Roots of Prosperity: The Drivers of Rural Entrepreneurship

Rural entrepreneurs are an essential part of the American story, building small businesses, creating jobs, and strengthening the communities they live in. But what helps entrepreneurship thrive in some communities more than others? New research by the Capital One Insights Center and the Center on Rural Innovation offers a closer look into the community assets that help drive rural entrepreneurship and how they work together.

In 2026, the Insights Center partnered with the Center on Rural Innovation (CORI) to launch the Rural Entrepreneurship Index, providing visibility into where entrepreneurship is growing across rural America. This next phase of the research goes a step further, examining what is driving that entrepreneurial momentum and how communities can build on the resources already at their disposal.  

“There is no single formula for building a strong rural economy,” said Dr. Shena Ashley, President of the Capital One Insights Center and Vice President of Community Impact and Investment. “What this research shows is that some of the most powerful opportunities for growth are rooted in the strengths communities already have. Understanding those differentiators and how they work can help inform how we support entrepreneurs and communities and create the conditions for entrepreneurs to start, grow, and build for the future.”

To explore these dynamics, CORI analyzed seven forms of community capital — natural, human, cultural, social, built, financial, and political — that serve as building blocks for entrepreneurial activity. These capitals were assessed across rural counties nationwide and paired with qualitative research in Bozeman, Montana. One key insight emerges across geographies: Rural America’s greatest advantage may be its very own backyard.

For example, the strongest predictor is not technological, educational, or political. Instead, natural capital emerged as the primary driver across all seven categories examined. Landscape, recreational opportunities, and other local amenities help rural communities attract the skilled workers and founders who create businesses

And while access to financial capital and institutional lending matter, they do not tell the whole story. The research suggests that relationships are just as important. Business associations, veteran networks, nonprofits, and other personal connections are associated with stronger entrepreneurial activity. In Bozeman, founders described how warm introductions and handshake agreements were central to getting things done — highlighting the value of social capital in connecting entrepreneurs to the financial resources they need to succeed.

"What this research makes clear is that having community assets isn't the same as putting them to work for entrepreneurs," said Amanda Weinstein, Director of Research at the Center on Rural Innovation and coauthor of the report. "Too many rural economies were built to extract from a place and its people rather than invest in them. Today, The rural communities seeing more entrepreneurship are doing the opposite, treating their landscape as a lasting asset and using it to build the talent, networks, and access to capital and support that founders need. This keeps wealth local and makes these places more resilient. A culture of self-reliance and openness to new ideas helps, too. Bozeman shows what that looks like, but the goal isn't to copy Bozeman. It's to help every rural community see its own mix of assets and build on them to support entrepreneurs."

Together, the findings point to an important principle: by recognizing, connecting, and investing in the resources that already exist in their communities, rural leaders can strengthen opportunities for entrepreneurs to plant and grow businesses and for surrounding communities to share in the prosperity that follows. 

This research reflects Capital One’s broader strategy to advance economic opportunity through its five-year, $265 billion Community Benefits Plan, which includes increased access to credit for small businesses in rural and low-to-moderate-income communities, strengthening community development financial institutions, and investing in local economic infrastructure.  By helping communities better understand their entrepreneurial strengths, the research can help local leaders, policymakers, funders and other stakeholders identify opportunities for investments that build on existing assets and strengthen economic conditions and entrepreneurship over time.