The 10 Most Popular US States for Foreign Investors

The USA is by far the world's largest destination for foreign direct investment. But which states that money actually flows into is rarely answered cleanly, because almost every list uses a different measure and none of them tells you which one.

We'll say it up front: this page ranks states by first-year expenditures of foreign direct investors, as reported by the U.S. Bureau of Economic Analysis (BEA), added up across 2024 and 2025. That is money that demonstrably changed hands, not money someone announced. The dataset was published on June 10, 2026, which makes it the most recent complete state-by-state comparison available.

1The number that explains everything else

Before you look at the ranking, here is a number most site-selection brochures leave out. Of the $232.2 billion foreign investors spent in the USA in 2025, $218.4 billion went into buying existing US companies. Establishing new operations accounted for $4.6 billion, and expanding existing ones for $9.2 billion.

Put differently: around 94 percent of foreign direct investment in the USA is acquisitions, not new businesses. In 2024 the ratio was practically the same. So when you read that a state is "the most popular with foreign investors", it usually means companies were bought there. It does not mean conditions there are especially good for building a new operation. For you as a founder, this is the most important distinction on this page, and we'll come back to it below.

2The 10 most popular US states

First-year expenditures of foreign direct investors, 2024 and 2025 combined, in billions of dollars. In parentheses: the number of people employed in 2025 at the newly acquired, established or expanded US operations.

1. California: $73.1 bn (37,200 employees)
2. Texas: $43.5 bn (16,500)
3. Illinois: $29.0 bn (17,600)
4. Massachusetts: $25.0 bn (4,600)
5. Pennsylvania: $22.5 bn (12,800)
6. New Jersey: $20.7 bn (2,800)
7. Michigan: $17.6 bn (8,600)
8. Georgia: $17.2 bn (3,700)
9. North Carolina: $15.1 bn (5,300)
10. New York: $12.9 bn (7,400)

2.1California

California is back on top, and by a wide margin. In 2025 alone, $59.7 billion flowed into the state, more than into places 3 and 4 combined. Older rankings had Texas in the lead. That was a different year and a different measure.

What stands out is the mix: 98.8 percent of California's total is acquisitions. California is where foreign groups buy American companies, not where they build factories. For the price of a California software house, you can get a whole plant somewhere else.

2.2Texas

With $43.5 billion across both years, Texas is the only state that attracted more than $21 billion in both 2024 and 2025, so no one-off outlier year. More important for you: with $2.76 billion in new establishments and expansions, Texas is the second-strongest greenfield location in the USA after Louisiana, and the only one that combines this with a large acquisitions market. No state income tax, a deep labor market, ports on the Gulf. Mount Bonnell Advisors is based in Austin, and we say more about it under Texas as a US location.

2.3Illinois

Illinois draws double-digit billions in both years and, with 17,600 employees, even beats Texas on jobs. Chicago is the hub of America's heartland, with rail freight, food processing and machinery. Its greenfield share of 0.1 percent, however, is the lowest in the field: here companies buy, they don't build.

2.4Massachusetts

The newcomer on this list. In 2025, $19.2 billion flowed into Massachusetts, almost entirely into acquisitions. The reason is the concentration of biotech and pharmaceutical research around Boston and Cambridge. If you're a European company looking to buy American research capacity, this is where you buy it.

2.5Pennsylvania

Pennsylvania shows the most striking jump: $1.6 billion in 2024, then $20.9 billion in 2025. A single year with one very large deal can catapult a state up these statistics. That is exactly why we add two years together and show both figures separately.

2.6New Jersey

The mirror image of Pennsylvania: $18.9 billion in 2024, just $1.8 billion in 2025. New Jersey has the highest population density in the USA, sits right behind the Port of New York and has long been home to the pharmaceutical industry. The low headcount of 2,800 stands out: a few very expensive companies were bought.

2.7Michigan

In 2025, Michigan attracted $15.6 billion, more than in previous years. The state is, and remains, the center of the American auto industry, and the shift in drivetrain technology keeps the supplier market moving. For European suppliers, Michigan is where the customer is.

2.8Georgia

Georgia contributed the larger share in 2024, with $16.3 billion. The Port of Savannah and the investments along Interstate 85 have made the state a manufacturing hub of the Southeast. But the headcount of 3,700 tells the same story here: capital-intensive, not labor-intensive.

2.9North Carolina

The most interesting state on this list if you want to build rather than buy. With $1.47 billion in new establishments and expansions, North Carolina has a greenfield share of 9.7 percent, the highest among the top ten and well above the national average of around 6 percent. Behind it are Research Triangle Park, with its dense cluster of biotech and pharma, and investments across the wider state.

2.10New York

New York rounds out the list with $12.9 billion. The state is a financial center and a base for North American headquarters, not a production location. If you need a representative office, you'll find everything here. If you're looking for a legal structure with low running costs, run the numbers on New York carefully: the state has its own income tax of 4 to 10.9 percent, and New York City levies a local one on top.

3If you want to build rather than buy: a different ranking

Look only at new establishments and expansions, which is what a European mid-sized company actually does when entering the market, and the picture flips completely. First-year expenditures for newly established and expanded operations, 2024 and 2025 combined, in millions of dollars:

1. Louisiana: 2,956
2. Texas: 2,760
3. Arizona: 2,749
4. Wyoming: 2,601
5. New Mexico: 1,600
6. North Carolina: 1,472
7. Delaware: 1,367
8. Virginia: 1,028
9. Florida: 1,024
10. California: 897

Louisiana, Arizona, Wyoming and New Mexico don't appear in the overall ranking at all, yet they lead for new construction. These are locations with cheap energy, plenty of land and active economic development policies. If you're planning a production site, a warehouse or a data center, this is the list that matters to you, not the one above.

4Where the money comes from

In 2025, Japan led the source countries with $50.5 billion, measured by ultimate beneficial owner. Next came Germany with $26.7 billion, followed by Canada with $23.5 billion. Europe as a whole accounted for $116.6 billion, or 50.2 percent of all foreign direct investment in the US, and Asia and the Pacific for $71.9 billion.

Europe is the largest source of direct investment in the US. You're in excellent company with your plans, and on the ground you'll find an advisory and supplier network that knows how to work with European companies.

By industry, the largest share in 2025 went into manufacturing: $121.8 billion, or 52.5 percent of the total. Within manufacturing, publishing led with $50.7 billion, followed by chemicals with $45.4 billion and plastics and rubber products with $19.0 billion.

5What these numbers don't tell you

Three caveats you should know before basing a location decision on them:

• One year is not a trend. A single billion-dollar acquisition can move a state ten places. Pennsylvania and New Jersey are both examples of this in the list. That's why we use two years, and why we show both individual figures.
• Inflow is not stock. First-year expenditures measure what's new. What already exists, the BEA measures separately: majority foreign-owned US affiliates employed about 8.57 million people in the US in 2024, or 6.1 percent of all private-sector employment. This figure comes from the release of 10 July 2026 and barely changes from year to year.
• Popular doesn't mean cheap. California and New York rank near the top, even though both are among the most expensive and tax-heavy states. There, capital follows the target company, not the tax rate.

6What this means for your US market entry

For most of our clients from Europe, the key takeaway on this page is the 94 percent figure. The typical foreign direct investor in the US is a corporate group buying an American company. That's not you. You're starting a business, and different criteria apply: tax burden, availability of staff, proximity to customers, and the effort of ongoing compliance.

What's more, the state where you register your company doesn't have to be the state where you do business. These are two separate decisions with different criteria, and we cover them under Which US state is the best location and State and legal structure.

Read on: our overview of foreign direct investment in the USA puts the legal framework in context, from reporting requirements to CFIUS review. If you want to know where people are moving rather than capital, see Where in America is the best place to live. And for the tax side of your market entry, head to tax considerations for market entry.

Data as of: U.S. Bureau of Economic Analysis, New Foreign Direct Investment in the United States 2025, published 10 June 2026 (tables 3 and 18, first-year expenditures and employment by state, data years 2024 and 2025); BEA, Activities of U.S. Affiliates of Foreign Multinational Enterprises 2024, published 10 July 2026. Next update with BEA data year 2026 in June 2027.

In short

• The ranking follows first-year expenditures by foreign direct investors as reported by the U.S. Bureau of Economic Analysis, combined for 2024 and 2025.
• About 94 percent of foreign direct investment in the US is acquisitions of existing companies, not new businesses.
• California, Texas and Illinois lead. Texas is second only to Louisiana for new establishments and expansions.
• If you want to build rather than buy, the list looks different: Louisiana, Texas, Arizona and Wyoming lead for new construction.
• In 2025, Europe accounted for about half of all direct investment in the US, with Germany the second-largest source country after Japan.

How we help you

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