What Brexit? The majority of entrepreneurs are hunting fresh funding in 2018

Lynsey Barber
Follow Lynsey
More entrepreneurs outside London are chasing higher amounts of funding (Source: Getty)

The majority of entrepreneurs across the UK are planning to raise cash in the next 12 months, with those outside of London signalling the greatest ambition.

Across the country, around one in five said they were looking for more than £10m in funding, according to EY's Fast Growth Tracker, compared to only six per cent in the capital.

Read more: Leaving so soon? UK founders lack big tech exit ambitions

More than half of founders in both London and the rest of the country are setting their sights on raising up to £5m, the survey of nearly 400 entrepreneurs from EY's Entrepreneur of the Year programme found.

A similar proportion said that raising cash was the largest constraint on their growth. Three in five business owners have already raised cash in the past 12 months, while 40 per cent said they found the process a distraction from actually running their business.

“Funding has historically been, and continues to be, a hurdle to growth for the country’s entrepreneurial businesses," said EY fast growth platform partner Richard Goold.

The findings also indicated that founders are turning to investors from abroad. 62 per cent said they were actively targeting backers from overseas while 39 per cent said they were unable to find suitable investors in their previous round of funding.

Read more: The number of startups run by older entrepreneurs has surged in 10 years

"This research shows a disparity between matching ambitious enterprises with suitable investors, leading many to look overseas to find the growth capital they need," said Goold

"To make our startups a British business success, more routes to funding need to be created to ensure that these bright, entrepreneurial businesses are enabled to flourish."

It comes as separate figures, seen exclusively by City A.M. , show seven in 10 small businesses are confident about doing business in the UK despite Brexit and other uncertainties.

A survey of more than 1,000 small firms by Square, the payments firm founded by Twitter co-founder Jack Dorsey, indicated confidence when it comes to hring, expansion and investment. They expect their businesses to grow 29 per cent in the coming year, which would see them outperform the wider economy.

Read more: Fintech startup MarketInvoice is getting into small business lending

Several locations were also found to be ahead of the capital when it comes to business confidence. London ranked 10th, with Belfast, Cardiff and Edinburgh ahead when it comes to growth projections.

“Much of the conversation about economic growth focuses on London and big business, but, interestingly, this research shows that it’s small businesses from all around the UK that are driving economic optimism," said UK lead for Square Sarah Harvey.

Related articles