The 6 Worst Types of Businesses to Start in 2026 (According to Investors and Experts)

Every year, I hear it.

“I’m thinking about starting a business.”

And I love that. I really do.

Small towns run on brave people who decide to take a chance on themselves. But here’s the truth most people won’t tell you:

Not every business idea is a good idea — especially in 2026.

Some industries are getting squeezed by regulations. Some are losing funding. Some are being replaced by technology. Some are just becoming harder and harder to survive in.

So today, let’s talk honestly about the six types of businesses investors and experts say are the toughest to start right now — and what to do instead.

1. Brick-and-Mortar Retail (Without a Clear Niche)

Opening a little shop on Main Street sounds charming.

And sometimes, it works.

But a general “we sell a little of everything” store?

That’s risky in 2026.

Big retailers. Amazon. Fast shipping. Lower prices.

They’re tough competitors.

If you don’t have:

✔ A strong brand

✔ A loyal local following

✔ Unique products

✔ A great experience

…you’ll struggle.

Better approach: If you love retail, niche down. Specialize. Give people a reason to visit you instead of clicking “Buy Now.”

2. Traditional Print Media

Local newspapers. Magazines. Printed newsletters.

They matter. They do important work.

But financially?

They’re under serious pressure.

Advertising dollars keep moving online. Printing costs keep rising. Subscriptions keep shrinking.

That makes starting a new print-focused business very difficult.

Better approach: Go digital-first. Build an audience online, then add print later if it makes sense.

3. Ride-Sharing or Delivery Startups

You might think:

“I’ll start a local Uber-style service.”

Sounds smart.

But here’s the problem:

You’re competing with billion-dollar companies.

They have:

✔ Massive tech teams

✔ Huge marketing budgets

✔ Established apps

✔ Legal departments

Local startups get crushed before they scale.

Plus, regulations around gig workers keep changing.

Better approach: Focus on specialized local services — medical transport, senior rides, rural delivery — where big companies aren’t focused.

4. Cryptocurrency & Speculative Finance Businesses

Crypto. NFTs.“ Guaranteed returns.” Trading platforms.

In 2026, regulators are watching closely.

Rules are tighter. Enforcement is stronger. Investors are cautious.

Many of these businesses now face:

• Licensing issues

• Compliance costs

• Trust problems

• Legal risks

That makes entry expensive and risky.

Better approach: If you’re interested in finance, look at education, consulting, or compliant fintech services instead.

5. Independent Restaurants (Without Experience or Capital)

I know this one hurts.

Restaurants are the heart of small towns.

But starting one from scratch?

It’s one of the hardest businesses anywhere.

Margins are thin. Food costs are unpredictable. Staffing is tough. Rent keeps rising.

In 2026, those pressures haven’t gone away.

If you don’t have:✔ Industry experience✔ Cash reserves✔ Strong systems✔ A clear concept

…it’s a tough road.

Better approach: Start small: food trucks, pop-ups, catering, or shared kitchens. Test before you invest everything.

6. Highly Regulated Healthcare Startups

Healthcare is important. Healthcare is growing. Healthcare is complicated.

Starting a new healthcare-related business means dealing with:

• Licenses

• Insurance rules

• Privacy laws

• Billing systems

• Compliance audits

All of that costs money and time.

For first-time entrepreneurs, it can be overwhelming.

Better approach: Partner with existing providers or start in support services before launching something bigger.

So… Should You Be Discouraged?

Absolutely not.

This list isn’t about killing dreams.

It’s about protecting them.

Too many good people lose time, money, and confidence because nobody warned them about the obstacles.

Smart entrepreneurs don’t just ask:

“Is this a good idea?”

They ask:

“Is this a good idea right now?”

What Works Better in 2026 (Especially in Small Towns)

If you’re looking for safer ground, investors are liking businesses that focus on:

✔ Local services

✔ Home repair and trades

✔ Senior care

✔ Childcare

✔ Tourism and experiences

✔ Digital + local hybrids

✔ Niche retail

✔ Community-based brands

These grow with trust — something small towns already have.

Build Where You’re Needed

The best businesses don’t start with trends.

They start with gaps.

What does your town need more of?

What problem keeps coming up in conversations?

What do people drive 30 minutes to get?

That’s where opportunity lives.

If you’re thinking about starting a business in 2026 and want help pressure-testing your idea, I’m always happy to walk through it with you. Reach out to me Erika at SmallTownWOWShop@gmail.com

Let’s build something that lasts.