Phoenix is a great place to start a business — in fact, it’s one of the best places in the country for fledgling companies, according to a report from CommercialCafe.

The Valley of the Sun ranked as the No. 1 big city — defined as those with populations over one million — when it comes to not only startup density, but overall business growth.

Eleven percent of all businesses in Phoenix are less than one year old, which indicates a welcoming environment for startups. That proportion has skyrocketed over the past five years: Young businesses have increased by 27.4% since 2019. More importantly, though, 65.1% of those new businesses survived.

The city also has the workforce to back up those new businesses. Phoenix’s population of freelance workers increased 11.1% from 2019 to 2023, with over 62,000 self-employed residents ready to contribute their expertise. The city’s college-educated population also jumped 28.9% during the same time frame, accounting for nearly one quarter of all residents.

Furthermore, the city has a regional price parity of 105.5 out of 100, meaning business operating costs are only slightly less affordable than the national average.

Among smaller cities — those with less than one million residents — nearby Mesa ranked No. 5, mirroring Phoenix’s stats for workforce education, startup density and new business survival.