The Impact of Young Entrepreneurs in the UK
Andrew Devenport, Chief Executive, Youth Business International, discusses the contribution young entrepreneurs are making to the UK economy and some of the support available to help them grow their businesses.
What are the main challenges facing UK small businesses and entrepreneurs?
In the UK and other developed countries, the first major barrier that entrepreneurs face is an internal one: that of confidence. Everyone has had their own “what-if” moment, when they dream of creating a business that would address a particular problem or make something easier; however, for most people, these moments remain as dreams, because of a lack of confidence to make their idea happen.
What are the particular challenges that young entrepreneurs face? And what are the advantages they have?
Young entrepreneurs need to feel confident enough to take a chance, embrace the risk of failure and do something which many of their friends would not want to do. This can be done through networking with peers, and learning that other similar people have taken the plunge and lived to tell the tale. And once an entrepreneur has started up, a mentor can play a key role in providing moral support and guidance.
But young people do of course have an advantage here over the rest of the population, because many young people do have much more confidence. Taking a chance in your twenties could be much less stressful than doing so in your forties, when you may have a family and a mortgage to contend with.
How can entrepreneurship be best nurtured in young people?
There needs to be a more positive view of entrepreneurship as something that can be attained by anyone, given the right kind of support.
In many countries, entrepreneurship is presented as a poor career choice – something you do if you can’t get a “proper job”. In the UK, on the other hand, we have found that entrepreneurship can be overly glamourised, and presented as a high-risk activity rather than a normal career option. So we believe that presenting a more accurate, balanced picture of what it means to run your own business is vital for developing entrepreneurship, and this is in part what activities like Global Entrepreneurship Week aim to achieve.
How does the UK compare with other economies as an environment for young entrepreneurs? What lessons can the UK learn from other countries, and what can it share with them?
Research that we conducted in 2013, in partnership with the Global Entrepreneurship Monitor, showed that one in five young people consider themselves to be potential entrepreneurs, but only one in 27 actually starts a business. This conversion ratio of potential to actual is far behind countries such as Singapore and China – so it’s clear to us that, whilst awareness of entrepreneurship is high in the UK, more practical support needs to be provided.
We also found that in the UK young people lag behind on high growth business and that fear of failure stands in the way of many young entrepreneurs. On the positive side, however, young business owners were much more positive about how innovative their businesses were, compared to young entrepreneurs in Germany, Singapore and the Netherlands.
Are there any gaps in the support for young entrepreneurs?
We believe that a major challenge in the UK, as well as in many other countries such as Italy, where we recently launched Youth Business Italy, is developing coordinated support. There is a lot of assistance available for young people, but it can be quite fragmented. More joined-up support would mean more effective support, in our view.
There appears to be resurgence in entrepreneurship amongst young people. What factors are driving that?
In the UK and in many parts of the world, this resurgence has in part been driven by need over the past few years. With close to a million young people in the UK out of education, employment or training, young people have needed to be creative and devise their own means for bringing in cash. In Spain and Italy, youth unemployment has been around the 50% mark for several years, forcing young people to consider starting their own business.
Awareness about entrepreneurship is also definitely increasing, and this is leading to more young people deciding to become self-employed. Not just in the UK, but all over the world, entrepreneurship is being championed by governments, businesses, NGOs and the media as an amazing opportunity for young people. We need to harness this increased awareness, to ensure that the next generation makes full use of their entrepreneurial potential.
Which one piece of advice would you give to a young person considering becoming an entrepreneur?
My advice is simply to go for it. It is not going to be easy – there will be ups and downs, but you will learn a lot, gain freedom and take control of your life.