Fear of failure prevents UK workers starting up

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Mark Prisk launches new Business Link services to support entrepreneurialism and business growth

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Mark Prisk launches new Business Link services to support entrepreneurialism and business growth

A quarter of the working population believes there are good opportunies to start up new businesses where they live[i], but a fear of failure could prevent one in three workers from starting up on their own[ii]. New insights show that, if this fear could be overcome, the UK economy could benefit from an injection of millions of pounds.

The new insights, revealed as Business and Enterprise Minister Mark Prisk launches Business Link's new online services, demonstrate that if only 1% of these UK workers overcame their fear and seized the opportunity to start-up in their local area, the UK economy could receive a boost of over £33 million, if each individual made a profit of £1,000. If 5% overcame their fear and took a leap into entrepreneurialism, then the injection would be £163 million, and if all of them took the leap, the benefit would be £3.25 billion.[iii]

The research also shows that 47% of UK workers believe they have the skills, knowledge and experience to start a business and that 31% of people know someone who has started a business in the last two years[iv].

To help both entrepreneurs to start-up and also people looking to improve and grow their businesses, Business Link has launched two new services - a Start-Up Service, called My New Business, and the Growth and Improvement Service.

My New Business is aimed squarely at those people who are in the early stages of starting a business. It provides a wealth of information including more than 100 videos, and 100 elearning tutorials and tools; as well as further guidance for getting a business up and running, from writing business plans to securing funding.

The second new product for businesses - the Growth and Improvement Service - provides straightforward, practical guidance for people who want to get more out of their business: such as generating more sales, increasing profits, and saving time and money. The support, tools and short knowledge bites help established businesses quickly deal with business challenges, from practical, day-to-day tasks to more strategic guidance on business development and expansion.

Business and Enterprise Minister Mark Prisk said:
"The Business Link services unveiled today will give businesses new, easy to use, and tailored online services.

"This represents the most effective and efficient way to provide the information and advice businesspeople tell us they need and will help businesses grow.

"Interactive tools and services provide real benefits and support to start-ups and SMEs and I am looking forward to seeing these new services put to good use."

Ray Lambe, Director, Business Link, said:
"The UK has a rich history of entrepreneurialism, but this research shows that one of the major barriers to starting up is fear. My New Business been designed, using feedback from our customers, to help people to overcome the fear of going-it alone and have the confidence to start up. This service will guide entrepreneurs through the start-up process, from deciding whether they have what it takes to be their own boss, to looking for finance and developing ideas and business plans. We have also developed a new Growth and Improvement Service to help people looking to develop and expand their businesses."

You can find the new services at [i 26.8% of the working age population who are not entrepreneurially active (i.e. are neither nascent entrepreneurs nor existing business owner/managers). Data source: Hart & Levie, Global Entrepreneurship Monitor, UK 2010 Monitoring Report

[ii] 36% of the working age population who are not entrepreneurially active (i.e. are neither nascent entrepreneurs nor existing business owner/managers) who also believe that there are good start-up opportunities where they live. Data source: Hart & Levie, Global Entrepreneurship Monitor, UK 2010 Monitoring Report
[iii] There are 40,537,000 people aged 16-64 in the UK. (ONS data 26/10/11).

Figure 3 in the GEM UK 2010 report shows that in 2010, a total of 83% of the UK adult population had either 'no (entrepreneurial) activity or intention'. From this we can calculate that 83% of 40,537,000m, or 33,645,710 adults in the UK, are not currently entrepreneurially active.
Those who believed that there are 'good start-up opportunities where they live' (26.8%) AND cited 'fear of failure' as a reason that would prevent them starting a business (36%):
33,645,710 x 26.8% = 9,017,050
9,017,050 x 36% x (0.36) = 3,246,138
If 3,246,138 people did start a business that made £1,000 profit in its first year, the economy would benefit to the sum of £3,246,138,101 or £3.25bn
If 1% took the leap, and made £1,000 profit in their first year, the economic injection would be: £32.5 million
If 5% took the leap, and made £1,000 profit in their first year, the economic injection would be: £162.5 million
Please note, the estimate of £1,000 profit is a conservative estimation because many small business reinvest the profits that they make
Data source: Business Link analysis based on Hart & Levie, Global Entrepreneurship Monitor, UK 2010 Monitoring Report and Office for National Statistics 2011

[iv]Data source: Hart & Levie, Global Entrepreneurship Monitor, UK 2010 Monitoring Report

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