Majority of young people want to start their own business – but cannot name an entrepreneur
A new report, Future Founders: Understanding the Next Generation of Entrepreneurs, has revealed that 51% of British young people aged 14-25 have thought about starting (or have already started) a business. A further third (35%) are open to the idea and just 15% rule it out altogether.
Though young people today show greater aspirations to become entrepreneurs than previous generations, this doesn’t always translate into the creation of new businesses.
To support and nurture the next generation of entrepreneurs, policymakers need to grasp their motivations, ambitions and fears. The Entrepreneurs Network and Octopus Group commissioned ComRes to poll over 1,500 young people (aged 14-25) to better understand what they think about entrepreneurship and how different aspects of the education system affect entrepreneurial intentions.
Barriers to Entrepreneurship
The main barrier to starting a business was “not knowing where to start” (70%). Just two in five (38%) 14-25-year-olds say that their education has given them the skills they need to start a business, compared to a quarter (26%) who say it has not.
Half of the respondents are currently studying at university (51%) or currently studying business (55%) say that their education has given them the skills they need to start up – significantly more likely than non-university graduates, or those studying other subjects. However, this falls to 39% when students graduate, suggesting that some knowledge isn’t transferring from the classroom to the real world.
Women make up just a fifth of UK entrepreneurs, and the survey suggests a lack of role models could also present a significant barrier. 57% of young people could not name an entrepreneur who inspires them. Of those that could, 7.9% named Lord Sugar, 6.5% said Richard Branson, and 2.6% named Elon Musk. Kylie Jenner was the most commonly named female entrepreneur (just 1.1%).
Further – half of young men could name an entrepreneur who inspires them, but only a third (35%) of women could do the same. Of the entrepreneurs who were named, 85% were male.
Past research shows that role models have a greater impact when they are relatable. Closing the gender gap and drawing on a wider range of entrepreneurial talent will require us to champion a more diverse range of entrepreneurs.
But we may also need to change attitudes towards failure if young women – and men – are to create the firms of the future. According to our report, 71% of women and 63% of men cite fear of failure as a barrier to starting up a business.
The findings of Future Founders will feed into the government review, led by The Prince’s Trust, examining how best to tackle the barriers facing the UK’s aspiring young entrepreneurs.
They raised a number of issues for policymakers to consider:
- Britain’s youth are more likely to be motivated by the desire to be independent or to work on something they are passionate about, than by a desire to get rich quick. This should inform the way educators talk about entrepreneurship. Teachers could, for example, discuss with pupils how entrepreneurship can be used to solve pressing social problems.
- Exposure to entrepreneurship is a key driver of entrepreneurial intention. 68% of young people who have a family member or friend who is a business owner say this has made them more likely to consider entrepreneurship as a career. Policymakers should therefore champion the work of organisations that aim to bring founders into schools, such as Founders4Schools, Girls in Charge Initiative, and Young Enterprise.
- In addition, creating a safe space for young people to experiment with starting a business might help build confidence and knowledge, while reducing the fear of failure.
- The government should champion schemes such as the Peter Jones Foundation’s Tycoon Enterprise Competition, where students are lent money to build businesses, but only have to pay it back if they breakeven, allowing them to try entrepreneurship in “a safe and controlled environment”.