Research Maps Rural Entrepreneurship Strengths

Capital One Insights Center and the Center on Rural Innovation have released research on the local strengths associated with rural business creation. The report examines seven forms of community capital through county-level analysis and research in Bozeman, Montana. Small businesses account for more than half of rural employment, according to the U.S. Small Business Administration, while rural employment grew 0.6% from 2023 to 2024, compared with 1.3% in metropolitan areas. The findings identify natural amenities as the strongest predictor of rural entrepreneurship.

Community Assets and Business Growth

The report, “Roots of Prosperity: The Drivers of Rural Entrepreneurship,” examines natural, human, cultural, social, built, financial and political capital. It finds that communities can support founders by recognizing their existing strengths and investing in conditions that help businesses start and grow.

“There is no single formula for building a strong rural economy. What this research shows is that some of the most powerful opportunities for growth are rooted in the strengths communities already have. Understanding those differentiators and how they work can help inform how we support entrepreneurs and communities and create the conditions for entrepreneurs to start, grow, and build for the future.”

Natural Assets Lead Findings

Natural capital, including landscapes, recreation and local amenities, was the strongest and most consistent predictor in the analysis. The research says these assets can help communities attract and retain skilled workers and founders, while creating opportunities for businesses tied to the landscape.

“What this research makes clear is that having community assets isn't the same as putting them to work for entrepreneurs. Too many rural economies were built to extract from a place and its people rather than invest in them. Today, the rural communities seeing more entrepreneurship are doing the opposite, treating their landscape as a lasting asset and using it to build the talent, networks, and access to capital and support that founders need. This keeps wealth local and makes these places more resilient. A culture of self-reliance and openness to new ideas helps, too. Bozeman shows what that looks like, but the goal isn't to copy Bozeman. It's to help every rural community see its own mix of assets and build on them to support entrepreneurs.”

Relationships and Local Support

The findings associate experienced workers, professional networks and financial resources with rural entrepreneurship. They also point to local networks such as community banks, Community Development Financial Institutions, business associations, veteran networks and nonprofits as relationship-driven connections linked with stronger outcomes.

The report says broadband can be more effective when paired with coworking spaces, mentorship, incubators, accelerators and programs that connect entrepreneurs with resources. It also identifies broadly shared investments, including workforce training, childcare, healthcare and entrepreneurial infrastructure, as components of a strong local ecosystem.

Explore County Results

The Rural Entrepreneurship Index’s interactive map lets users explore county performance and the strengths associated with entrepreneurship in different places. The research builds on a convening in Bozeman that brought together entrepreneurs, small business owners, policymakers, educators, lenders and civic leaders.