UK start-ups are demonstrating the greatest survival rates in three years, according to the Barclays and Business Growth Fund (BGF) Entrepreneurs Index, a bi-annual series tracking the UK entrepreneurial lifecycle.
The index, which began tracking entrepreneurial trends in 2012, found the number of active companies in the UK increased to 3,260,879 in June 2015, up from 3,139,630 in December 2014. This rise of 3.86% is the biggest uplift since the index began tracking this data. In a further sign of the UK’s healthy start-up scene, the report found that between December 2014 and June 2015, the number of company dissolutions was lower than in the previous six months – the first time this has happened since the index began – reversing a three-year trend.
Key findings include:
- Exits: Number of deals resulting in individual wealth creation of £200,000 or more continued to rise, up by 5%
- Growth: However, proportion of high-growth firms continued to decline
- Sectors: The services sector saw the biggest rise in the number of deals, followed by financial services, computer software and industrial sectors
- Regions: Wales and the South West outperformed the rest of the UK in proportion of high-growth companies
Dena Brumpton, Head of Wealth Management, UK at Barclays, said: “These results are particularly encouraging as the business landscape in the UK is changing, with a relatively small number of small and medium sized enterprises delivering a significant impact on economic growth, employment and wealth creation. Since 2012, the appetite for creating new businesses has grown exponentially, due to a number of factors – from an improving economy, to the rise of entrepreneurs over the age of 50.”
She added: “The report shows that there is an opportunity to replicate the success of the start-up scene at the scale-up stage, to enable a greater proportion of UK businesses to achieve high-growth ambitions. The industry needs to do more to support this segment which is why we are leading the way by offering a unique proposition for high-growth firms, providing access to a range of innovative funding, services and networks for the most ambitious businesses driving economic growth.
“Barclays is committed to supporting high-growth businesses and their founders throughout their entrepreneurial lifecycle − from start-up to IPO. We are passionate about helping the wealth and employment creators of the future.”
Stephen Welton, Chief Executive, BGF said: “The fact that the first half of 2015 has seen the UK’s biggest rise in the number of active companies since the Entrepreneurs Index began in June 2012, and also the first decrease in the number of these businesses failing is extremely positive.
“It is testament to nationwide efforts to support entrepreneurial activity in recent years, and to the focus on longer-term sustainable growth. We need to continue to invest in ambitious British businesses in order to contribute to the health and robustness of the UK economy.”