£100M support delivered to back next generation of business owners

Since 2012, over 15,000 "Start Up Loans", amounting to more than £100 million, have been awarded to young entrepreneurs aged 18-24. These loans are part of a government-supported finance initiative facilitated by the British Business Bank, which has disbursed over £1 billion to small and medium-sized enterprises (SMEs) across the country since the scheme's inception.

The Start Up Loan Scheme offers critical support to young individuals aspiring to establish a small business, a demographic that typically faces challenges in securing finance from traditional sources. The scheme has proven to be an effective route to employment, with nearly one-third of recipients in the 18-24 age group moving out of unemployment as a result.

Out of all loans granted to entrepreneurs under 25, 39% were allocated to female business owners, and 24% to owners from ethnic minority backgrounds. Geographically, the North West has seen the highest number of loans (1,992), with the West Midlands (1,591) and the South East (1,291) following. Since 2012, London has received a total of 3,099 loans.

The most common sectors for business launches among loan recipients include retail (£8.5 million), hospitality (£5.8 million), and arts and entertainment (£2.5 million).

The Help to Grow Campaign has been revamped to provide a comprehensive resource for SMEs seeking information on starting, scaling, and growing their business. The newly updated website consolidates government support into a single platform, streamlining access to essential resources for business leaders and aspiring entrepreneurs.

Recognising the challenges faced by first-time young entrepreneurs, the government has introduced a detailed guide on setting up and expanding a business in the UK on the Help to Grow website, marking a first in the initiative's history.

Small Business Minister Kevin Hollinrake said: “Every large firm started off as a small business and today’s aspiring young entrepreneurs could be the next success story. I urge them to explore how a Start Up Loan could launch their ambitions today.

“Through the British Business Bank, and the Help to Grow campaign, we’ve backed the next generation of business leaders with over £100 million in government backed finance and we’re not stopping there.”

The single biggest way it is backing businesses is by creating the economic conditions for them to thrive, which is why the government is working hard to deliver on priorities to halve inflation, grow the economy and cut debt. We’ve made significant progress and it’s clear the economy is turning a corner.

The government is also tackling a key issue affecting small firms – late payments. They are determined to make the UK the best place in the world to do business, which is why Minister Hollinrake launched the Prompt Payment and Cash Flow Review in 2023. Since the report was unveiled, they are looking at how to prosecute large firms who persistently and knowingly fail to adhere to the Payment Practice Reporting Regulations.

They’re also backing businesses through the £4.3 billion package to support SMEs with business rates, the Small Business Rates relief taking a third of properties out of paying rates completely, and extending the Retail, Hospitality and Leisure relief for a fifth year, they are helping businesses navigate challenging economic times.

Business owner Cory Hibbin, aged 20, is one of the recipients of a Start Up Loan. He took out a £14,500 loan in March 2023 to launch Techie Services. The company, based in Hastings, offers security solutions for residential clients, estates and corporate buildings, including CCTV, alarm systems and network management.

Cory doesn’t live with family or have any financial support from them so his aspiration of setting up Techie Services would not have been possible without the help of the bank’s funding.

He left school at 16 and started an apprenticeship as an IT engineer at a consultancy firm. After developing his skills, he started offering surveillance services on the side of this day job. The client was so impressed that they asked him to work for them full-time.

Hibbin, founder of Techie Services, said: “I’m not the sort of person who can take on learning from behind a desk so I left school at 16 to do an apprenticeship with a local IT consultancy company. While working there, I was working on the side in the evenings and at the weekends. Having been there for four years, I felt like I had gained enough experience to start my own company, which is when Techie Services began. I started with one large client, who quickly recommended me to other businesses and individuals, so I took on five new clients in our first six weeks.

“It hasn’t been easy but it’s the best decision I’ve ever made. The money from Start Up Loans was invaluable in the success of the business - I used it to buy tools for installations as well as supplies for the office. While it might seem a big leap of faith to some people, you can’t let the fear of failure stop you from trying in the first place. I urge anyone 18 or above to look into the finance options available to them if they need a hand getting off the ground.”

Richard Bearman, Managing Director, Small Business Lending, British Business Bank said: “It’s amazing to see people in their late teens and early twenties with such ‘can-do’ attitudes and motivation to achieve success in working life.

“Our £100 million funding milestone is a significant landmark and testament to the hard work of Start Up Loans, ensuring anyone with a good business idea like Cory’s, no matter their age, has the access to the funding needed to bring it to life. The impact of this on communities across the UK has been huge and we’re determined to keep backing aspirational young people with money and mentoring.”