Starting a new business venture can be tough, no matter your age or experience. It takes a lot of drive and hard work to stand out in the market and make your company a success.
Despite the challenges of launching a new company, there are thousands of entrepreneurs all over the UK that have set up a business in the past year. Some industries have fared better than others, such as the services industry which makes up three-quarters of all businesses in the UK.
Cloud accounting company Ember analysed more than 400,000 records from Companies House over the past year to discover the common traits among the UK’s latest business owners, including the most common age range for new business owners, as well as the most popular location for a new business.
The following data gives an insight into the themes and trends of the UK’s newest entrepreneurs over the past year.
Which generation has the UK’s leading entrepreneurs?
Research has found that nearly half of the UK’s newest entrepreneurs are Millennials. 227,000 businesses were set up by 25 to 40-year-olds since July 2020, which translates to 49% of new businesses.
People aged between 41 and 56, otherwise known as Generation X, make up a third of new business owners. Baby Boomers (people aged between 57 and 75 years old) have set up 9.6% of new businesses, whilst Generation Z (aged between 16 and 24 years old) only counted as 7.8% of new entrepreneurs.
The data also shows that a higher proportion of Generation Z have started new businesses compared to the Baby Boomers. 0.51% out of 7 million Generation Z have set up a business, whereas only 0.33% of 13.5 million Boomers have.
How many small businesses are there in the UK?
The UK government classes a company that has less than 250 employees as a small business. There were 5.9 million small businesses at the start of 2020. This saw an increase of 113,000 businesses from the previous year.
In 2020, 3.5 million businesses were registered as sole traders. This means that 59% of the UK private sector business population fall into this category.
2 million businesses (34% of the business population) are classed as actively trading companies and 414,000 (7%) were ordinary partnerships.
What is the most popular type of new business?
Unsurprisingly in this digital era, the most popular type of new business is e-commerce. More than 26,000 new companies registered as ‘Retail sale via mail order houses or via Internet’.
The second most popular class that new businesses registered as was ‘Management consultancy activities other than financial management’. 14,000 new businesses registered in this second group.
The third most popular type of new business is ‘Other service activities n.e.c.’. This category covers businesses such as pet sitting services, tattooists and even pavement artists!
There has been a 72% increase in businesses in the last 20 years, with 2.5 million businesses having formed since 2000.
Which location has the highest number of new businesses?
Five of the six most entrepreneurial places in the UK are London boroughs – Ilford, Dagenham, Romford, Hayes and Southall. Ilford has 1.5663% of its population starting new businesses, which is the highest percentage in the UK.
Manchester and Dagenham came in at second and third respectively. Manchester has a population to new business ratio of 1.4043%, whilst Dagenham has a ratio of 1.2942%.