barometer idinvest uk entrepreneurshiponline survey carried out by viavoice on behalf of idinvest...

FEBRUARY 2017

UK Entrepreneurship

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“I’M MOTIVATED BY THE WORLD OF TOMORROW AND HOW THAT WORLD WILL TAKE SHAPE”Didier Rapport, Co-Founder and CEO of HAPPN

"UK IS A TIER 1 MARKET FOR US. IT IS NOT ONLY A VERY FLEXIBLE AND COMPETITIVE MARKET, THAT REQUIRES FROM US EXCELLENCE, BUT IT IS ALSO A VERY IMPORTANT HUB FOR EXTRA-EUROPEAN MARKETS IN OUR AREA"

Jean Canzoneri, Co-Founder and CEO of Ogury

“I WANTED TO WORK WITH MY HANDS AND BE RECOGNIZED FOR WHAT I WAS DOING MY OWN WAY ON THE JOB. I DIDN’T WANT TO SPEND MY TIME

IN FRONT OF A COMPUTER DOING WORK THAT EVERYONE ELSE COULD DO”Pete*, Gourmet Restaurant Founder

"THERE HAS NEVER BEEN A BETTER TIME TO START A VENTURE IN THE UK. THE CUSTOMER BASE IS LARGE, THE TALENT POOL RICH, AND THE

ENTREPRENEURIAL ECO-SYSTEM VIBRANT. THE GOVERNMENT IS ALSO VERY SUPPORTIVE, WITH INITIATIVES SUCH AS THE ENTERPRISE INVEST-

MENT SCHEME AS WELL AS ENTREPRENEURSHIP VISAS TO CONTINUE TO FUEL THE GROWTH OF THE TECH SCENE. WE'VE BEEN ABLE TO BUILD

OUR IDENTITY VERIFICATION SOLUTIONS USING MACHINE LEARNING ENGINEERS FROM THE BEST UNIVERSITIES IN THE UK AND AT THE SAME TIME PILOT OUR TECH WITH FLAGSHIP CLIENTS BASED IN THE FINTECH

CAPITAL OF EUROPE - LONDON. " Husayn Kassai, Co-Founder and CEO of Onfido

“THE BRITISH ENTREPRENEURIAL CLIMATE IS AS HOT AS EVER, WE'RE A NATION OF CREATIVE THINKERS WHO VALUE HARD WORK, AMBITION AND AREN'T TOO KEEN ON HAVING A BOSS. IT'S DISAPPOINTING THAT WE'VE CHOSEN TO DISTANCE OURSELVES FROM EUROPE BUT I'M NOT SURPRISED THAT BUDDING UK ENTREPRENEURS AREN'T DETERRED, I DON'T SEE ANY REASON RIGHT NOW WHY PEOPLE SHOULDN'T BE HUGELY OPTIMISTIC ABOUT STARTING THEIR OWN BUSINESS.”Alex Saint, Co-Founder and CEO of Secret Escapes

“THE IDEA WAS TO MAKE MONEY, OF COURSE”Iya*, Founder of an Online Scuba Diving Equipment store

(*) the person wished to remain anonymous

In just a few decades we have witnessed a huge change in the public mind-set. Entrepreneurs have confirmed their position on the world stage and received recognition for the crucial role the entrepreneurial spirit plays in supporting both economic and social progress. However, we cannot ignore the still significant challenges facing the next generation of entrepreneurs. Issues such as financing and economic security can not be overlooked.

We are heartened to see such a strong entrepreneurial sentiment amongst the British people, and excited to support the growth of the UK companies of the future.

Christophe Baviere, CEO, and Benoist Grossman, Managing Partner

FOREWORD

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TABLE OF CONTENTS

INTRODUCTION AND METHODOLOGY 7

KEY FINDINGS 8

PART 1 : THE ENTREPRENEURIAL ENVIRONMENT 12ENTREPRENEURIAL MOTIVATION 12AGE AND EXPERIENCE 13ENTREPRENEURSHIP IN THE UK 14UK START-UP ENVIRONMENT 15POST-BREXIT ENVIRONMENT 16

PART 2 : THE PROFILE OF THE ENTREPRENEUR 17ENTREPRENEURIAL STATUS 17SOURCES OF FINANCING 18SECTOR SPOTLIGHT 19MOTIVATION: LONG-TERM FACTORS 20MOTIVATION: SHORT-TERM FACTORS 21THE FINAL DECISION 22PERSONAL VALUES 23

PART 3 : ECONOMIC CONFIDENCE IN THE UK 24THE BRITISH ECONOMY 24OVERALL OUTLOOK OF THE BRITISH ECONOMY 25UNDERSTANDING SENTIMENT: LOOKING FORWARD 26

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INTRODUCTION AND METHODOLOGY

INTRODUCTION :Idinvest Partners has launched a barometer to track the UK population’s atti-tude towards entrepreneurship.

Our aim is to expose the motivations and the concerns of the population confronted with the idea of starting their own business. The barometer is drawn from a representative sample of 1,500 people, half of which are ‘motivated to start their own business’.

The UK version of this barometer is presented in tandem with the already established French Idinvest Partners Index, which has been published with Le Figaro since 2009.

METHODOLOGY :

Online survey carried out by Viavoice on behalf of Idinvest Partners between 9th February and 15th February 2017. United Kingdom: sample of 1,500 persons, representative of the UK population aged 18 years and over.

Representativeness determined through the quota sampling method to the fol-lowing criteria: gender, age, respondent occupation, region.

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Ten months after the referendum on Brexit, the British economy is stable and British public remains positive, despite the uncertainty on the horizon. At the centre of this optimistic outlook is the nation’s entrepreneurialism, which remains a consistent source of motivation and an essential contributor to the country's economic growth. The Idinvest Partners Index launched today shows that despite practical/financial constraints, the final decision to start a business is a decision of the ‘heart’.

Idinvest Partners and Viavoice have surveyed the UK population to find out:What makes up the DNA of a UK entrepreneur?How strong is entrepreneurial motivation amongst the population?Are they optimistic or pessimistic in a post-Brexit environment? Do they believe that Britain is still the best place to start a business?

KEY FINDINGS

848Idinvest Sentiment Index

February 2

017

53% X 16%PERCENTAGE OF PEOPLE THAT ARE

MOTIVATED TO START THEIR OWN BUSINESS

PERCENTAGE OF UK POPULATION HAVING A DEFINITE PLAN TO START THEIR OWN BUSINESS IN THE NEXT

TWELVE MONTHS

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Key Findings :

• A start up nation: over half of the population are keen to start their own business.

• 3 out of 4 people in the UK aged between 18 and 24 are motivated to become entrepreneurs.

• 60% of people surveyed believe that to start their own business they would need to be at least 30 years old.

• 44% of the population still consider the UK ‘one of the best countries to start a business’. After the UK, Germany is considered the next best place by a strong margin.

• For 47% of the population, traditional sources of funding such as personal savings are still the most likely source of financing.

• 16% of the total population surveyed have a definitive plan to start a business in the next year, which means that currently almost 2 out of 10 people living in the UK will be entrepreneurs by 2018.

• Entrepreneurs are systematically more optimistic than the overall population on issues such as economic growth (+9 points), employment (+8 points), purchasing power (+10 points), and inflation (+9 points).

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The Profile of a British Entrepreneur

Unsurprisingly the overriding motivation behind the British populations entrepreneurialism is to make money (48%), followed closely by the idea of ‘being free and independent’ (47%). However when this question is directed to those who already have a business plan the motivations at play are more nuanced with personal productivity and the strength of business idea taking greater precedence.

Compared to the general population, those motivated to start a business pride themselves on a distinct set of values. They give higher value to hard-work, determination, teamwork, self-confidence, ambition and risk-taking. These results show that British entrepreneurs are united by personal characteristics. Similarly entrepreneurs are shown to be systematically more optimistic than the overall population on issues such as:

• purchasing power (+10 points)

• economic growth (+9 points)

• inflation (+9 points)

• employment (+8 points)

The challenges ahead

When given a list of situational factors to consider and asked if those represent more an advantage or a constraint to start a business in the UK:

• 62% consider ‘uncertainty surrounding Brexit’ as a constraint.

• Whereas a the ‘national economic environment’ (45%) and the ‘current government’s economic policy’ (42%) are an advantage for starting a business in the UK.

The two major concerns for the post-Brexit climate amongst those surveyed are:

• access to the single market (30%)

• the fundraising climate (29%)

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The Funding Challenge

The challenge of funding remains at the core of UK entrepreneurs’ concerns. For 37% of those surveyed ‘financing needs’ are the deciding factor in their final decision to launch a company; followed by the will to succeed and self-confidence (32%).

When confronted with a variety of funding sources, the UK still focuses primarily on traditional sources such as:

• personal savings (47%)

• one or more bank loans (33%)

• public sector assistance (14%)

The British Economy in 2017

Finally, we have surveyed the population about the general mood towards the country’s economic outlook. Despite the potential geopolitical turmoil linked to Brexit, almost 6 out of 10 respondents are optimistic about the British economy over the next twelve months.

Current and aspiring entrepreneurs are also more optimistic and positive about the UK as a land of opportunity for their start-ups:

• 55% consider that the UK is ‘one of the best countries to start a business’ (11 points more than the overall population)

• for the 17% saying that they do not perceive the UK as one of the best countries to start a business, Germany is considered next best country to start a business, followed by Sweden, Switzerland and France.

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PART 1 : THE ENTREPRENEURIAL ENVIRONMENT

WOULD YOU START YOUR OWN BUSINESS CURRENTLY, IF YOU HAD THE MEANS TO DO SO?

53% 41% 6%

YES NO

NO ANSWER

SAMPLE: UK REPRESENTATIVE

ENTREPRENEURIAL MOTIVATION

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AT WHAT AGE WOULD YOU MOST LIKELY BE ABLE TO START YOUR OWN BUSINESS ?

PERCENTAGE OF PEOPLE WHO ARE MOTIVATED TO START THEIR OWN BUSINESS BY AGE:

60% 40%

AFTER 30 YEARS OLD

BEFORE 30 YEARS OLD

SAMPLE: PEOPLE MOTIVATED TO START A BUSINESS

AGE AND EXPERIENCE

65 OR MORE

50-64

35-49

25-34

18-24

34%

48%

66%

70%

76%

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ENTREPRENEURSHIP IN THE UK

COMPARED WITH OTHER MAJOR EUROPEAN ECONOMIES SUCH AS FRANCE, GERMANY, OR ITALY, DO YOU BELIEVE THE UK IS PERCEIVED INTERNATIONALLY AS ONE OF THE BEST COUNTRIES TO START A BUSINESS ?

THE UK IS ONE OF THE BEST COUNTRIES TO START A BUSINESS

AMONG PEOPLE MOTIVATED TO CREATE A BUSINESS IN THE UK

YES : 55 %

THE UK IS NOT PERCEIVED AS ONE OF THE BEST COUNTRIES TO START

A BUSINESS

AMONG PEOPLE SAYING NO, WHICH COUNTRIES ARE PERCEIVED WITH ‘A BETTER REPUTATION TO START A BUSINESS’ ?

YES

NO

DON’T KNOW

NEITHER BETTER NOR WORSE

44% 17% 29% 10%

Germany 52%Sweden 23%Switzerland 18%France 14%Denmark 14%

Germany 46%Sweden 27%Switzerland 22%France 15%Denmark 13%

all respondentspeople motivated

to create a business

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UK START-UP ENVIRONMENT

FOR THE FOLLOWING ITEMS, WOULD YOU SAY THAT CURRENTLY THEY REPRESENT MORE AN ADVANTAGE OR MORE A CONSTRAINT TO START A BUSINESS IN THE UK ?

55 %

49 %

44 %

46 %

45 %

36 %

29 %

+10

+7

+9

+8

+11

+6

+7

33 %

38 %

40 %

42 %

30 %

53 %

59 %

• ADVANTAGE • CONSTRAINT • NO ANSWER

PEOPLE MOTIVATED

TO CREATE A BUSINESS

ADV. CON.

THE UNCERTAINTY SURROUNDINGTHE BREXIT TIMELINE

THE EUROPEAN ECONOMIC OUTLOOK

THE OUTLOOK WITHIN THETARGET SECTOR FOR YOUR BUSINESS

THE INTERNATIONAL ECONOMIC OUTLOOK

THE CURRENTFUNDING ENVIRONMENT

THE CURRENT GOVERNMENT'SECONOMIC POLICY

THE NATIONALECONOMIC ENVIRONMENT

45%

42%

35%

38%

34%

30%

22%

38%

40%

44%

45%

29%

55%

62%

17%

18%

21%

17%

37%

15%

16%

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TOTAL GREATER THAN 100%: MORE THAN ONE ANSWER POSSIBLE

POST-BREXIT ENVIRONMENT

IN LIGHT OF BREXIT, WHICH OF THESE FACTORS ARE YOU MOST CONCERNED COULD IMPACT YOUR DECISION TO SET UP A BUSINESS?


ACCESS TO THE SINGLE MARKET

FUNDRAISING CLIMATE

REGULATORY ENVIRONMENT

INVESTMENT IN INFRASTRUCTURE

CONSUMER SENTIMENT

IMMIGRATION POLICY UNCERTAINTY

ACQUISITION OF TALENT

30%

29%

23%

23%

22%

21%

13%

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ENTREPRENEURIAL STATUS

DO YOU CURRENTLY HAVE A CONCRETE PLAN TO START YOUR OWN BUSINESS THAT YOU INTEND TO CARRY OUT IN THE NEXT YEAR?

ACCOUNTS FOR THE 16 % OF THE GLOBAL UK RE-PRESENTATIVE SAMPLE

29% 65%

YES NO

6%

NO ANSWER


PART 2 :THE PROFILE OF THE ENTREPRENEUR

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SOURCES OF FINANCING

WHICH SOURCE OF FINANCING WOULD YOU LOOK TO ACCESS IN ORDER TO FUND YOUR BUSINESS?

YOUR PERSONAL SAVINGS

ONE OR MORE BANK LOANS

PUBLIC SECTOR ASSISTANCE

CONTRIBUTIONS FROM YOUR RELATIVES

PRIVATE EQUITY FUNDS

OTHERS

NOT SURE AT THIS TIME

NO ANSWER

47%

33%

14%

12%

10%

23%

3%

6%



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SECTOR SPOTLIGHT

IN WHICH INDUSTRY SECTOR WOULD YOU BE INTERESTED IN STARTING YOUR BUSINESS ?



WHOLESALE AND RETAIL TRADE

ARTS, ENTERTAINMENT AND LEISURE ACTIVITIES

INFORMATION AND COMMUNICATION

EDUCATION, HEALTHCARE AND SOCIAL ACTION

HOTELS AND RESTAURANTS

REAL ESTATE ACTIVITIES

SCIENTIFIC AND TECHNICAL ACTIVITES

BUILDING AND CONSTRUCTION

FINANCIAL AND INSURANCE ACTIVITIES

TRANSPORTATION

FARMING, FISHING, FORESTRY AND LOGGING

MANUFACTURING, ENERGY, WATER, MINING

INDUSTRY

23%

22%

14%

13%

13%

9%

8%

7%

6%

5%

4%

3%

3%

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MOTIVATION: LONG-TERM FACTORS

WHY DO YOU WANT TO START YOUR OWN BUSINESS ?TOTAL GREATER THAN 100%: MORE THAN ONE ANSWER POSSIBLE

FINANCIAL SUCCESS

FREEDOM AND INDEPENDENCE

TO MAKE BETTER USE OF YOUR SKILLS AND CREATIVITY

PERSONAL AND PROFESSIONAL GROWTH

TO MAKE A DIFFERENCE TO SOCIETY

A CHANGE IN WORKPLACE OR WORK SITUATION

TO CHALLENGE YOURSELF AND BE EXPOSED TO NEW EXPERIENCES

PASS SOMETHING ON TO FUTURE GENERATIONS

TO BRING AN IDEA OR VISION TO FRUITION

DO SOMETHING DIFFERENT OR CHANGE THINGS

WORK IN A CLOSE-KNIT TEAM

INNOVATE IN YOUR SECTOR

LEAD PEOPLE OR TEAMS

48%

47%

28%

25%

14%

13%

13%

12%

10%

6%

6%

5%

5%

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MOTIVATION:

SHORT-TERM FACTORS

WHAT ARE THE REASONS THAT LED YOU TO PLAN TO START YOUR OWN BUSINESS ?


SAMPLE: PEOPLE HAVING A DEFINITE PLAN TO START A BUSINESS A YEAR FROM NOW

OPTIMISING YOUR TIME EFFECTIVELY AND ENABLING PRODUCTIVITY

AN IDEA FOR A PRODUCT OR BUSINESS THAT YOU FEEL HAS POTENTIAL

EXPECTED INCREASE IN INCOME

PROFESSIONAL EXPERIENCE

STRATEGIC INFORMATION WHICH COULD PROVIDE A COMPETITIVE ADVANTAGE

ANTICIPATION OF A GOOD RETURN ON YOUR INVESTMENT

RAISED THE REQUIRED AMOUNT OF CAPITAL

TARGET MARKET IS DEMONSTRATING POTENTIAL

IDENTIFIED A TRUSTED TEAM OF PEOPLE WITH WHOM YOU CAN WORK

AN EFFECTIVE AND SUPPORTIVE NETWORK OF PROFESSIONAL CONTACTS

A FAVOURABLE ECONOMIC CLIMATE

UNEMPLOYMENT

MAKING PERSONAL SACRIFICES IS NOT AN IMMEDIATE CONCERN

HAVE DECIDED TO CHANGE PROFESSIONS

HAD TO LEAVE YOUR CURRENT PROFESSIONAL ACTIVITY

RECIVED ENCOURAGEMENT TO PURSUE YOUR PLAN TO START A BUSINESS

THE NECESSARY ADMINISTRATIVE PROCEDURES SEEM SIMPLE TO YOU

RECEIVING ASSISTANCE FROM A SPECIALIST ORGANISATION

OBTAINED A BANK LOAN ON FAVORABLE TERMS

NO ANSWER

23%

20%

19%

18%

14%

14%

14%

13%

11%

11%

10%

10%

9%

9%

8%

7%

6%

5%

3%

2%

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THE FINAL DECISION

WHAT IS THE DECIDING FACTOR THAT STANDS BETWEEN YOUR CURRENT SITUATION AND STARTING YOUR OWN BUSINESS?



YOUR FINANCING NEEDS

A WILL TO SUCCEED

A NEW IDEA OR INNOVATIVE PRODUCT TO DEVELOP

THE RIGHT TIMING

A CONCRETE, THOROUGH BUSINESS PLAN

SUPPPORT/ENCOURAGEMENT FROM FRIENDS AND FAMILY

THE RIGHT BUSINESS PARTNER

THE RIGHT TIME ECONOMICALLY OR IN MY INDUSTRY

OTHER(S)

NO ANSWER

37%

32%

25%

23%

19%

17%

17%

12%

1%

5%

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PERSONAL VALUES

WHICH PERSONAL VALUES ARE YOU MOST ATTACHED TO?


SAMPLE: UK REPRESENTATIVE

PEOPLE

MOTIVATED

TO CREATE A

BUSINESS

TOLERANCE AND KINDNESS

HARD WORK

MORALITY AND ETHICS

FREEDOM AND INDEPENDENCE

MODESTY AND HUMILITY

DETERMINATION

TEAMWORK

SELF-CONFIDENCE

ORGANISATION

SHARING

AMBITION

RISK TAKING

NO ANSWER

38 %

39 %

32 %

28 %

23 %

25 %

20 %

17 %

12 %

11 %

14 %

6 %

1 %

+2

+3

+3

+2

+4

+2

42%

37%

34%

30%

24%

22%

17%

15%

12%

11%

10%

4%

3%

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UK REPRESENTATIVE (ALL RESPONDENTS)

OVERALL « OPTIMISTIC » 57 %

OVERALL « OPTIMISTIC » 67 %

PEOPLE MOTIVATED TO CREATE A BUSINESS

THE BRITISH ECONOMY

PART 3 :ECONOMIC CONFIDENCE IN THE UK

10% 10%3%47% 30%

OVER THE NEXT TWELVE MONTHS, HOW OPTIMISTIC ARE YOU ABOUT THE BRITISH ECONOMY ?

• VERY OPTIMISTIC • FAIRLY OPTIMISTIC

• FAIRLY PESSIMISTIC • VERY PESSIMISTIC • NO ANSWER

16% 6%2%51% 25%

+10

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• OPTIMISTIC

• PESSIMISTIC • NO ANSWER

OVERALL OUTLOOK OF THE BRITISH ECONOMY

OVER THE NEXT SIX MONTHS, ARE YOU OPTIMISTIC OR PESSIMISTIC ABOUT… ?

ECONOMIC GROWTH

EMPLOYMENT

PURCHASING POWER

INFLATION

59%

56%

51%

38%

+9

+8

+10

+7

37%

37%

40%

53%

50%

48%

41%

29%

43%

41%

46%

59%

7%

11%

13%

12%

PEOPLE MOTIVATED

TO CREATE A

BUSINESS

OPT. PESS.

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UNDERSTANDING SENTIMENT:

LOOKING FORWARD

The Idinvest Sentiment Index is calculated by multiplying the percentage of people that are motivated to start their own business by the total percentage of UK population having a definite plan to start their own business in the next twelve months. The index will allows us to build a comprehensive picture of how entrepreneurship sentiment in the UK population evolves overtime.

IDINVEST SENTIMENT INDEX FEBRUARY 2017 :

848

FEBRUARY 2017 AUGUST 2017 DECEMBER 2017 OCTOBER 2018MAY 2018

848 ? ? ? ?

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barometer idinvest uk entrepreneurshiponline survey carried out by viavoice on behalf of idinvest...

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