The core American idea of transforming yourself into a business owner and holding the power of your professional destiny in your hands is currently closely linked to digital assets and access. With more people registering for business across the US, Hostinger conducted a study to discover what’s driving this trend. We found that states like California, New Jersey, and New York stand out for their strong online and entrepreneurial spirit.
A key indicator of this trend is the correlation between the creation of new businesses and websites. However, when examining small businesses by size (grouped by the number of employees), the correlation is more present with solopreneurs (one-person companies) than with small businesses with more than one employee.
We developed a ranking system based on a custom variable: the Digital SB Score. In each state, it considers:
- the number of websites created using Hostinger between July and December of 2024
- the percentage of the state’s population employed by small businesses
- the total number of small businesses
- the percentage of solopreneurs
The main purpose of this composite variable is to find connections between digital entrepreneurship and starting a business – a small-scale one, in particular.
In a very competitive marketing era, companies are trying to tackle emerging technologies, online presence, software development, or customer interaction through new digital ideas.
Top 10: A mix of big and small states
The following map shows each state’s Digital SB Score:
California, New York, Texas, and Florida occupy the first 10 places. They share two main characteristics: each has more than 105 small businesses (SB) per 1,000 people, and websites created with Hostinger ranged between 16,000 and 35,000 during the second half of 2024.
The remaining top 10—New Jersey, Washington, Oregon, Virginia, Maryland, and Colorado—earned their spots for different reasons:
- New Jersey – more than 7,000 websites were created (during the second half of 2024), and 103 SBs per 1,000 people were launched.
- Washington – rapidly increasing website creation rate (over 7,000 between July and December 2024).
- Oregon – a high percentage of the workforce in small businesses (58%).
- Virginia – a large number of small businesses (over 850,000) and a high website creation rate.
- Maryland: – one of the highest rates of solopreneurs (83% of the state’s small businesses).
- Colorado – more than 750,000 small businesses in a relatively small population, making it one of the most entrepreneurial states (120 small businesses per 1,000 residents).
States at the bottom
The bottom ten states based on Hostinger customer variables are: Delaware, South Dakota, Vermont, South Carolina, North Dakota, Iowa, Alaska, Mississippi, Kentucky, and West Virginia.
- Seven of these have less than 100 small businesses per 1,000 people. Vermont, Alaska, and South Carolina are the only ones that surpass that.
- Six states – West Virginia, Kentucky, Iowa, Mississippi, South Carolina, and Delaware – have a registered population working for small businesses below 49%.
- One common characteristic is their low website creation rate, compared to the first ten states, during the second half of 2024 (below 2,000).
Hotspots for digital and small business growth
California
The Golden State is the top-ranking one for website creation with Hostinger services: more than 35,000, between July and December 2024. It is the biggest economy in the U.S. (GDP of nearly $3.9 trillion in 2023), and small businesses thrive in mostly in cities like Los Angeles, San Francisco, or San Jose (where Silicon Valley resides). 4.2M small-size businesses grow here. It’s the highest number among all states and is equal to the total sum of SBs created in the 19 lowest-ranking states, according to the Digital SB Score.
Montana
The breathtaking landscapes of Montana seem to be inspiring thousands of workers. No other U.S. state has 66% of its population employed by small businesses. This statistic alone describes the economy of a state where entrepreneurship is well rooted (120 SBs per 1,000 people), and digital spirit will likely persist in the following years (around 1,000 websites developed in the second half of 2024).
Florida
The electrifying dynamic in Florida is well exemplified by the fact that 92% of small businesses are solopreneurs. There is no other state with such a big community. The southern state knows about new businesses and digital tools. Low taxes, a super-connected hub, and a big tourism industry stand out as the main reasons.
Special mention: Wyoming
For the special mention, we have considered each state’s population size. Wyoming has the highest rate of small businesses per 1,000 people: 132. Job opportunities in the Cowboy State obviously rely on small businesses. Similarly to Montana, 65% of its population works for this type of company.
Who’s in the middle of the ranking?
Outside the first and last places cited before, big population states like Georgia, Ohio, Illinois, and Massachusetts share:
- A rising volume of websites, between 5,000 and 9,000
- A high number of small businesses, between 750,000 and 1.3M
- The percentage of each state’s workforce employed by SBs is around 43%
- More than 7M residents (all considered big economic states)
All of them appear near the average ranking proposed by the online platform.
What are small businesses building in each state?
A closer look at the top-ranking states reveals key industry patterns:
- Professional, Scientific, and Technical Services: among top three industries, emphasizing the role of a strong commercial and academic environment in small business success.
- Transportation and Warehousing: crucial industries in the top 15 states, reflecting the importance of commerce and supply chain distribution.
- Real Estate and Construction: significant contributors to small business ecosystems, particularly within the Other Services category, representing at least 10% of small business activity.
These three business fields dominate the small business landscape throughout the US.
Among the 20 industries included in the analysis, the Other Services category represents multiple sectors. Small businesses in this category account for at least 10% of the national share. In some states, such as Mississippi, Alabama, Georgia, Arkansas, Tennessee, Louisiana, and South Carolina, it accounts for over 11% of small-size companies.
Growing Small Business Sectors
The small business economy is based on diversity, but data shows that it is concentrated in the four big categories mentioned above. Growing industries, with a 5% average of each state share, include:
- Construction
- Agriculture, Forestry, Fishing and Hunting
- Administrative, Support, and Waste Management
- Retail Trade
- Health Care and Social Assistance
- Arts, Entertainment, and Recreation
- Educational Services
Industries that appear to be stalled or are not on small business owners’ radar include: Finance and Insurance; Mining, Quarrying, and Oil and Gas Extraction, as well as Management of Companies and Enterprises, among others.
The surge of small businesses and the future
According to the Department of the Treasury, small businesses and entrepreneurship have grown since the Covid-19 pandemic. This growth is driven by factors such as job creation, eased credit standards, and decreasing inflation.
The National Federation of Independent Business Index presents an exponential increase in optimism from July 2024 to January 2025. Additionally, new business applications have surged since the pandemic, with more than 400K requests per month.
However, economic and political challenges could hinder these trends. In January 2025, the new business applications trend saw a 14% decline, with registrations dropping to 392,000.
What is the website creation rate telling us?
The number of websites created in the U.S. with Hostinger Website Builder during the second half of 2024 surpassed 250K.
Hostinger’s study started with the hypothesis that states with more small businesses also have a higher website creation rate. While this turns out to be true for solopreneurs, the trend disappears with companies that employ one or more people.
Today, websites have become essential to building new businesses because of the opportunity to reach new markets and provide valuable online services to potential customers. Even manual industries like construction or transportation have clear uses for online tools, like internal resources or the promotion of services.
The possibilities of taking your idea online are now endless. New small businesses can now develop their own online solutions, no matter how traditional the industry is. As the study and the ranking show, online presence is essential for small companies to thrive in their market.
Methodology
- The custom variable takes into account the number of websites created in each state, the state’s population employed by small businesses, the number of active small businesses in each state, and the rate of small businesses without employees (solopreneurs).
- The number of websites created corresponds to Hostinger Website Builder site creation rate in the US from July to December 2024.
- Small Business data was gathered from the US Small Business Administration.
Sources:
- US Small Business Administration
- Department of the Treasury
- National Federation of Independent Business Index
- US Census
Ricardo is a data journalist and visualization expert with over seven years of experience uncovering insights through data storytelling. His work focuses on data exploration, geospatial analysis, and interactive visualizations, helping audiences understand complex information through compelling narratives. His projects have been featured in Statista,
Forbes,
La Nación, among others.
When he’s not analyzing datasets, Ricardo enjoys brewing specialty coffee, watching sports, and reading fiction. Follow him on LinkedIn or check his Portfolio to see his latest work.