The Shift: NWA startups surge past U.S. average
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Northwest Arkansas' startup scene is trending in the right direction, according to a report of key statistics.
Why it matters: Entrepreneurship fuels regional resilience and job creation — diversifying Northwest Arkansas' economy beyond a few Fortune 500 anchors, while expanding its talent pipeline, capital access and future industry base.
State of play: The report, published Aug. 13 by the Walton Family Foundation (WFF), compares the area with Austin, Texas; Des Moines, Iowa; Durham and Raleigh, North Carolina; Madison, Wisconsin; and Provo, Utah.
- It used the most recent data from the Census Bureau and the Bureau of Labor Statistics.
Context: WFF began a direct effort to grow NWA's entrepreneurialism in 2018 and hired Yee-Lin Lai, a senior program officer, to lead it, she told me.
- The resulting plan identified gaps in capital and market access, and technical assistance.
- "We were very intentional on bringing initiatives to help bridge this gap," she told me.
Winners: Startups represented 37% of NWA businesses in 2021, also higher than state and U.S. averages.
- Companies less than five years old grew nearly 7% here in 2021, outpacing all comparisons except Provo.
- The total number of businesses in Northwest Arkansas grew 4.2% in 2023, higher than statewide and U.S. averages.
Losers: NWA's business ownership rate in 2023 was 5.7%, up from 2018 but still below some others (U.S. at 6% and Madison at 7%).
- The new business ownership rate was 0.37% that year. The disparity between that rate and the overall ownership rate suggests fewer entrepreneurs continue long-term, the report says.
Stunning stat: The survival rate of young companies in NWA was 67% between 2016–2021. This beat all other markets in the report except Des Moines.
What they're saying: "I think the report is quite encouraging, right?" Lai said.
- "The data shows, in general … we are trending upwards … in all the statistics since 2018."
What's next: Lai said the next steps for the foundation are to keep bridging gaps, expanding access to funding mechanisms like Kiva loans and the Validation Fund, and eventually measure impact with more detailed reports.
📎 The Shift is a regular feature to catch up quick on what's happening in Arkansas' economy and entrepreneurial ecosystem.