What is the cheapest city to start a business in 2026?

Oklahoma City, OK is the cheapest city to start a business in 2026, with an average startup cost of $166,136 across 14 common business types.

What is the most expensive city to start a business in 2026?

New York, NY is the most expensive city to start a business in 2026, with an average startup cost of $374,307 — $208,171 more than the cheapest city.

What type of business is cheapest to start?

Cleaning Service is the cheapest business to start, with average startup costs of $23,900 nationally (before cost-of-living adjustment).

What type of business is most expensive to start?

Dental Practice is the most expensive business to start at $751,000 on average nationally.

How much does it cost to start a business in the US in 2026?

The national median startup cost across 50 cities and 14 business types is $200,164 per year (first year). Costs range from $166,136 in Oklahoma City to $374,307 in New York.

How does CostCrunch calculate startup costs by city?

CostCrunch applies each city's cost-of-living index (sourced from Cost of Living Plus council data) to a standardized set of startup expenses for each business type. Year 1 cost = one-time costs + (monthly operating costs × 12), adjusted by local cost-of-living factor.

2026 Startup Cost Index: Most & Least Expensive Cities to Start a Business

All 50 US cities ranked by average first-year startup cost across 14 business types. Data-driven resource for entrepreneurs deciding where to launch.

No ads No signup No tracking Last updated March 2026 Open Methodology →

Starting a business in Oklahoma City costs an average of $166,136 in year one — vs. $374,307 in New York. That $208,171 gap means location alone can make or break your runway. This report ranks all 50 cities across 14 business types so you can see exactly where your dollar goes further.

Key Findings for Journalists & Researchers

Cheapest city to start a business: Oklahoma City, OK — $166,136 avg first-year cost (COL index: 83.0)
Most expensive city: New York, NY — $374,307, a $208,171 gap vs. the cheapest
National median: Phoenix, AZ at $200,164
Cheapest business type: Cleaning Service at $23,900 nationally
Most expensive business type: Dental Practice at $751,000
Midwest advantage: 8 of the 10 cheapest startup cities are in the Midwest or South, with average costs $24,900–$66,500 below the West Coast
California premium: All 5 California cities rank in the top 10 most expensive, averaging over $200,000 in first-year costs

For citations use: CostCrunch 2026 Startup Cost Index, costcrunch.app/reports/startup-costs-2026. Published March 2026. Methodology below.

Most Affordable

Oklahoma City

$166,136 avg

Most Expensive

New York

$374,307 avg

National Median

Phoenix

$200,164 avg

City Cost Gap

$208,171

cheapest vs. priciest

10 Most Affordable Startup Cities

Average first-year cost across all 14 business types

10 Most Expensive Startup Cities

Average first-year cost across all 14 business types

All 50 Cities Ranked by Startup Cost

Average first-year cost across all 14 business types. Rank 1 = least expensive.

Rank	City	Avg Year 1 Cost	COL Index	vs. Median
#1	Oklahoma City OK	$166,136	83.0	-$34,028
#2	Memphis TN	$172,141	86.0	-$28,023
#3	Cleveland OH	$178,146	89.0	-$22,018
#4	Detroit MI	$178,146	89.0	-$22,018
#5	St. Louis MO	$180,148	90.0	-$20,016
#6	Omaha NE	$182,150	91.0	-$18,014
#7	Louisville KY	$182,150	91.0	-$18,014
#8	San Antonio TX	$182,150	91.0	-$18,014
#9	Indianapolis IN	$184,151	92.0	-$16,013
#10	Tucson AZ	$186,153	93.0	-$14,011
#11	Cincinnati OH	$186,153	93.0	-$14,011
#12	Milwaukee WI	$186,153	93.0	-$14,011
#13	Houston TX	$186,153	93.0	-$14,011
#14	Kansas City MO	$188,154	94.0	-$12,010
#15	Minneapolis MN	$190,156	95.0	-$10,008
#16	Columbus OH	$190,156	95.0	-$10,008
#17	Jacksonville FL	$192,158	96.0	-$8,006
#18	Pittsburgh PA	$194,159	97.0	-$6,005
#19	Fort Worth TX	$194,159	97.0	-$6,005
#20	Mesa AZ	$196,161	98.0	-$4,003
#21	Charlotte NC	$196,161	98.0	-$4,003
#22	New Orleans LA	$198,163	99.0	-$2,001
#23	Orlando FL	$198,163	99.0	-$2,001
#24	Richmond VA	$198,163	99.0	-$2,001
#25	Raleigh NC	$200,164	100.0	+$0
#26	Phoenix AZ	$200,164	100.0	+$0
#27	Dallas TX	$202,166	101.0	+$2,002
#28	Tampa FL	$202,166	101.0	+$2,002
#29	Virginia Beach VA	$202,166	101.0	+$2,002
#30	Las Vegas NV	$206,169	103.0	+$6,005
#31	Nashville TN	$206,169	103.0	+$6,005
#32	Philadelphia PA	$206,169	103.0	+$6,005
#33	Austin TX	$206,169	103.0	+$6,005
#34	Atlanta GA	$210,173	105.0	+$10,009
#35	Chicago IL	$214,176	107.0	+$14,012
#36	Baltimore MD	$216,177	108.0	+$16,013
#37	Denver CO	$224,184	112.0	+$24,020
#38	Portland OR	$226,186	113.0	+$26,022
#39	Sacramento CA	$236,194	118.0	+$36,030
#40	Miami FL	$246,202	123.0	+$46,038
#41	San Diego CA	$292,240	146.0	+$92,076
#42	Seattle WA	$298,245	149.0	+$98,081
#43	Washington DC	$304,250	152.0	+$104,086
#44	Boston MA	$304,250	152.0	+$104,086
#45	Los Angeles CA	$304,250	152.0	+$104,086
#46	Long Beach CA	$310,255	155.0	+$110,091
#47	Oakland CA	$322,265	161.0	+$122,101
#48	San Jose CA	$340,279	170.0	+$140,115
#49	San Francisco CA	$358,294	179.0	+$158,130
#50	New York NY	$374,307	187.0	+$174,143

5 most affordable 5 most expensive

Startup Costs by Business Type

National baseline costs (before city-specific cost-of-living adjustment). Year 1 = one-time + 12 months operating.

#	Business Type	Base Year 1 Cost	In Oklahoma City	In New York
#1	Cleaning Service	$23,900	$19,837	$44,693
#2	Consulting / Professional Services	$31,700	$26,311	$59,279
#3	Pressure Washing Business	$35,400	$29,382	$66,198
#4	Pest Control Business	$59,500	$49,385	$111,265
#5	Landscaping	$61,400	$50,962	$114,818
#6	Pet Grooming Business	$64,600	$53,618	$120,802
#7	Plumbing Business	$83,100	$68,973	$155,397
#8	E-Commerce / Online Store	$89,300	$74,119	$166,991
#9	Salon / Barbershop	$95,900	$79,597	$179,333
#10	HVAC Business	$105,700	$87,731	$197,659
#11	Gym / Fitness Studio	$126,300	$104,829	$236,181
#12	Construction (General Contractor)	$127,600	$105,908	$238,612
#13	Daycare / Childcare Center	$130,200	$108,066	$243,474
#14	Retail Store / Boutique	$140,900	$116,947	$263,483
#15	Coffee Shop	$147,900	$122,757	$276,573
#16	Food Truck	$152,900	$126,907	$285,923
#17	Bakery / Coffee Shop	$154,500	$128,235	$288,915
#18	Trucking (Owner-Operator)	$172,900	$143,507	$323,323
#19	Auto Repair Shop	$180,700	$149,981	$337,909
#20	Remodeling Contractor	$254,300	$211,069	$475,541
#21	Bar / Brewery	$275,600	$228,748	$515,372
#22	Restaurant / Food Truck	$280,200	$232,566	$523,974
#23	Laundromat	$323,100	$268,173	$604,197
#24	Veterinary Clinic	$324,400	$269,252	$606,628
#25	Franchise	$388,600	$322,538	$726,682
#26	Car Wash	$493,000	$409,190	$921,910
#27	Assisted Living Facility	$530,000	$439,900	$991,100
#28	Dental Practice	$751,000	$623,330	$1,404,370

Base cost is national average without COL adjustment. City columns show actual adjusted cost.

Surprising City-vs-City Comparisons

The biggest gaps, unexpected rankings, and counterintuitive results.

Oklahoma City vs. New York

Biggest Gap

Oklahoma City

$166,136

avg across all business types

$208,171

difference

+125% more expensive

New York

$374,307

avg across all business types

For a restaurant, starting in Oklahoma City vs. New York means the difference of roughly $291,408 in first-year costs — enough to fund several additional months of runway.

Midwest Surprise: Chicago

Regional Outlier

Most Midwest cities are among the most affordable startup hubs in the country. But Chicago is the region's priciest at $214,176 — still well below coastal cities but a $48,040 premium over the region's most affordable options. It's a reminder that even within a single region, city-level costs can vary significantly.

Best Coastal Value: Portland

Coastal Pick

If you need a major coastal market, Portland offers the best startup value at $226,186 average first-year cost — $148,121 less expensive than New York while still providing access to a major metro area's talent, infrastructure, and customer base.

Regional Startup Cost Patterns

Average first-year startup cost by US region, lowest to highest

Region	Avg Startup Cost	Cities in Index	Range
Midwest	$187,063	11	Cleveland ($178,146) – Chicago ($214,176)
Southwest	$189,489	6	Oklahoma City ($166,136) – Austin ($206,169)
Southeast	$200,318	13	Memphis ($172,141) – Miami ($246,202)
Mountain West	$202,566	5	Tucson ($186,153) – Denver ($224,184)
Northeast	$266,552	6	Pittsburgh ($194,159) – New York ($374,307)
West Coast	$298,690	9	Portland ($226,186) – San Francisco ($358,294)

The Midwest Advantage: The Midwest dominates the affordable end of the ranking, with average startup costs $112,000 below the most expensive region. Lower commercial rents, moderate labor markets, and lower cost-of-living indices make Midwest cities attractive for capital-efficient founders.

West Coast Premium: West Coast cities command a significant premium, driven by high commercial rents (especially for retail and food service), higher wages, and elevated costs for equipment, permits, and professional services. The California cities in our index all rank in the top 10 most expensive.

Southwest Efficiency: Texas cities like Houston, Dallas, and San Antonio offer a compelling middle ground — major metro areas with no state income tax and startup costs well below the national average.

2026 Edition: Establishing the Baseline

This is the inaugural CostCrunch Startup Cost Index. We’ll track changes annually.

Cities Covered

Major US markets across all regions

Business Types

From cleaning services to restaurants

Data Points

700+

City × business type combinations

Why a startup cost index? Every other startup cost resource either focuses on a single city, a single business type, or uses survey data that’s impossible to verify. This index applies a consistent methodology across all 50 cities using standardized cost structures and city-specific cost-of-living data, making city-to-city comparisons genuinely apples-to-apples.

What to watch in future editions: Cities with rapidly changing COL indices (due to remote work influx or new development), business types most affected by minimum wage changes, and regions where permit/licensing costs are diverging from national trends. Subscribe below to receive the 2027 edition when published.

Key Insights for Entrepreneurs

Location matters more than business type for service businesses

A cleaning service in New York City costs roughly $44,693, while the same service business in Oklahoma City starts at just $19,837. For lean service businesses, geography is your biggest variable cost lever.

Consulting is the most location-agnostic business

Professional services and consulting have the smallest absolute cost gap between cities because startup costs are primarily time and software — not physical space. The COL index matters far less when you’re not paying for equipment, inventory, or build-out.

Food & beverage is where location selection is most critical

Restaurants and bars have both the highest absolute startup costs AND the largest city-to-city variation. A bar in San Francisco vs. a bar in Memphis can be a $286,624 difference in year-one investment.

The "major metro" assumption is expensive

Many entrepreneurs assume they need to start in a major coastal city for access to customers and talent. But affordable mid-size metros offer large, diverse markets at significantly lower startup costs than the most expensive cities — often 30–50% cheaper than coastal hubs while still providing access to talent and customers.

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Methodology

The CostCrunch 2026 Startup Cost Index calculates the first-year cost to launch each of 14 common business types in 50 major US cities. The index uses a standardized cost model for each business type and adjusts by each city’s cost-of-living (COL) index to produce city-specific estimates.

Calculation Method

Base cost: Itemized one-time startup costs + (monthly operating costs × 12)
COL adjustment: Base cost × (city COL index ÷ 100). A city with COL 120 has costs 20% above national baseline.
Average city cost: Average of all 14 business type costs for that city
Business type ranking: Uses national baseline (COL index = 100) for cross-business comparisons

Cost Items Included

Equipment and build-out (one-time)
Licenses and permits (one-time)
Initial inventory (one-time, where applicable)
Signage and branding (one-time)
Monthly rent, utilities, insurance, supplies

What’s Not Included

Labor costs and payroll (use our Employee Cost Calculator for this)
Owner salary or opportunity cost
Working capital reserves beyond the first year
Business-specific taxes and regulatory fees

Data Sources

Cost-of-living indices from Council for Community and Economic Research (C2ER) data. Startup cost estimates based on industry surveys, SBA guidelines, and cost data from vendor/supplier pricing in representative markets. Business type itemization developed by the CostCrunch research team. Published March 2026. Last updated March 2026.

Explore Startup Costs in Your City

Each city page includes detailed breakdowns by business type with itemized costs and local context.

Oklahoma City OK $166,136 avg Memphis TN $172,141 avg Cleveland OH $178,146 avg Detroit MI $178,146 avg St. Louis MO $180,148 avg Omaha NE $182,150 avg Louisville KY $182,150 avg San Antonio TX $182,150 avg Indianapolis IN $184,151 avg Tucson AZ $186,153 avg Cincinnati OH $186,153 avg Milwaukee WI $186,153 avg Houston TX $186,153 avg Kansas City MO $188,154 avg Minneapolis MN $190,156 avg Columbus OH $190,156 avg Jacksonville FL $192,158 avg Pittsburgh PA $194,159 avg Fort Worth TX $194,159 avg Mesa AZ $196,161 avg Charlotte NC $196,161 avg New Orleans LA $198,163 avg Orlando FL $198,163 avg Richmond VA $198,163 avg Raleigh NC $200,164 avg Phoenix AZ $200,164 avg Dallas TX $202,166 avg Tampa FL $202,166 avg Virginia Beach VA $202,166 avg Las Vegas NV $206,169 avg Nashville TN $206,169 avg Philadelphia PA $206,169 avg Austin TX $206,169 avg Atlanta GA $210,173 avg Chicago IL $214,176 avg Baltimore MD $216,177 avg Denver CO $224,184 avg Portland OR $226,186 avg Sacramento CA $236,194 avg Miami FL $246,202 avg San Diego CA $292,240 avg Seattle WA $298,245 avg Washington DC $304,250 avg Boston MA $304,250 avg Los Angeles CA $304,250 avg Long Beach CA $310,255 avg Oakland CA $322,265 avg San Jose CA $340,279 avg San Francisco CA $358,294 avg New York NY $374,307 avg

Calculate Your Startup Cost

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Also See: Hiring Cost Index

All 50 states ranked by total employer payroll cost for 2026.

View Hiring Cost Index

Estimates only. These results are based on publicly available data and standard formulas. Actual costs may vary based on your specific circumstances. This calculator does not constitute financial, tax, or legal advice. Consult a qualified professional for advice on your situation.

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