Member Article

London startups receive 30% more government funding than UK average

Startups in London receive 30% more government funding than entrepreneurs in the rest of the UK according to research published today by University College London’s School of Management.

The study, which also looked at factors including broadband speed and the cost of central office space, found that London’s entrepreneurs accessed on average £1,038 per new business.

This figure is 30% more than the next highest-placed city Sunderland, where startups accessed on average £720 worth of funding per new business, and dwarfs government funding levels in Leicester where the average was just £132 per new business.

However, despite the average levels of funding enjoyed by the capital’s entrepreneurs, London still finished second behind Bristol, which was named Britain’s capital for new businesses by the study.

The cost of London’s office spaces are the highest in the country at £52.50 per sq ft per month and, with rents expected to rise even further this year, can prove a major hurdle for new businesses.

Commenting on the findings, Chris Coleridge, Director of the UCL MSc in Technology Entrepreneurship, commented: “A great business idea is just the start of succeeding as an entrepreneur, and we’ve found some surprising differences in the facilities available to them across the UK.

“The factors we have explored, from basic funding to broadband speed, can have a real impact on the direction and growth of a business as it gathers pace.

Due to the discrepancies in the quality of amenities across the UK, Coleridge cautioned startups to do their homework and added: “Entrepreneurs whose aim is to start a business this year should invest plenty of time in the planning phase, in order to research the pros and cons of not just their product or service, but of their hometown in order to counteract any hurdles.

“Business networking groups and collaboration with other local entrepreneurs shouldn’t be overlooked, as it can help with knowledge and insight sharing particularly in the early stages.”