News Releases

March 13, 2008

New Business Starts Slow Down in 2007

Filings with Vermont's Secretary of State's Office show new business starts lagging in 2007

Montpelier. Secretary of State Deb Markowitz announced today that the number of new businesses registered with her office's Corporations Division during the year 2007 have declined as compared to prior years. As of January 1, 2008, there were registered in Vermont 16,561 Vermont corporations, 8,848 foreign corporations (out-of-state companies doing business in Vermont), 43,143 trade names (sole proprietorships), and 15,641 limited liabilities companies. Of these, 9,452 were newly formed in 2007. This is somewhat less than the 9,971 new businesses that registered in 2006.

Secretary of State Deb Markowitz said, “The slow down of newly formed business entities is a change from the steady increases we have seen over the past decade. It may simply be an anomaly or it may reflect Vermonters’ concerns about a potential recession or it could be a result of the contraction of the lending market.” Markowitz said, “Although 500 fewer new businesses registered in 2007 than the previous year, it is important to remember that this is considerably more than what we saw a decade ago.” In 1997 there were 7,235 new business registrations, which is over 2,000 less than in 2007.

"In past years we have found that our business-starts statistic is a good barometer of confidence within the business community,” said Secretary Markowitz. “The fact that we continue to have over 9,000 new businesses registering in the state is good news, but we should be watching carefully to see whether the slight decline is an aberration or the start of a new downward trend,” Markowitz said. According to Markowitz, corporate dissolutions are also up slightly. The 867 dissolutions in 2007 represent a small decrease from the 883 dissolutions in 2006.

The 9,452 new Vermont business starts in 2007 include businesses that have been formed as corporations, as limited liability corporations and those using a tradename. Markowitz said “We did not see a decrease in every form of business entity this year. This year we saw continued growth in new businesses forming as LLCs.” Markowitz said, “With the exception of last year, over the past six years the number of new LLCs has increased by about 300 a year,” said Secretary Markowitz. “In 2007 about 260 more new LLCs formed as compared to 2006.”

Markowitz said “The 929 new foreign corporations filed in 2006 represent a decrease of about 40 from the new filings registered in 2006.”

In addition to seeing a decrease in growth for certain for-profit enterprises, the Secretary of State's office also experienced a decrease in filings of new non-profit corporations. The 413 new nonprofit corporations represented 50 fewer filings than in 2006.

The Office of the Vermont Secretary of State licenses and registers foreign and domestic corporations, non-profits, LLCs, and tradenames and is the repository for Uniform Commercial Code filings. Information about the services offered by the Corporations Division, including registration forms and searchable databases, is available at www.sec.state.vt.us.

#30

Secretary of State’s Office – New Business Registrations

YEAR (1996 - 2007) 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

New Corporations 2833 2703 2494 2635 2556 2387 2577 2753 2634 2479 2391 1851

New Trade Names 4025 3998 3948 4024 3989 3866 4328 4591 4296 4212 4317 4074

New LLC 184 534 682 917 1223 1504 1863 2262 2801 3124 3263 3527

TOTAL 7042 7235 7124 7576 7768 7757 8768 9606 9731 9815 9971 9452

Source: Secretary of State
Last Updated at: March 13, 2008 12:29:39