direct feedback from small business owners.

“Creating a business climate that is welcoming to small, dynamic businesses is more important than ever, but rarely does anyone ask small business owners themselves about what makes for a pro-entrepreneur environment,” Lieber said.

“Thousands of small business owners across the country told us that the keys to a pro-growth environment are ease of compliance with tax and regulatory systems and helpful training programs.”