Launchpad for growth as 468,000 new companies start up
In a sign of the strong potential of the UK economy, 468,000 new firms have started up in the first half of 2024, according to the New Startup Index by Beauhurst and supported by NatWest.
This brings the number of companies operating in the UK to 5.47m, with new businesses primarily operating in wholesale, retail and professional services as of June 2024. The UK has experienced a significant uplift in new businesses in recent years, with numbers growing from 173,000 in the first quarter of 2020 to 248,000 in the first quarter of 2024—marking a 43.4% increase.
Across the UK regions, London led the way in the first half of 2024 with 161,000 new business incorporations, the highest across all regions. The regions of the West Midlands and Yorkshire and The Humber also experienced notable growth rates of 10.1% and 8.15%, respectively.
This coincides with new analysis by Beauhurst which shows that businesses on NatWest’s free accelerator programme are more likely to generate higher turnover growth, raise more investment and have better survival rates than other similar businesses.
Businesses on NatWest’s accelerator programme stand a greater chance of raising investment which rose by 70.5% on average over a three-year period, according to data published by the bank. Accelerator businesses also recorded turnover growth that was on average 35% higher than other similar businesses. And in an environment where just over half of start-ups typically survive the first three years in business, 9 out of 10 businesses on the NatWest accelerator were still trading three years later.
Paul Thwaite, NatWest Group CEO, said: “The UK’s potential for growth is made clear by the numbers of people now starting their own businesses. Small businesses are the lifeblood of our economy, accounting for three-fifths of employment and about half of the private sector’s turnover. If these new businesses are given the right conditions to succeed, they could significantly boost the UK economy.
“Across the UK, NatWest Group is helping more businesses get started than any other bank. We play a key role in giving start-ups the tools to scale and succeed – with data from our accelerator showing our support significantly boosts businesses’ turnover, investment and chances of survival.
“This September we are taking our commitment to small businesses up a level by over doubling the amount of free places on our Accelerator programme, to 2,500 businesses. We are creating the environment where businesses have the support, guidance and conditions they need to thrive – because when small businesses succeed, the UK succeeds.”
Business and trade secretary Jonathan Reynolds said: “Our mission is to bring economic growth and make the UK the best place to start-up and scale-up business. However, we can only achieve this by working in partnership with the private sector.
“That is why it’s good to see accelerator schemes like this play a positive role in giving businesses the boost they need to invest and grow, and it’s exciting to see these figures show signs of optimism for our start-up sector.”
One business given the NatWest accelerator boost is online retailer Foudys. Helen Hardy set up Foudys, the first and only official retail platform in the world dedicated to women’s football merchandise, from her bedroom in Manchester in 2020. Within two months, she had quit her job and become a full-time entrepreneur.
Helen was grappling with the demands of running a young business when she applied to join the NatWest accelerator in Manchester. It was there that she met Jess Grocutt, an acceleration manager at the Manchester hub, who became her mentor and what she calls the ‘biggest catalyst’ for achieving her goals. Joining the programme was also a turning point for Foudys, with Helen securing her first round of investment. Within a year, Foudys had a contract with Nike.
Helen said: “Being an entrepreneur is a bit like being an elite sportsperson – it requires an incredible amount of mental resilience. Having people around who encourage you to keep moving towards your goals is really important. The belief that NatWest showed in me was a massive confidence boost.
“I needed investment to grow my business and NatWest was a huge part of that process. My mentor, Jess, supported me figure out how much I would need and then said ‘let’s do a mock pitch with real investors’. I pitched Foudys to three investors and one of the investors in the room was ‘the one’.”
Henry Whorwood, managing director at Beauhurst, said: “Certain aspects of the economy are firing on all cylinders. UK entrepreneurs are still starting lots of new businesses. This may mark the beginning of a new normal with higher rates of entrepreneurship in the UK economy than known previously.”
