The 8 Best Small Businesses to Start in California

Mantis Funding October 05, 2023

California is not just renowned for its celebrities and beaches; it’s also a land of opportunity for those with an entrepreneurial spirit. When considering the best business to start in California, diverse options such as barber shops, vibrant food trucks, and many others are readily available. And with over 4 million small businesses in the Golden State as of 2022 alone — there’s room for everyone. Whether you’re an entrepreneur or a second-generation business owner looking for a new venture, California presents a myriad of lucrative opportunities. Keep reading to see some of the state’s most promising and popular business niches.

1. E-Commerce

In the digital age, e-commerce stands out as one of the most profitable ventures. Online shopping offers benefits for both the business owner and the customer alike. With minimal initial expenses and access to a vast online market, e-commerce enterprises in California stand poised to achieve substantial profits — having generated a staggering $297 billion in 2022 alone. The state’s tech-savvy population is on the cutting edge of platforms and apps, making it an ideal location for online businesses.

2. Shoe Store

Footwear remains timeless, positioning a shoe store as arguably the best small business to start in California. Sustainable shoe brands like Zuzii and Allbirds have their roots in the Golden State. Entrepreneurs have the flexibility to opt for a traditional brick-and-mortar store or venture into the online realm. Initial costs for both, excluding inventory, tend to be relatively low. Custom or designer shoe stores, in particular, cater to California’s fashion-forward crowd, ensuring steady sales and growth.

At Mantis Funding, we offer retail growth support, allowing businesses to invest in renovations, staffing, and inventory replenishment.

3. Real Estate Rentals

California, with its varied landscapes and tourist attractions, is a prime location for real estate rentals. Businesses focusing on property leasing thrive here, from Airbnb accommodations for vacationers to traditional rentals for both short-term and long-term tenants. Many find renting more affordable than purchasing property — encompassing options from mobile homes to warehouses and even office spaces. Whether it’s beachfront homes or urban apartments, California’s real estate market is consistently buzzing.

4. Barber Shop

Personal grooming is essential, and barber shops have stood the test of time as a reliable business. In California, where appearances matter, opening a barber shop can be a lucrative venture. From selecting the right location to building a loyal clientele, with the right strategies, your barber shop can become the talk of the town.

Applying for revenue-based financing is straightforward. This alternative financing method provides working capital in exchange for a portion of your business’s future revenue. It’s an excellent resource for needs like inventory, payroll, and marketing. To be eligible, you should own at least 50% of the business, have been in operation for a minimum of 6 months, and meet a basic credit score requirement (low scores are okay!). After submitting your application, one of our representatives will reach out within 72 hours. Once the financing agreement is signed, funds can be in your account in as little as one business day.

5. Custom or Designer Cakes

Celebrations are incomplete without cakes. Custom or designer cake businesses in California can generate substantial revenue with minimal overheads. With a blend of online marketing and word-of-mouth, even a small bakery can make big waves in the local community. The thriving culinary scene makes it one of the best places to start a business in California.

6. Restaurant

California’s diverse population brings a rich tapestry of cuisines. Niche eateries, inspired by the state’s vibrant food culture and promoted through social media, have made cities like Los Angeles, San Francisco, and San Diego some of the best places to start a business in California.

It’s no secret that restaurants can face challenging times. Let Mantis Funding help your business grow with revenue-based financing. From purchasing new equipment like ovens and fryers to training and hiring new staff, funding can cover a myriad of unexpected issues.

7. Second Hand Retail

The trend of sustainable shopping is on the rise, especially in places like California. Consignment stores and thrift shops can offer a substantial return on investment. The secondhand market is projected to reach $53 billion in 2023. Second-hand retail stores in California offer consumers quality products at a fraction of the cost. With minimal overheads like building rent, marketing, and a small staff, this business model is both popular and profitable.

8. Fitness Center or Gym

Californians are health-conscious, and there’s always a demand for fitness centers and gyms. A fitness center is the best small business to start in California. Whether it’s a yoga studio by the beach or a downtown gym, the state’s focus on health and wellness ensures a steady clientele.

California is a land of dreams and opportunities. If you’re in search of the best business to start in California, check out some of the popular businesses listed above — promising both profitability and growth. If you’re looking to embark on an entrepreneurial journey in California, these options are worth considering. And remember, if you need revenue-based financing to boost your venture, Mantis Funding is here to help. Contact us today.

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About Mantis Funding

Mantis Funding is a business financing solutions firm catering to small and mid-sized business owners in the United States.