Having a social impact rather than making money is more likely to encourage millennials to run businesses, according to The Co-op Bank’s research
Launching a business is no easy task. However, given how more millennials believe starting a business is a better investment than going to university, it’s easy to see how they are increasingly choosing entrepreneurship. Not only are they more interested in becoming business owners but they prioritise ideas that benefits communities, according to research by The Co-operative Bank.
The research revealed how 7% of UK businesses are owned by someone aged under 35. Of those youth-owned companies only 11% cared about making sales and 29% were more likely to make a difference in people’s lives. This is a clear contrast to entrepreneurs over 35 where 57% were primarily concerned about their profit margins. Moreover, SMEs owned by younger generations are three times more likely to care about their local community, with 27% aiming to create more jobs compared to business owners over 35.
Commenting on these figures, Ryan Etchells, head of SME banking at The Co-operative Bank said: “As our society has progressed, our understanding of what makes a good business has evolved along with it. It makes sense that the next generation of entrepreneurs would value highly their impact on community and the lives of their customers, over purely being driven by their own bank balance. We need to do more to encourage these purpose-led businesses to flourish.
Indeed, more entrepreneurs are launching social enterprises which not only benefit people in their lives but also help them achieve their business goals. For instance, Twitter and Square CEO Jack Dorsey announced a collaboration with The Entrepreneurial Refugee Network during his visit at the London Tech Week which will help refugees get easier access to technology and training to launch their companies. “We want to make sure anyone and everyone can pursue their entrepreneurial ambitions,” said Dorsey. Agreeably, millennials must take inspiration from this initiative and bolster the UK’s entrepreneur ecosystem.
While being a business owner is preferred by the Generation Y, they look for purpose over profits. And, we’re sure to say they’re on the right track.