The pandemic has been the core reason for some 26 per cent of new businesses opening this year, with most owners confident in turning a profit their first 12 months.
The Covid-19 crisis has provided a ‘unique’ opportunity for entrepreneurs, according to new research from fintech firm Tide.
With 65 per cent of fresh business owners saying they are confident their business will turn a profit in the next 12 months, it appears the pandemic has permanently changed UK business.
Both this year and last year saw a surge in the number of new businesses being formed, with lockdown giving many the opportunity to rethink their work lives.
There were 21.8 per cent more businesses incorporated in the UK in the year to March 2021 compared to the previous year, according to data from Companies House.
Over two-thirds of new business owners are first-time entrepreneurs, Tide’s data found, with over half of businesses being full-time occupations rather than ‘side-hustles’.
“It’s hugely encouraging for the UK economy to see that the majority of these businesses will be their founders’ full-time occupations and that there is a lot of confidence that they will be financially viable,” Tide CEO Oliver Prill said.
Setting up a new business is a real test of character, and the challenges posed by the pandemic will compound this, however, with the economy opening up again and lockdowns looking like a thing of the past, there is a real opportunity for this bumper generation of entrepreneurs to be at the forefront of businesses’ re-emergence.”
Surprisingly, just nine per cent of new businesses were opened as a result of losing a job and only three per cent created due to furlough.
Retail and e-commerce was the most popular sector to start a business in, with 13 per cent of new businesses opened in this industry alone.
While construction was the second most popular sector with a fifth of respondents finding the pandemic created an opportunity in this market for their business.