Most of the people (82%) who would like to start their own business fail to make it to the planning stages, despite having a start up idea. This is one of many findings from the latest RBS Enterprise Tracker, research designed to track people’s attitudes and ambitions towards starting up a business. The survey is conducted by Populus in association with the Centre for Entrepreneurs.
Over one third (34%) of the public would like to start their own business, but only 4% are in the process of doing so. Even though 36% of would-be entrepreneurs have an idea for a business, only 15% have made it as far as the planning stages.
Knowing the right people is critical for encouraging entrepreneurship
Entrepreneurial role models are an important trigger for those starting a business. 57% of potential entrepreneurs with a business idea personally know someone who has set up a business. But among those who have taken the next steps to actually set up their business, 72% personally know an entrepreneur.
The prevalence of role model influence is especially true for those defined as “high potential individuals” who are starting up a business, with 77% knowing someone who is an entrepreneur. High Potential Individuals are those who are those most likely to become successful entrepreneurs, identified in research by the Social Market Foundation.
Among all aspiring entrepreneurs, 31% have a family member and 36% have a friend who has started a business. Family and friends not only serve as inspiration, but as a key source of advice. Nearly half (47%) of would-be entrepreneurs say these groups have helped them plan or develop their business.
Aspiring entrepreneurs struggle to find sources of support
Findings from the survey raised concerns around the need to increase awareness of the available support for those who want to start and grow a business.
Over half (55%)of the public say they don’t know where to get information about starting a business locally. This lack of awareness has remained persistently low since the tracker began in April 2012.
There is a huge gap between the support individuals would find useful and the support that they know about, with almost half (47%) of aspiring entrepreneurs say they aren’t aware of any support that exists in their local area. For example, over half of all individuals who would like to start their own business or enterprise would find financial advice useful, yet only a quarter are aware of financial advice being available in their local area. Similarly, awareness of mentoring is very low (7%) compared to almost half of potential entrepreneurs who say this would be useful (44%).
Thom Kenrick, Head of Community Programmes, RBS said:
“This research indicates this knowledge-gap is holding back a huge swathe of potential entrepreneurs from pursuing their start-up dreams and worryingly more than half the population don’t know what support is out there to help their dreams become a reality. RBS is committed to supporting business from the spark of an idea through to successful business. Every year we invest in free support for potential entrepreneurs across the UK through our enterprise hubs, start-up surgeries and mobile business bus to name a few. Through Inspiring Enterprise alone we have invested £3m of funding to over 100 enterprise support organisations.”
Commentating on the survey findings, Matt Smith, Director of the Centre for Entrepreneurs said:
“This research proves that role models play an important part in inspiring people to turn their ideas into action. We should celebrate those who put in the effort to build businesses and create jobs, ensuring that knowledge of their achievements reaches a critical mass. This will help demonstrate that entrepreneurship is a serious and laudable career goal.”