Annual UK Business Start-Up Review

With more and more people moving on from your typical 9 to 5 jobs and following their dreams, start-ups in the UK have exploded in recent years. So we decided to compile a list of the essential facts we could uncover regarding start-ups' success.

How many businesses are there in the United Kingdom as a whole?

• 82 million micro-businesses (0-49 employees).
• 35,600 medium-sized businesses (50 -249 employees).
• 7,700 large businesses (+250 employees)

How many businesses are classified as SMEs?

• SME businesses account for 99.9% of all companies, with 5.9 million operating.
• Small and medium-sized businesses employ three-fifths of the workforce.
• SME enterprises also account for more than half of all UK company turnover.

Where are the SMEs in the United Kingdom?

• According to GOV.uk figures, London tops the list with 1.1 million.
• Then the South East is in the second position, with 940,000.
• As a result, the South-East of England has been the most successful in establishing private-sector businesses. This area is home to more than one-third of all businesses in the United Kingdom.
• The North East has the fewest companies of any English area, at 152,000.

How many start-ups are in the UK?

• According to annual GOV.uk figures, between 500,000 and 700,000 new start-up businesses are created in the United Kingdom each year.
• In the private sector of businesses in the United Kingdom, the business population expanded by 3.5% (+200,000 companies) over the previous year.
• London had the greatest business birth rate (15.9%), while the North West had the highest business death rate (13.5%).
• Since 2000, the average yearly growth rate in the start-up population has been +3 %.

How many new businesses fail in the United Kingdom?

Dissolvency took 508,865 businesses between the years 2018 and 2019. Of course, not all are start-ups, but given that roughly 20% of businesses fail in their first year, we should anticipate around 130,000 of these to be start-ups, implying that around 26% of dissolved businesses are in their first year.

How many companies fail in their first year?

Creating a company entails taking a significant risk of failure. Approximately 20% of businesses fail in their first year, and approximately 60% fail within their first three years.

Why do businesses fail?

CBInsights surveyed 101 start-up workers and founders to determine why those businesses failed.

38% Cashflow

Money and time are limited resources that ought to be handled wisely. One of the most common causes for failure was a lack of funds, an inability to get financing/investor interest, closely followed.

35% No market need

In 35% of situations, tackling exciting challenges rather than those that satisfy a market need took the No. 2 spot for the cause of failure.

20% Got outcompeted

Despite the common wisdom that entrepreneurs should not be concerned about competition, the fact is that if a concept becomes popular or receives market validation, others may attempt to profit from the opportunity. While worrying about competition is unhealthy, ignoring it was a formula for failure in 20% of start-up failures.

19% Flawed business model

Most unsuccessful companies agree on the need for a business model - sticking to a single channel or failing to develop methods to earn money at scale made investors wary and founders unable to capitalise on any traction acquired.

18% Legal and compliance

A company may sometimes expand from a basic idea into a world of legal complexity that might eventually lead to its demise.

15%  Pricing/cost issues

Regarding company success, pricing is a black art, and start-up post-mortems emphasise the challenge of pricing a product high enough to pay costs yet low enough to attract users eventually.

14% Not the right team

Staff diversity with varied skillsets was frequently recognised as crucial to a company's success. Failure post-mortems frequently moaned, "I wish we had a CTO from the beginning," or that the business had "a founder who liked the business part of things."

The answer is Simplicity

Are you one of the 38%  struggling with funds? Simplicity is here to help. We provide 100% funding for temp and permanent recruitment businesses. So whether you have one or 100+ workers, Simplicity's scalable funding pays your workers and you, your margin - every week – without fail.

Please feel free to contact us on 01594 888518 to learn more about our recruitment finance solution. Or download a copy of our financing brochure.

Recruitment start-up hub: REGISTER FREE TODAY

The Recruitment Start-up Hub partners with a wide range of experienced suppliers in the recruitment industry. Providing recruiters with the expert knowledge required to get started and run a successful recruitment business. With FREE access to hints, tips and guides about starting and running your own - all in one place.

Find out more about the Recruitment Start-up Hub here: https://www.recstartuphub.co.uk/