Business Formation Report | July 2025

Key Takeaways

• Business formations nationwide were up both month over month (4%) and year over year (10%) for the first time since March 2025.
• Wyoming surprised with a steep decrease in formations. Colorado and Maryland also saw sharp declines.
• Michigan, Illinois, New Hampshire, and Washington saw significant gains.
• Business owners we spoke with continued to report strong optimism about the health of their businesses.

Summer Slump Ends

The so-called summer slump in business formations seems to have ended in July. Formations nationwide were back on an upward trend for the first time in three months, with a 4% increase from June 2025 and up overall 10% compared to July 2025.

This seasonal shift could mark the beginning of an upward trend as entrepreneurs prepare for fall.

Wyoming Sees Surprising Drop in Business Formations

While business formations were up nationwide in July, Wyoming reversed its upward trajectory with a sharp 15% decline in business formations. Due to its strong privacy protections, Wyoming tends to be a popular state for LLC formation among both out-of-state and international owners. A downturn in business formations in Wyoming could be an early indicator of a downturn in formations nationwide, or a harbinger of decreased foreign investment in the United States.

Colorado and Maryland also saw declines. Colorado’s drop (-17%) follows a study from the Leeds School of Business indicating that business confidence remains “squarely in negative territory” in Q3.

Business Owners Continue to Express Confidence

Despite the continued pressure of rising costs, 84% of business owners we spoke with reported feeling “very optimistic” about the upcoming year—an even higher number than in June. More than half (63%) of business owners said the health of their business was stronger now than it was this time last year, and 66% said they did not have to restructure their business in response to external pressures.