Best States in the US to start a business

Texas continues to earn high marks for its welcoming atmosphere for businesses that call it home.

The Lone Star State had three cities — Dallas-Ft. Worth, Austin and San Antonio — rank among the top four friendliest for small businesses in a new poll by Thumbtack.com and the Ewing Marion Kauffman Foundation.

For the eighth year in a row, CEOs rated Texas as the top state for businesses, according to Chief Executive magazine’s annual Best & Worst States Survey.

Rankings were compiled based on a number of factors, including regulations, tax policies, workforce quality, educational resources, quality of living and infrastructure.

Overall, Texas earned an A-plus in the poll, which graded cities and states on a number of factors, including ease of starting a business, hiring costs, government regulations and training programs.

The ranking comes after last week's Best & Worst States Survey by Chief Executive Magazine, which gave Texas the top spot for its business climate.

Idaho, Oklahoma and Utah also landed A-plus grades in the Thumbtack poll for their friendliness toward small businesses, earning high marks for things like low tax rates and other perks.

Florida ranked second in the survey, with North Carolina, Tennessee and Indiana rounding out the top five.

"Although Texas and Idaho clearly come out on top as the nation's friendliest states towards small business, entrepreneurs value a lot more than just low tax rates," said Sander Daniels, co-founder of Thumbtack.com. "Easy-to-understand licensing regulations and well-publicized training programs are critical tools necessary to support small business."

On the flip side, CEOs rated California as the worst state for business due to its high state taxes and overly stringent regulations, which is driving investment, companies and jobs to other states. According to Spectrum Locations Consultants, 254 California companies moved at least some of their work and jobs out of state in 2011 – five times as many as in 2009 and a 26 percent increase from last year.

California was home to the bottom three cities — Los Angeles, San Diego and Sacramento — according to the study.

Small business owners also gave Hawaii, Vermont and Rhode Island an F, while New York, Massachusetts, Connecticut and Michigan each scored a D.

The research was based on surveys of more than 6,000 small businesses & 650 CEOs across the United States.