Ohio is an attractive state for entrepreneurs looking to start a business thanks to its key Midwest location, well-developed infrastructure, and business-friendly legal environment. In 2023, almost 1 million small businesses called Ohio home. The state’s transportation network is an important asset and features major highways, railroads, cargo-friendly airports, and a connection to the Atlantic Ocean through the Port of Cleveland. Ohio also has moderate personal income tax rates and no corporate income tax, opting instead for a commercial activity tax (CAT) based on gross receipts.

Though aspects of Ohio’s tax structure and location are a draw for businesses, the state has more limited access to venture capital compared with other states. Potential entrepreneurs should carefully consider their needs and circumstances when weighing the advantages and disadvantages of starting a business in Ohio.

Below, we’ll explain how to start a business in Ohio, highlight the advantages and disadvantages, and detail resources to help you through the process.

What’s in this article?

• What sets Ohio apart from other states for entrepreneurs?
  
• How to start a business in Ohio
  
• Advantages and disadvantages of starting a business in Ohio
  
• Resources for starting a business in Ohio
  

What sets Ohio apart from other states for entrepreneurs?

Here’s how Ohio differs from other states regarding starting a business:

• Key location: Ohio’s central location within the United States makes it a prime logistics and distribution hub. The state has a well-developed transportation infrastructure that includes highways, railways, and airports, providing easy access to major markets in the Midwest and beyond.

• Diverse industry base: Ohio’s economy includes a diverse mix of manufacturing, healthcare, technology, finance, and agriculture sectors. This diversity offers entrepreneurs a wide range of opportunities and reduces the risk that an economic downturn will affect any one sector.

• Business-friendly tax climate: Ohio has no corporate income tax but imposes a relatively low gross receipts tax instead. The state has a variety of tax incentives and credits to attract and support new businesses, particularly in manufacturing and technology sectors.

• Research and development environment: Ohio is home to several world-renowned research institutions and universities such as The Ohio State University and Case Western Reserve University. This strong research and development environment breeds innovation and provides opportunities for collaboration between businesses and academia.

• Startup scene: Ohio has a vibrant startup scene, particularly in cities such as Columbus and Cincinnati. These cities have incubators, accelerators, and coworking spaces to support early-stage startups and create a collaborative environment for entrepreneurs.

• Advanced manufacturing and Industry 4.0: Ohio promotes advanced manufacturing and Industry 4.0 initiatives. Entrepreneurs in this space can benefit from supportive policies, access to cutting-edge technology, and a growing network of manufacturers embracing digital transformation.

• Manufacturing heritage and supply chain network: Ohio has a long history in manufacturing, particularly in automotive and aerospace industries. This has led to a strong supply chain network, which provides a reliable source of materials and components for businesses in those sectors.

• Business community: Ohio has a strong network of business organizations, chambers of commerce, and economic development agencies with resources, mentorship, and networking opportunities for entrepreneurs. This supportive community can be invaluable for new businesses seeking guidance and connections.

How to start a business in Ohio

Here’s a step-by-step guide for starting a business in Ohio:

Choose a name

Choose a unique business name, and ensure it’s not being used by another business in Ohio by checking the Ohio secretary of state’s business search tool. If you’re operating under a name that is different from your legal business name, you’ll need to register it with your county recorder’s office. Consider conducting a trademark search to avoid potential legal issues.

Choose a business structure

Consult with legal and financial advisors to choose the best business structure for your needs and goals. Choose among these structures:

• Sole proprietorship: This is the simplest business structure. Owners are personally liable for debts and obligations.

• Partnership: Partners share ownership of the business and are personally liable for debts and obligations.

• Limited liability company (LLC): LLCs offer personal liability protection and flexible management options.

• Corporation (S corp or C corp): Corporations provide the most liability protection but involve more complex formalities.

Register your business

Different business structures have different registration requirements and filing fees. You can pay filing fees online or by mail.

• Sole proprietorships and partnerships: These business structures are not required to register with the state but might need to register a “doing business as” (DBA) name.

• LLCs and corporations: These business structures must file formation documents with the Ohio Secretary of State’s Office.

Obtain an Employer Identification Number (EIN)

An EIN acts like a Social Security Number for your business and is required for tax purposes and opening a business bank account. Apply online through the IRS website.

Open a business bank account

A business bank account separates your personal and business finances for accounting and liability protection. Compare banks and their services to find the best fit for your business.

Obtain licenses and permits

Depending on your industry and location, you might need to acquire various federal, state, and local licenses and permits. For example, you’ll need a vendor’s license if you sell taxable goods or services, and certain professions such as contractors, cosmetologists, and healthcare providers require specific licenses to operate.

Research insurance and legal obligations

Before going into business, ensure you have the appropriate insurance and you fully understand your legal obligations.

• Insurance: Obtain appropriate insurance coverage to protect your business from liability, property damage, and other risks.

• Taxes: Register with the Ohio Department of Taxation, and understand your tax obligations.

• Local regulations: Check with your city or county for any additional local regulations or requirements.

Advantages and disadvantages of starting a business in Ohio

Ohio offers businesses a stable, affordable, and supportive environment. Its central location, diverse economy, and skilled workforce make it an attractive option for a variety of industries. Though access to venture capital might be limited in Ohio, the state’s focus on small-business support and workforce development programs can be invaluable for entrepreneurs seeking to establish and grow their businesses.

Here are the key advantages and disadvantages of starting a business in Ohio:

Advantages

• Cost of living: Ohio has a substantially lower cost of living than coastal states such as California. This translates to lower operational costs, making it easier for businesses to establish themselves and grow.

• Central location: Ohio’s geographic location in the heart of the Midwest provides easy access to major markets and a well-developed transportation infrastructure including highways, railways, and airports. This makes it an ideal location for businesses involved in manufacturing, distribution, and logistics.

• Business environment: Ohio has a reputation for being business-friendly, with streamlined regulations, tax incentives, and programs designed to support small businesses and startups.

• Economy: Though Ohio is known for its manufacturing heritage, its economy has diversified in recent years, with growing sectors in healthcare, technology, and renewable energy. This diversification offers a wide range of opportunities for businesses across various industries.

• Workforce: Ohio has a skilled workforce with a tradition of craftsmanship. The state is also home to numerous universities and technical schools, providing a steady pipeline of talent.

Disadvantages

• Limited access to venture capital: Compared with coastal hubs such as Silicon Valley, Ohio has a smaller pool of venture capital. This can make it challenging for startups seeking large investments to scale quickly.

• “Brain drain”: Ohio, among other Midwestern states, has faced a “brain drain,” with some young, educated professionals migrating to larger cities for better career opportunities.

• Limited diversity: Compared with states such as California, Ohio has a less diverse population. Though the state’s demographics are changing, it can be a factor for businesses seeking to attract a diverse workforce or cater to a wide range of customer demographics.

• Weather: Ohio experiences all four seasons, including harsh winters with snow and ice. This can sometimes disrupt business operations and increase transportation costs.

Resources for starting a business in Ohio

These resources can help you start your business in Ohio:

State government resources

• Ohio secretary of state’s business site: This government website has a wealth of information on how to start and run a business in Ohio, including information on registration, licenses, and taxes.

• Ohio Small Business Development Centers (SBDC): These centers provide free, confidential business advising, training, and resources for entrepreneurs at all stages.

• Ohio Minority Business Assistance Centers (MBAC): These centers help minority-owned businesses with services including certification, access to capital, and networking opportunities.

Local resources

• County economic development offices: Every county in Ohio has an economic development office with local resources, incentives, and assistance for businesses.

• Chambers of commerce: Local chambers of commerce have networking events, advocacy initiatives, and resources for businesses in their communities.

• Regional business incubators and accelerators: These organizations have mentorship, resources, and funding to help startups scale.

Additional resources

• JumpStart Inc.: This nonprofit venture development organization focuses on supporting entrepreneurs in Northeast Ohio.

• Rev1 Ventures: This venture capital fund and startup studio invests in and supports high-growth tech businesses in Ohio.

• The Brandery: This startup accelerator focuses on customer-facing brands based in Cincinnati.

Online resources

• Ohio business resource connection: This directory has resources for all Ohio businesses, with services for businesses owned by women, minorities, veterans, and people with disabilities.

• Ohio Business Magazine: This magazine provides news, information, and insights for Ohio businesses.

• OhioX: This tech-focused nonprofit connects and supports startups and tech businesses in Ohio.

Stripe Atlas 如何提供助力

Stripe Atlas 可为贵方公司搭建法律框架，助贵方在全球任意地点仅需两个工作日即可完成融资、开设银行账户及接受付款。

加入 75K+ 使用 Atlas 成立的公司，包括由 Y Combinator、a16z 和 General Catalyst 等顶级投资者支持的初创公司。

申请加入 Atlas

使用 Stripe Atlas 申请注册公司仅需不到 10 分钟。贵方可自主选择公司架构，即时核验公司名称是否可用，并添加最多四位联合创始人。贵方还需确定股权分配方案，为未来投资者和员工预留股权池，任命公司高管，最后通过电子签名签署所有文件。所有联合创始人也将收到邮件邀请，通过电子签名签署其对应文件。

在获取雇主识别号 (EIN) 前开通收款与银行账户功能

公司注册完成后，Stripe Atlas 将为贵方申请雇主识别号 (EIN)。持有美国社保号、美国地址及手机号码的创始人可享受美国国税局 (IRS) 加急处理服务，其他情况将适用标准处理流程（耗时可能稍长）。此外，Stripe Atlas 支持在 EIN 获批前开通收款与银行账户功能，助您在等待税务编号期间即可开展交易。

无现金式创始人股票认购

创始人可使用知识产权（如版权或专利）替代现金认购初始股份，相关认购凭证将存储于贵方 Atlas 管理后台。使用该功能需满足知识产权估值不超过 100 美元的条件；若您持有的知识产权价值高于此限额，请在操作前咨询专业律师。

自动提交 83(b) 税务申报

创始人可通过提交 83(b) 税务申报降低个人所得税负。无论贵方是美国籍或非美国籍创始人，Stripe Atlas 均可代为完成申报流程——采用 USPS 认证邮件寄送并附带物流追踪服务。贵方可直接在 Stripe 管理后台获取已签收的 83(b) 申报表及官方寄送凭证。

全球顶尖水准的公司法律文件

Atlas 提供您开始运营公司所需的所有法律文件。Atlas C 公司文件是与Cooley 合作建立的，后者是世界领先的风险资本律师事务所之一。这些文件旨在帮助您立即筹集资金，并确保您的公司受到法律保护，涵盖所有权结构、股权分配和税务监管合规等方面。

Stripe 支付服务首年免费，更享价值 5 万美元的合作伙伴专属优惠与折扣

Altas 与顶级合作伙伴深度联动，为创始人提供独家优惠与资源支持，涵盖 AWS、Carta、Perplexity 等行业领军企业的工程开发、税务合规、财务管理及运营必备工具折扣，更免费赠送首年特拉华州法定注册代理服务。作为 Atlas 用户，贵方还将解锁 Stripe 专属权益——最高 10 万美元交易额的全年免费支付处理服务。

了解 Atlas 如何助贵方极速开启创业之旅， 即刻启航。