BizWorld Updates Monthly Draper Innovation Index U.S.
States Compete to Land in Top Ten of Best Places to Launch a Startup

North Carolina and Colorado Overtake Georgia in DII US Top 10
California Resumes Decline to 34th; New York Remains Steady at 47th
Alaska, Idaho, and North Dakota Climb in DII US Top 20
Nevada, Michigan, Virginia, Indiana, and Washington Sink in DII US Top 20
South Carolina, Illinois, Massachusetts and Missouri Gain
Montana, Ohio, Georgia, and Nebraska Decline

San Mateo, California – BizWorld announces the August 2026 update to the Draper Innovation Index U.S. (DII US), which evaluates each state’s innovation environment and entrepreneurship climate. Published monthly since 2021, the DII US provides the most well-rounded, up-to-date ranking of entrepreneurial locations, reflecting both traditional and emerging economic metrics, from taxes and regulations to venture capital investment, cryptocurrency friendliness, and blockchain investment trends.

“With economic powerhouses like California (34th), Washington (19th), and New York (47th) continuing to decline, it signals a stark warning for legacy innovation hubs, proving that sheer market size cannot offset a punishing environment for brand-new ventures,” said BizWorld Founder Tim Draper. “Founders are prioritizing cost-efficiency and regulatory ease over legacy startup hubs. High living costs and heavy administrative friction in these large states are steadily funneling founders, talent, and capital toward faster-growing, more friendly innovation and investment ecosystems. Without structural relief for founders and investors, these states risk continuing loss of competitive edge to more agile markets.”

Top Takeaways from the DII US August 2026 Update

Key Risers: Alaska, South Carolina, Illinois, Massachusetts, Missouri
Key Fallers: California, Montana, Ohio, Georgia, Michigan, Nebraska, Nevada, Virginia

• While New York remained stable at 47th, California resumed its steady decline, falling from 32nd to 34th in the DII US as well below-average new business formation metrics dragged the state lower.
• Georgia slipped from 6th to 8th in the DII US Top 10 as it was outperformed by North Carolina and Colorado in both cryptocurrency/blockchain-related venture capital investments and new business formation metrics.
• Nevada sank from 12th to 14th on weakness across all new business formation metrics.
• Alaska, on the other hand, saw the month’s largest gain. It jumped from 19th place to 13th due primarily to strong new business formation metrics.
• South Carolina rose four places to 30th in the DII US thanks to a combination of overall venture capital investment growth and above-average performance in new business formation metrics.
• Illinois improved from 33rd to 31st in the DII US due to a combination of overall venture capital investment growth and new business formation performance.
• Missouri rose from 22nd place to 20th, thanks to strong performance in new business formation trends.
• Massachusetts rose from 25th place to 23rd supported by overall venture capital investment growth and gains in cryptocurrency/blockchain-related venture capital investment.
• Montana posted this month’s largest decline, falling four places to 24th in the DII US due to below average overall venture capital investment trends, slow cryptocurrency/blockchain-related venture capital investment growth, and weakness in new business formation metrics.
• Ohio declined to 32nd as strong venture capital investment growth failed to offset below-average new business formation.
• Michigan (16th) and Virginia (17th) both declined by two places in the DII US Top 20. Michigan was weighed lower due to comparatively lower new business formation, while Virginia fell due to a combination of lower venture capital investment growth and weak new business formation metrics.
• Nebraska dropped to 33rd due to weak overall venture capital investment and no cryptocurrency/blockchain-related venture capital investment.
• Idaho rose to 12th thanks to registering the single largest increase in cryptocurrency/blockchain-related venture capital investment growth.
• North Dakota also rose to 15th overall, primarily due to healthy new business formation trends.
• Indiana sank from 17th to 18th while Washington slipped from 18th to 19th. Indiana saw below-average performance in overall venture capital investment trends and specifically cryptocurrency/blockchain-related venture capital investments while Washington struggled with below-average performance in new business formation.

“Alaska delivered the single biggest jump on the DII US this month, leaping six spots straight to 13th place overall, a clear signal that the state is turning its unique economic landscape into a serious competitive advantage,” said BizWorld Chief Economic Advisor Dr. Wallace Walrod. “The Alaska Permanent Fund, which is a sovereign wealth fund from oil and mining revenues, is a quintessentially Alaskan innovation that other states could learn from. Driven by a strong surge in new business filings, steady resource revenues, and high levels of federal defense spending, Alaska proves that major innovation hubs don’t just belong in traditional coastal metros. As this underlying industrial strength blends with rising entrepreneurial activity, Alaska is rapidly positioning itself as a compelling destination for tech founders and investors.”

The DII US will continue to post monthly updates which can be accessed here.

About BizWorld

BizWorld.org is a global non-profit organization based in San Mateo, CA, whose mission is to equip future generations with entrepreneurial life skills to unlock their potential and create economic opportunity. Founded over 25 years ago by Silicon Valley venture capitalist Tim Draper, BizWorld.org programs teach students real-world 21st century skills and leadership that encourage them to become responsible leaders and entrepreneurs of tomorrow. More than 850,000 students in more than 100 countries have participated in BizWorld programs. https://www.bizworld.org/