ENTREPRENEUR

noun. /ˌɒntrəprəˈnɜː(r)/ /ˌɑːntrəprəˈnɜːr/

Someone who starts their own business, especially when this involves seeing a new opportunity / by operating alone in the business world, esp. when it involves taking risks.

Top Cities For Entrepreneurial Success

A study looking at the leading cities to start a business worldwide, focusing on those that enable the new generation of entrepreneurs to develop, finance and grow their ventures into long-term success.

At Oberlo we help budding entrepreneurs in their ecommerce journey. Despite the enormous challenges of the pandemic, we’ve seen first-hand how aspiring business owners have managed to turn their economic setbacks into creative and innovative opportunities.

Whether dipping into their savings or taking advantage of the time afforded by unemployment benefits, we’re inspired by the individuals who have dug deep into their skill sets to create the business of their dreams.

Success, of course, occurs when preparation meets opportunity, so we decided to delve into the topic further by investigating the cities which offer the most supportive entrepreneurial ecosystems, as well as the frameworks to ensure long-term success.

The resulting index shows the cities best placed to provide everything an entrepreneur might need to maintain and build a business from the ground up - from bootstrapping and financing, to the logistical details that can make or break a business.

After reviewing a list of over 200 global metropolises, we shortlisted the top 75 global cities based on factors which reflected their innovation, economic strength and entrepreneurial spirit. This began by investigating the basic infrastructure and bureaucracy required to get a small business going, such as local taxes, regulatory freedom, and the average timeframe it takes in each city to start a new limited liability company. As we believe that opportunity should always be afforded on a level playing field, we also looked into the support systems available for female founders in each location.

Almost every city has offered some measure of economic support during the pandemic, with some doing more than others, so we also analysed the level of assistance available to businesses in each. Next, we looked into the specific needs of two of the most popular industries with entrepreneurs - Tech/Digital ventures and Import/Export. For the first we evaluated the local tech ecosystem, as well as the resource capital available in each city. For the second, we evaluated the local logistics ecosystem, as well as the access to global markets, and the cost of postage. Finally, we looked into the resources available for financing and bootstrapping, such as unemployment benefits, small business loans, local business taxes and venture capital.

Instructions for journalists

The list is default ranked by the final column, showing the overall suitability of a city for launching and growing a successful business, ordered from highest to lowest. Each individual column can be filtered, and the full methodology explaining how each factor was evaluated can be found underneath the table.

Infrastructure
  • Economic Freedom (Score)

  • Days to Set up an LLC

  • Female Entrepreneurs (Score)

  • Covid Support (Score)

Tech/Digital
  • Tech Ecosystem (Score)

  • Human Tech Capital (Score)

Import/Export
  • Logistics Ecosystem (Score)

  • Postage Price Deviation from Median (%)

  • Access to Global Markets (Score)

Finance & Bootstrapping
  • Unemployment Benefits (Score)

  • Small Business Loans (Score)

  • Business Taxes (Score)

  • Venture Capital (Score)

International Results

Infrastructure Tech/Digital Import/Export Finance & Bootstrapping
# City Country
Total
1 London United Kingdom 88.7 4.5 94.0 93.7 100.0 90.7 97.1 8% 94.1 88.4 96.3 93.2 100.0 100.0
2 New York USA 86.8 4.0 100.0 93.0 89.7 81.2 96.7 279% 100.0 90.5 99.4 82.8 88.7 92.3
3 San Francisco USA 86.8 4.0 99.2 93.0 88.8 74.9 95.7 394% 97.1 90.5 99.4 79.2 90.3 88.5
4 Sydney Australia 95.8 2.0 96.0 89.8 76.0 85.9 94.9 100% 90.7 92.8 99.4 85.6 72.9 87.2
5 Melbourne Australia 95.8 2.0 96.0 89.8 70.0 92.2 94.7 100% 90.7 92.8 99.4 85.6 66.3 86.6
6 Los Angeles USA 86.8 4.5 99.4 93.0 80.7 79.6 96.3 183% 97.1 90.5 99.4 79.2 77.8 86.6
7 Singapore Singapore 100.0 1.5 95.5 92.3 81.8 68.5 99.9 -55% 97.8 85.0 96.3 94.2 78.9 85.4
8 Boston USA 86.8 4.0 98.1 93.0 74.6 83.5 95.6 183% 100.0 90.5 99.4 80.6 76.7 84.8
9 Berlin Germany 86.9 8.0 92.7 95.5 77.6 71.0 97.5 -29% 98.8 93.7 95.4 85.7 76.4 83.6
10 Chicago USA 86.8 4.0 97.8 93.0 74.0 78.3 96.1 183% 100.0 90.5 99.4 77.9 72.9 82.6
11 Austin USA 86.8 4.0 97.2 93.0 75.9 74.1 95.6 183% 100.0 90.5 99.4 89.0 76.1 81.5
12 Paris France 86.2 4.0 89.9 90.7 77.3 73.5 96.2 23% 94.5 94.9 90.7 83.4 78.6 80.5
13 Seattle USA 86.8 4.0 98.2 93.0 72.4 73.9 95.6 279% 100.0 90.5 99.4 89.0 72.9 79.9
14 Auckland New Zealand 96.2 0.5 96.0 90.0 66.0 77.5 95.8 9% 89.0 91.4 100.0 87.5 63.0 78.6
15 Miami USA 86.8 4.0 96.3 93.0 70.2 73.2 96.3 647% 100.0 90.5 99.4 85.1 66.0 78.4
16 Beijing China 63.7 9.0 86.2 92.0 73.7 100.0 94.3 -53% 97.0 88.4 93.3 89.7 86.1 78.2
17 Toronto Canada 90.1 1.5 88.7 88.1 79.6 73.3 94.4 60% 91.4 89.4 97.9 62.7 78.3 78.0
18 Copenhagen Denmark 92.0 3.5 91.7 87.4 68.6 74.5 96.5 4% 94.2 96.5 95.4 91.6 69.8 77.9
19 Munich Germany 86.9 8.0 91.7 95.5 67.6 69.7 97.5 -29% 98.8 93.7 95.4 85.7 66.6 77.8
20 Tokyo Japan 84.5 11.0 78.8 96.6 81.5 77.0 97.2 22% 93.6 76.8 92.1 85.9 80.4 77.5
21 Seoul South Korea 83.1 8.0 85.6 91.4 69.3 88.5 94.7 -100% 91.2 87.9 94.4 87.9 68.3 77.2
22 Madrid Spain 90.7 12.5 90.3 89.9 72.9 71.3 94.7 12% 94.3 92.0 93.3 89.7 69.2 76.8
23 Amsterdam Netherlands 90.1 3.5 88.5 84.8 80.2 67.0 99.3 -14% 97.9 89.0 89.1 89.7 71.9 76.3
24 Hamburg Germany 86.9 8.0 89.4 95.5 66.5 65.4 98.5 -29% 98.8 93.7 95.4 85.7 64.9 75.5
25 Milan Italy 90.2 11.0 86.3 100.0 64.1 63.8 94.8 53% 93.8 93.6 89.1 87.6 63.9 74.6
26 Zurich Switzerland 93.1 10.0 90.7 84.3 70.7 66.1 96.0 -3% 95.0 97.3 94.4 92.1 72.4 74.2
27 Edinburgh United Kingdom 88.7 4.5 92.7 93.7 65.1 70.7 96.4 8% 94.1 88.4 96.3 93.2 66.6 73.8
28 Vancouver Canada 90.1 1.5 88.7 88.1 73.5 69.8 95.3 60% 91.4 88.9 97.9 57.5 73.5 73.7
29 Brussels Belgium 90.0 5.0 89.8 87.0 63.4 68.1 97.7 -32% 97.4 100.0 94.4 89.7 62.7 73.6
30 Birmingham United Kingdom 88.7 4.5 94.0 93.7 62.5 72.1 96.4 8% 94.1 88.4 96.3 93.2 62.3 73.3
31 Rome Italy 90.2 11.0 88.5 100.0 60.5 62.0 94.6 53% 93.8 93.6 89.1 87.6 60.3 72.4
32 Shanghai China 63.7 9.0 86.2 92.0 69.2 88.0 97.4 -53% 97.0 88.4 93.3 89.7 80.9 72.4
33 Barcelona Spain 90.7 12.5 91.6 89.9 72.7 56.9 94.7 12% 94.3 92.0 93.3 89.7 71.6 71.1
34 Hong Kong Hong Kong 97.0 1.5 83.3 86.9 74.0 64.5 100.0 -42% 97.7 79.2 96.3 94.4 69.0 71.0
35 Helsinki Finland 90.6 13.0 92.4 80.3 67.6 72.4 96.3 17% 93.4 93.6 93.3 92.7 70.4 70.8
36 Montreal Canada 90.1 1.5 88.7 88.1 67.2 71.4 94.4 60% 91.4 88.9 97.9 62.7 69.1 70.8
37 Cardiff United Kingdom 88.7 4.5 91.5 93.7 60.9 69.0 96.4 8% 94.1 88.4 96.3 93.2 61.1 70.7
38 Antwerp Belgium 90.0 5.0 89.8 87.0 60.4 62.2 99.7 -32% 97.4 100.0 94.4 89.7 59.7 70.5
39 Stockholm Sweden 89.8 7.5 93.7 80.7 72.8 64.9 96.1 56% 95.4 91.4 93.3 92.0 74.8 69.8
40 Belfast United Kingdom 88.7 4.5 92.5 93.7 60.1 65.7 96.4 8% 94.1 88.4 96.3 93.2 62.7 69.2
41 Florence Italy 90.2 11.0 85.4 100.0 57.5 59.0 94.6 53% 93.8 93.6 89.1 87.6 57.6 69.1
42 Vienna Austria 90.7 21.0 89.7 86.1 65.9 66.5 96.4 -49% 95.1 88.8 92.1 89.7 64.8 68.6
43 Dublin Ireland 92.0 11.0 94.3 84.0 69.3 62.9 92.1 7% 94.3 90.9 95.4 96.0 71.0 68.1
44 Tel Aviv Israel 89.6 11.0 83.2 84.2 77.5 64.7 91.3 -53% 83.2 86.4 95.4 91.0 75.9 66.7
45 Mumbai India 66.8 17.5 71.6 90.1 75.4 77.8 90.0 -61% 86.7 90.2 97.2 85.6 72.0 65.2
46 Bordeaux France 86.2 4.0 90.1 90.7 59.3 57.6 95.5 23% 94.5 94.9 90.7 83.4 60.0 64.7
47 Warsaw Poland 88.6 37.0 92.0 86.1 65.4 69.3 92.1 5% 92.7 82.1 96.3 93.2 65.3 64.6
48 Oslo Norway 85.3 4.0 93.0 76.0 68.9 64.2 94.2 518% 91.9 97.0 92.1 91.6 67.9 64.4
49 Marseille France 86.2 4.0 88.0 90.7 58.7 58.2 96.0 23% 94.5 94.9 90.7 83.4 59.1 64.4
50 Lisbon Portugal 88.9 6.5 93.1 83.3 64.0 62.1 96.6 6% 92.1 87.3 89.1 84.0 61.7 63.5
51 Tallinn Estonia 89.8 3.5 94.4 76.6 75.4 64.6 89.5 -27% 90.9 85.5 95.4 92.7 71.3 63.5
52 Bengaluru India 66.8 17.5 71.6 90.1 73.0 78.2 88.2 -61% 86.7 90.2 97.2 85.6 76.8 63.4
53 Luxembourg city Luxembourg 89.1 16.5 95.1 81.6 63.7 58.7 93.4 -43% 93.4 94.7 57.5 89.8 65.1 63.4
54 Krakow Poland 88.6 37.0 92.0 86.1 60.6 69.8 92.1 5% 92.7 82.1 96.3 93.2 60.9 62.3
55 Prague Czechia 86.4 24.5 84.6 88.4 63.5 66.2 93.8 -28% 93.8 82.3 95.4 93.2 63.6 62.2
56 Nice France 86.2 4.0 92.0 90.7 58.4 50.0 95.5 23% 94.5 94.9 90.7 83.4 58.6 61.5
57 Kuala Lumpur Malaysia 85.4 18.0 82.0 87.9 65.2 69.1 91.3 -65% 87.1 79.8 96.3 90.4 63.3 60.4
58 New Delhi India 66.8 17.5 71.6 90.1 75.6 82.5 88.2 -61% 86.7 74.0 97.2 85.6 67.9 59.9
59 Dubai UAE 79.9 4.5 84.6 78.4 73.4 59.0 97.8 -14% 93.6 85.8 95.4 100.0 69.5 59.4
60 Athens Greece 84.1 4.0 80.2 90.0 61.2 63.0 89.6 42% 88.6 85.6 89.1 90.4 60.0 58.0
61 Santiago Chile 88.4 4.0 70.8 82.2 64.3 69.6 89.7 72% 88.5 85.7 92.1 89.7 63.8 57.6
62 Jakarta Indonesia 79.1 13.0 77.9 91.8 70.2 64.3 89.1 -49% 83.0 76.5 95.4 89.7 66.8 57.4
63 Ljubljana Slovenia 87.5 8.0 84.1 85.3 61.1 62.0 89.5 22% 92.1 85.0 89.1 93.2 61.8 57.0
64 Moscow Russia 66.4 10.0 90.6 86.8 67.2 79.1 82.1 -20% 78.4 84.2 97.2 92.7 66.7 57.0
65 Budapest Hungary 87.7 7.0 85.8 86.0 64.0 61.5 91.3 -36% 91.4 78.0 96.3 97.3 63.9 56.9
66 Vilnius Lithuania 86.6 5.5 93.4 79.5 65.7 61.6 86.9 7% 87.4 85.2 95.4 95.0 64.4 56.1
67 Bucharest Romania 85.5 20.0 87.5 80.5 64.5 64.2 88.5 -60% 87.4 83.7 97.2 94.6 64.6 55.5
68 Riga Latvia 88.9 5.5 91.0 80.3 64.6 63.5 80.5 -42% 86.2 83.5 97.9 92.7 63.1 53.6
69 Sao Paulo Brazil 69.1 17.0 80.1 87.5 73.7 64.9 88.9 68% 77.5 76.9 90.7 80.6 70.7 53.4
70 Reykjavik Iceland 90.1 11.5 96.8 57.5 61.9 67.4 91.0 36% 85.6 98.5 92.1 92.7 69.0 53.1
71 Istanbul Turkey 73.7 7.0 73.0 83.5 67.4 68.2 90.1 -78% 84.6 82.6 96.3 91.6 65.9 53.0
72 Zagreb Croatia 86.8 19.5 79.8 80.2 62.6 63.5 87.7 -31% 87.3 82.0 90.7 93.7 61.8 52.0
73 Lima Peru 92.1 26.0 94.5 87.6 60.8 59.2 78.5 -61% 79.2 76.7 96.3 86.1 59.9 51.6
74 Bratislava Slovakia 85.0 21.5 90.4 77.7 61.5 62.5 85.6 -18% 89.6 82.9 95.4 92.2 62.2 50.9
75 Sofia Bulgaria 89.0 23.0 82.2 78.7 63.6 61.3 84.7 -81% 88.7 79.5 94.4 97.0 62.0 50.0

METHODOLOGY

The Top Cities For Entrepreneurial Success ranking reveals the cities with the most supportive ecosystems for successful business around the world. The study compares and analyzes 13 factors that contribute to entrepreneurial success.

An original list of 200 capitals and major business centers from around the world were reviewed and ranked according to these 13 factors, from which a final list of the top 75 cities was determined based on the total scores and comparable data availability.

Factors & Scoring

The study was divided into four categories - Infrastructure, Tech/Digital, Import/Export, Finance & Bootstrapping - comprising of the following factors:

Infrastructure
  • Economic Freedom (Score)

  • Days to Set up an LLC

  • Female Entrepreneurs (Score)

  • Covid Support (Score)

Tech/Digital
  • Tech Ecosystem (Score)

  • Human Tech Capital (Score)

Import/Export
  • Logistics Ecosystem (Score)

  • Postage Price Deviation from Median (%)

  • Access to Global Markets (Score)

Finance & Bootstrapping
  • Unemployment Benefits (Score)

  • Small Business Loans (Score)

  • Business Taxes (Score)

  • Venture Capital (Score)

Each factor consists of one or more indicators which were scored and averaged. The equation for scoring is as follows:

z-Score = x - mean(X)Standard deviation(X)in short x - μσ

For columns where a low value is better, the score is inverted such that a high score is always better:

z-Scoreinverted = -1*x - mean(X)Standard deviation(X) in short -1 *x - μσ
Data is normalized to a [50-100] scale, with 100 being the best score. Therefore, the higher the score, the better the city/country ranks for that factor in comparison to the other cities in the index. The formula used is min-max normalisation:
score = (100-50) *x - min(X)max(X) - min(X)+50

The final score was determined by calculating the sum of the weighted average score of all of the indicators. Below you can find a detailed description of each factor within the study, and the source used.

Economic Freedom (Score)

This factor reflects the regulatory environment relevant to doing business in each country. The score uses the following components from the Economic Freedom Index:

Monetary Freedom: a measure of inflation combined with an assessment of various government activities that distort price according to the Heritage Foundation.

Trade Freedom: a composite measure of the extent of tariff and nontariff barriers that affect imports and exports of goods and services.

Investment Freedom: an evaluation of a variety of regulatory restrictions that typically are imposed on investment.

Source: The Heritage Foundation.

Days to Set up an LLC

The number of days required to incorporate a business in the most common limited liability form.

This data captures the median duration that incorporation lawyers or notaries indicate is necessary in practice to complete a procedure with minimum follow-up with government agencies and no unofficial payments. It is assumed that the minimum time required for each procedure is one day, except for procedures that can be fully completed online, for which the minimum time required is recorded as half a day.

All data points are national-level, except for US cities where the data is state-level.

Source: The World Bank Doing Business 2020.

Female Entrepreneurs (Score)

This combined score reflects how easy it is for a female entrepreneur to set up a business in each of the countries. It consists of the following indicators:

Share of companies with female ownership and founders.
Gender-specific limitations on ownership rights and access to financial resources.

Sources: World Bank; OECD; Crunchbase; Mastercard Index of Women Entrepreneurs 2020 (MIWE).

Covid Support (Score)

This score reflects the level of government response to the Covid-19 pandemic in terms of economic support for businesses. It consists of the following indicators:

Number of SME-support measures in response to covid-19 by governments
Additional spending or foregone revenues (in % of gdp).
Liquidity support e.g. equity injections, loans, asset purchase or debt assumptions (in % of gdp).
Country-level data.

Sources: World Bank Group - Map of SME-Support Measures (2021); IMF Fiscal Monitor Database of Country Fiscal Measures in Response to the COVID-19 Pandemic (2021).

Tech Ecosystem (Score)

The presence of a healthy tech startup scene, as measured by the rate of new startups. The score takes into account:

The absolute number of startups formed since 2010.
The number of startups formed since 2010 expressed as a percentage of city population.

Source: Crunchbase.

Human Tech Capital (Score)

This score analyses the environment for tech companies by looking at the education of students in the Information and Communication sector. It takes into account the following indicators:

Number of Information and Communication graduates.
Number of Information and Communication graduates per 100,000 inhabitants.
Country-level data.

Sources: Education at a glance (2020); Unesco - National Monitoring; Local Administrations.

Logistics Ecosystem (Score)

The presence of logistics infrastructure to support an international trading business. The score takes into account the following indicators:

Four components from the World Bank’s logistics performance index: ability to track and trace consignments; competence and quality of logistics services; frequency with which shipments reach consignee within scheduled or expected time; and quality of trade and transport-related infrastructure. The presence of major ports and cargo airports.

Source: World Bank “Logistics Performance Index”; Cargo Facts 2020.

Postage Price Index

The general price level of local postal service in each country expressed as a deviation from the median price. The factor takes into account the following:
Price for an express parcel delivery from the city to another main city in the same country (either capital or second biggest city).
Parcel profile: 46x32x10 cm, 2kg, next day (end of day) delivery. If that option wasn’t available in the tariffs the next available option closest to the profile was chosen.
Each individual delivery cost is compared to the median of all delivery costs. A value above zero means that the postal price in this city is higher than the midpoint of the dataset, whereas a value below zero means that it is cheaper to send a package compared to the midpoint of all delivery costs.

Source: Local Postal services.

Access to Global Markets (Score)

This score looks at the business environment regarding the possibilities to exchange goods and services with other markets. It takes into account the following indicators:

Two components from the World Bank’s logistics performance index: ease of arranging competitively priced international shipments, and efficiency of the clearance process.
Merchandise imports (current US$).
Merchandise exports (current US$).
Number of Free Trade Agreements.
Efficiency of the clearance process (i.e. speed, simplicity and predictability of formalities) by border control agencies, including customs.
Ease of arranging competitively priced shipments.

Sources: Word Bank (2019); WTO (2021); World Bank - Logistics Performance Index (2018).

Unemployment Benefits (Score)

This score reflects the typical length of social benefits in case of unemployment received as well as the actual wage level. It consists of the following indicators:

Duration of unemployment benefits. Profile: 30 year old single; no children; work prior to unemployment; five years of contribution; average salary, full-time; contract terminated because of shortage of work.
Mean nominal monthly earnings.
Country-level data.

Sources: OECD Benefits and wages (2020); International Social Security Association (2018); European Commission - Your social security rights (2020); ILO - Mean nominal monthly earnings of employees (2016-2020); local governmental websites.

Small Business Loans (Score)

A comparison of private credit markets analysing legal rights and credit information. It consists of the following indicator:

Getting Credit total score (DB15-20 methodology).

Source: The World Bank Doing Business 2020.

Business Taxes (Score)

The score reflects the national tax on company income, plus state, provincial or municipal corporate income taxes. Sales-based taxes are not included.

Source: The Tax Foundation.

Venture Capital (Score)

The number of startups receiving funding as a measure of the financing ecosystem. The score takes into account:

The absolute number of startups formed since 2010 that have received funding since 2015.
The absolute number of startups formed since 2010 that have received funding since 2015, expressed as a percentage of city population.
The absolute number of startups formed since 2010 that have received funding since 2015, expressed as a percentage of startups formed since 2010.

Source: Crunchbase.