Most Friendly States for LGBTQ Businesses

LGBTQ founders created 36% more jobs, 114% more patents, and 44% more exits with 16% less funding compared to the average founder, between 2000 and 2022. While it’s currently impossible to know the exact number of LGBTQ businesses in the United States, there’s no doubt that LGBTQ-owned businesses have a big impact on the American economy.

According to the National LGBT Chamber of Commerce, LGBTQ-owned businesses have contributed $1.7 trillion to the economy and created over 33,000 jobs. Additionally, LGBTQ businesses often serve their local community, with 70% of LGBTQ majority-owned businesses delivering products locally.

While these businesses play a crucial role in the business community, they still face numerous challenges, including prejudice and limited access to capital and growth opportunities. B2B Reviews compared all 50 states and the District of Columbia across seven key metrics to find which states are most friendly for LGBTQ businesses in 2025.

Read our methodology to see how we determined our final rankings.

Top LGBTQ-Business-Friendly States in 2025

Take a look at the top states to see what makes them LGBTQ-business friendly.

1. Nevada

Nevada took the top spot for the most friendly state for LGBTQ businesses. It earned the most possible points for the State Equality Index, meaning that it has a broad range of protections to ensure equality for LGBTQ individuals. Additionally, Nevada has a high concentration of LGBT Business Enterprises (LGBTBEs) (defined in methodology), with an average number of 25.5. Also, 5.5% of Nevada’s adults identify as LGBTQ, which is the same as the national percentage. Similarly, 6% of the workforce is LGBTQ, which is higher than the national average of 5%.

Nevada also saw no change in its LGBTQ Business Climate Index from 2023 to 2024, making it a consistently friendly state. For business-specific factors, Nevada saw a 6.45 percent increase in small businesses from 2022 to 2024, which is higher than the national increase of 4.82%. However, as of April 2025, Nevada had an unemployment rate of 5.6, which is higher than the national average of 3.9.

2. Vermont

Vermont takes second place for friendliest state for LGBTQ businesses. It scored the maximum number of points on the State Equality Index. Of Vermont’s adult population, 5.2% identify as LGBTQ, and an impressive 6% make up the workforce, which is higher than the national percentage.

Additionally, Vermont saw a 2.29% increase in its LGBTQ Business Climate Index from 2023 to 2024, showing that the state actively improved its LGBTQ-friendly measures. This is significantly higher than the national change, which, unfortunately, was a decrease of -1.83. Vermont also experienced a 1.85 percent increase in small businesses, and as of April 2025, it has a lower-than-average unemployment rate of 2.7%.

3. Delaware

Delaware comes in third place. It has an average of 5.5 LGBTQBEs and the most points possible on the State Equality Index. Additionally, 4.5% of adults identify as LGBTQ, and 5% of Delaware’s workforce consists of LGBTQ individuals. Delaware also saw the highest percent increase in small businesses from 2022 to 2024, at 11.50%.

From 2023 to 2024, Delaware saw a 2.26 percent increase on the LGBTQ Business Climate Index, higher than the national change of -1.83. Additionally, Delaware’s unemployment rate matches the national average, at 3.9.

4. Oregon

Coming in fourth place is Oregon. While it has a lower average number of LGBTQBEs (5.5), it earned the maximum number of points for the State Equality Index. It has a higher percentage of LGBTQ adults (5.6%) than the national percentage (5.5%). Also, 6% of Oregon’s workforce identifies as LGBTQ, which is higher than the national average (5%). Oregon also saw a significant percent increase on the LGBTQ Business Climate Index (2.65%).

5. Illinois

Illinois takes fifth place for its higher average of LGBTBEs (25.5) and maximum number of points on the State Equality Index. While Illinois has a lower percentage of LGBTQ adults (4.3%), it has a decent percentage of LGBTQ individuals in the workforce (5%). The state also saw a positive change in the LGBTQ Business Climate Index, with a 2.31% increase. Additionally, Illinois ties with Georgia with the ninth-highest percent increase in small businesses from 2022 to 2024, at 8.33%.

6. Maryland

Coming in sixth place is Maryland. The state has an average of 25.5 LGBTBEs and the highest number of points on the State Equality Index. It also saw a higher than average percent increase on the LGBTQ Business Climate Index (0.80), which is more than the national change (-1.83).

Also, 5% of Maryland’s workforce and 4.2% of the adult population identify as LGBTQ, which are only a few points below the national averages. Maryland saw a 5.32% increase in small businesses between 2022 and 2024, which is higher than the national increase of 4.82%. Finally, it has an unemployment rate of 3.1%, which is less than the national average of 3.9%.

7. California

California comes in seventh place. It is one of the few states with an exact number of LGBTBEs, at 219, placing it in first place for that metric. California scored the most points on the State Equality Index. It also has a higher percentage of LGBTQ individuals in the workforce, at 6%; however, interestingly, only 5.3% of adults identify as LGBTQ, which is slightly less than the national percentage.

From 2023 to 2024, California experienced a 0.20% increase in the LGBTQ Business Climate Index, surpassing the national change. What brings California lower on our list is its higher unemployment rate of 5.3% and a 0% increase in the number of small businesses.

8. Washington

Taking eighth place for the most friendly states for LGBTQ businesses is Washington State. It has an average of 25.5 LGBTBEs and the maximum number of points possible on the State Equality Index. Similarly, Washington maintained its score on the LGBTQ Business Climate Index, meaning it didn’t lose any points between 2023 and 2024, which is more than the national change of -1.83. Additionally, 6% of Washington’s workforce identifies as LGBTQ, which is higher than the national percentage.

9. Maine

Maine comes in ninth on our list. The state scored the most number of points on the State Equality Index. It also saw a 1.43 percent increase on the LGBTQ Business Climate Index, which is higher than the average change (-1.83%). Maine also saw decent growth in the number of small businesses between 2022 and 2024, with a 3.92% increase. Its unemployment rate is less than the national average at 3.5%.

10. Georgia

Georgia tied with New York for tenth place. It’s one of the few states with an exact number of LGBTBEs (44), ranking it fifth in this metric. Georgia also comes in second for the LGBTQ Business Climate Index, with a 6.07% increase from 2023 to 2024. Finally, it ties with Illinois for ninth in state business growth, with an 8.33% increase in small businesses. Georgia also has a lower-than-average unemployment rate, at 3.6%.

10. New York

New York ties with Georgia for tenth place. The Empire State has an exact number of LGBTBEs (108), which places it second for that metric. It scored the most number of points on the State Equality Index. Between 2022 and 2024, New York saw a 10.60% increase in small businesses, and it has a lower-than-average unemployment rate of 3.7%. What brings New York to tenth place is its significant decrease on the LGBTQ Business Climate Index (-10.71).

Methodology

To determine which states are most friendly for LGBTQ businesses in 2025, we examined key metrics that focused not only on business factors but also on the LGBTQ community.

We identified seven key metrics that impact the LGBTQ community and business owners, and compared them across all 50 states and the District of Columbia. Metrics that reflected a steady LGBTQ community and demonstrated significant effort to protect and grow LGBTQ-owned businesses scored higher. We ranked each state within each metric and then graded them on a 100-point scale, with 100 points representing the most friendly environment for LGBTQ businesses.

Average Number of LGBTBEs—Total 10 Points

LGBTBEs stands for LGBT Business Enterprises. The National LGBT Chamber of Commerce created this term and certifies businesses as such nationwide. NGLCC-certified businesses must fulfill criteria, including a “majority (at least 51%) owned, operated, managed, and controlled by an LGBT person.”

The NGLCC does not list an exact number of LGBTBEs for each state, but it lists ranges. To streamline ranking, the B2B Reviews research team gathered the ranges for each state and found the average number. States with a higher average scored more points.

It’s important to note that these numbers are estimates, based on available data, and should not be taken as exact numbers.

State Equality Index—Total 20 Points

The State Equality Index is created by the Human Rights Campaign. It separates states into one of four categories: High Priority to Achieve Basic Equality, Building Equality, Solidifying Equality, and Working Toward Innovative Equality.

The B2B Reviews research team assigned each category a number of points (1-4). States in categories with more points scored higher, as they demonstrate an increased range of protections that ensure equality for LGBTQ people.

Percent of LGBTQ Adults—Total 20 Points

Using data from the Movement Advancement Project, we found what percentage of adults who identify as LGBTQ in each state. States with a higher percentage of LGBTQ adults earned more points, as this indicates a larger LGBTQ community.

Percent of LGBTQ Workforce—Total 15 Points

We found the percentage of each state’s workforce that identifies as LGBTQ, using data from the Movement Advancement Project. States with a larger percentage of LGBTQ workers scored higher.

LGBTQ Business Climate Index Percent Change—Total 20 Points

The LGBTQ Business Climate Index is made by Out Leadership, a NGLCC-certified LGBTBE. It tracks five metrics (Legal and Nondiscrimination Protections, Youth and Family Support, Political and Religious Attitudes, Health Access and Safety, and Work Environment and Employment) across all fifty states.

B2B Reviews looked at each state’s index score from 2023 and 2024. We then found the percent change (increase and decrease). States that did not change or had an increase in their index score earned more points, as this demonstrates an active effort to improve LGBTQ business conditions.

State Business Growth Percent Increase—Total 10 Points

Using data from the U.S. Small Business Administration, we found the number of small businesses in 2022 and 2024. We then determined the percent increase of small businesses in each state. States with a greater increase scored better on the list.

State Unemployment Rate—Total 5 Points

Using the latest data from the U.S. Bureau of Labor Statistics, the B2B Reviews research team gathered the unemployment rate for all fifty states and the District of Columbia. States with a lower unemployment rate earned more points.

The Bottom Line

LGBTQ-owned businesses have a significant impact on the economy, creating jobs, patents, and promoting diversity, all while facing disparities in both funding and social acceptance. Although progress toward equality is being made, true equity still requires intentional, state-level commitment.

Based on the most friendly states for LGBTQ-owned businesses, we can see that active efforts to implement inclusive measures lead to overall business growth. However, even in the top-ranking states, there’s more work that could be done to ensure that LGBTQ entrepreneurs have the support and resources needed to thrive.

What can LGBTQ founders and advocates do to help improve the situation?

• Explore certification—By seeking certification through the National LGBT Chamber of Commerce, LGBTQ businesses can boost visibility and access diversity programs.
• Advocate for policy change—By focusing on implementing non-discrimination protections or anti-bullying laws and advancing innovative legislation in your state, you can help create equality for LGBTQ communities and vulnerable populations.
• Build or join local networks—Having access to a network of LGBTQ professionals and allies helps spread resources and foster a supportive ecosystem.
• Research local areas—When choosing where to grow or build a business, in addition to knowing your consumer base, look for states with strong equality and business growth.

LGBTQ business owners don’t simply participate in the American economy—they’re growing it. By recognizing and improving the places they do business, we can make vital steps toward a more inclusive and prosperous business environment.

Fair Use Statement

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