That makes the Central Texas region a powerhouse of entrepreneurial activity.
Kauffman measures the rate of new entrepreneurs, opportunity share of new entrepreneurs and startup density. Kauffman measures all entrepreneurial activity from restaurants to law firms and not just technology startups.
Miami ranked second on the list, followed by San Jose, Los Angeles, Denver and San Francisco.
Overall, Texas ranked 17th among the states, down from the 13th spot last year, according to the Kauffman report. It slipped slightly in the rate of new entrepreneurs and startup density.
This Fast Company story has the nationwide breakdown on trends in entrepreneurship emerging from the Kauffman report.