1 In 10 Brits Plan To Start A Business In The Next Year, Reports Find

A new report from Block says that 1 in 10 people in Britain want to start a business in the next year. This comes to more than 5 million people and the report says the number of businesses in the country would almost double if all of them went ahead. Block calls the study the Entrepreneurship Revolution report and it was carried out with Public First.

Younger adults are steering this change. Block says 67% of 18 to 34 year olds are thinking about starting a business or are already interested in doing so. The report says this group is turning away from traditional employment and is putting more weight on independent work. Many young adults are also working on their own ideas at home which is helping this shift.

Block says this rise could bring large gains for the economy. The report says that if an extra 1% of small firms lifted their productivity in a way that brought revenue up faster than headcount, it would bring £24.6 billion into the economy each year. Block presents this as evidence of the financial value behind helping new founders grow.

How Much Of This Growth Is Coming From Side Hustles?

The report says 15% of people in Britain already run a side hustle. Block also says 13% take extra work such as tutoring or babysitting to top up their income. Many see these activities as early tests for bigger ideas and the report says this could lead to a rise in new companies if people can grow these projects into full time work.

Younger adults stand out again. Block says nearly two in five people aged 18 to 34 have started a business or a side project. The study also says more than two thirds in that age group are thinking about working for themselves. Many use flexible jobs or skills they already have to start low cost ventures which give them more room to try new ideas.

Block says ethnic minority groups play a strong part in this trend. A quarter of people from ethnic minority backgrounds run a side business and 23% want to start a business in the next year. The report suggests this group is becoming a driving force in Britain’s enterprise culture and may lift the number of new companies faster than expected.

There is also a difference between men and women in the younger age group. Block says 29% of women aged 18 to 34 have started a side business or full business, compared with 42% of men. This gap shows that growth is spread unevenly across groups even though interest in self employment is high.

What Is stopping These Projects From Growing Faster?

Block says 19% of those who run a side project do not want to turn it into a full time job. This means most would like to build something larger if they could. Many say they need better tools and more support to take the next step. According to the report, 37% want better access to finance and 30% want better software or payment tools. Another 30% want help with marketing and reaching an audience.

Finance stands out as the largest barrier for people who want to grow. Block says the UK has the highest small business loan rejection rate in Europe. More than 50,000 small firms with low default rates are turned away each year which costs the economy £4 billion. This leaves many founders stuck even when they have a workable idea.

Block says meeting the finance needs of those rejected firms could bring £7.4 billion into the economy every year. The report describes this as an overlooked opportunity that could turn early ideas into stable firms with strong revenue growth.

What Do Experts Say?

John O’Beirne, CEO of Squareup International, at Block, said: “The ambition to start and grow businesses is there, but many entrepreneurs still find the financial system stacked against them. Access to fairer and more flexible funding provides entrepreneurs with the freedom to start and scale their businesses, manage cash flow, and invest in growth. When small businesses can plan ahead and access the resources they need, they build stronger local communities and contribute to the wider economy. Ensuring Britain’s next generation of entrepreneurs can reach their potential ultimately feeds into Britain’s overall economic health. ”

The research highlights the role flexible finance can play in unlocking this potential. While traditional loans remain out of reach for many small businesses, the data shows that flexible funding linked to sales can support growth – with over half of Square sellers surveyed saying their experience accessing finance through Square is better than other lenders.2

Rich Bayer, CEO at Clearpay, at Block, said: “If just an additional 1% of SMEs were able to boost their productivity to the point where revenue was growing faster than headcount, it would contribute an additional £24.6 billion to the UK economy each year. This is a huge untapped opportunity. Access to innovative digital solutions, like payment tech, are critical to help these businesses scale up profitably at a time when consumers expect a choice of payment methods at the checkout.”

Calculations within the report show how modern payment tools, like Buy Now, Pay Later, are contributing to the bottom line of businesses by helping them to gain new customers and retain existing ones. In 2024, BNPL enabled £6.6 billion worth of sales revenue that would not have happened in its absence.

Gaya Vara, Founder of Gaya Bakery and Clearpay merchant, said: “I began baking as a hobby and creative outlet while working in finance and this quickly evolved into a full-time business as commissions for special occasion cakes grew. Today, customers can order a range of products from us – everything from our in-store pastries, as well as desserts and larger celebration cakes. Our online store has been instrumental in that growth. It allows customers to browse our full range, place orders with ease, and gain a sense of what defines our work – boutique, made-to-order cakes that combine exquisite flavour with refined, elegant design.

“Running a physical shop brings a different set of challenges, but I remain a firm believer in the value of in-person retail. There’s a distinct charm in customers stepping through our doors – seeing the cakes up close, breathing in the delicious aromas of freshly-baked pastries, and connecting with us in person – an experience no online platform can ever replace.”