The Draper Hero Index (DHI) says it will start monthly updates to its United States Draper Innovation Index (DII US), a measurement of a state’s competitiveness when it comes to entrepreneurship and innovation. The Index is created in partnership with Dun & Bradstreet – beginning in January 2022.
The Draper Hero Institute (DHI) is the creation of Timothy Draper, a well-known VC who has been very active in the blockchain/crypto sector. Described as an “action-based research institution,” DHI focuses on “non-traditional pathways to guide future entrepreneurs in the new economy.”
The DII US aggregates six sub-indices that seek to reflect aspects of state-level business and innovation environments, including:
- Technology R&D and Workforce Environment;
- Global Economic and IT Infrastructure;
- Entrepreneurs/Startup Environment;
- Small Business Policy Environment;
- Tax Environment;
- Social Environment.
The index also incorporates two key DNB indices: the Overall Business Health Index (OBHI) and the US Small Business Health Index (SBHI).
The March 2022 Index for the top ten most competitive states is as follows:
- Washington
- Florida
- Texas
- Wyoming
- South Dakota
- Massachusetts
- Colorado
- Utah
- Alaska
- Virginia
Of note, is the fact that many of the top states are low tax, or no tax states when it comes to individual state income taxes.
DHI notes that California is home to some of the nation’s most successful tech companies as well as being the destination for more VC funding and Bitcoin/blockchain investment than any other state, finished eleventh on the list due to its performance on the Small Business Policy Environment and Tax Environment sub-indices. DHI states that It has consistently finished at or near the bottom of these indices since the first publication of the DII US.
“California actually lost population in 2020, for the first time in its history,” said Dr. Wallace Walrod, DHI’s Chief Economic Advisor. “The state’s high cost of living, in addition to relatively unfriendly small business and tax policies, could create significant economic repercussions in the long term. Non-traditional tech powers such as Wyoming, South Dakota and Utah, on the other hand, are leveraging welcoming small business policy and in some cases cryptocurrency policy as powerful ways to attract new entrepreneurs and investors.”