Startup activity sputtering in Indiana, report says

Last year was particularly sluggish for Indiana startup activity, if an updated study from the Ewing Marion Kauffman Foundation is any indication.

The Kansas City, Mo.-based foundation, which studies and promotes entrepreneurship, reports activity was weaker in Indiana than in all but four other states—West Virginia, Pennsylvania, Wisconsin and South Dakota. The Midwest, by the way, is the weakest region overall.

Only 190 of 100,000 Indiana adults started a business in 2010, Kauffman said. The most active state was Nevada, where one in 510 launched one. Georgia and California also were hot.

Some caveats are in order. Tiny changes can swing the rankings because the smallest of differences separate some states. It wouldn’t have taken a lot to move Indiana up or down a few notches.

Also—and this was the main point of Kauffman’s latest report—many startups birthed during the Great Recession and its aftermath have been one-person shops. People are hanging shingles to keep themselves employed, which helps explain the so-called jobless recovery. Some of the businesses could vanish as soon as good jobs materialize. And some of those that stay in business may never amount to much.

Still, Indiana’s ongoing poor to middling startup rankings aren’t good news for a state needing more juice. Startups often supply the ideas, the energy and the lifeblood of economies.

What are your thoughts?