Britain’s lost opportunity: New research reveals more businesses would be launched if people could find someone to do it with.
Helping people to find a co-founder would unlock the potential of UK entrepreneurship with millions more people likely to become entrepreneurs if they had someone to set up business with, new research from Octopus Group reveals.
One in three (33%) Britons have considered becoming an entrepreneur and a higher proportion (40%) agreed that having a co-founder would allow them to take the leap and start a business.
Those who are currently considering starting a business in the near future were even more positive about the impact a co-founder could make. Seven in ten (70%) prospective entrepreneurs agreed that a co-founder would allow them to take the leap and set up their own business.
Realising the full potential of start-ups
Not only do co-founders make it easier to start a business, but they are also seen as making a material difference to the future success of the company. Almost 9 in 10 (87%) entrepreneurs with co-founded businesses said that having one has made their business more successful.
Entrepreneurs without a co-founder also recognised the huge potential benefit, with more than three quarters (76%) saying that a co-founder would have made their business more successful.
The value of moral support
Entrepreneurs with a co-founder said the crucial benefit is the moral support they offer, and having someone to share the burden and anxiety that comes with launching a business. Almost twice as many (37%) entrepreneurs selected this as number one benefit compared to any other. Providing the confidence to set up the business and bringing a complementary skill set were equal second (19%).
Simon Rogerson, CEO and co-founder of Octopus, said:
“Taking that leap and leaving corporate life becomes a hundred times easier when you have a co-founder. It gives you a bizarre comfort blanket when everyone around you is telling you that you’re mad and the idea won’t work. It becomes the two of you against the world, which is much less lonely, and far less scary.”
While acknowledging the huge benefits of having a co-founder, the strains of starting a business were also clear when entrepreneurs were asked about stress. Almost two in five entrepreneurs (39%) said that the relationship with their co-founder was more stressful than with their life partner, while slightly fewer said it was equally stressful (37%). Only 23% said it was less stressful.
Simon Rogerson added:
“People all too often gloss over the reality of what it means to be an entrepreneur, especially in the early days. The reality is deeply stressful, tough and unglamorous! The relationship with your co-founder is critical to the success of your business. They will be the only person in the world who will feel as passionately about what you are doing. No one else comes close. And you trust them as much as you do your partner. It’s a marriage of sorts.”
Developing entrepreneurial networks across the UK
Not knowing where to find a business partner is a significant barrier to starting a business. One in three (34%) people in the UK wouldn’t know where to look for a co-founder, while 29% would try through family and friends (29%).
According to those entrepreneurs who have already set up a business, the most common way of meeting a co-founder was through friends of family (29%), followed by business connection apps (23%) such as LinkedIn, and connections from work (17%).
Chris Hulatt, co-founder of Octopus, commented:
“The importance of entrepreneurship in driving UK economic growth is well known. Our research reveals that there are thousands of potential entrepreneurs out there in need of someone to help them take the plunge and start their own business. But not everyone is lucky enough to meet that person through their existing network. We can and should do more to encourage prospective entrepreneurs to come together and discuss ideas and ambitions. That’s when businesses are born.”
Philip Salter, Director of The Entrepreneurs Network, commented:
“Ensuring entrepreneurship continues to flourish across the UK is critical to our economic prosperity. The latest research from Octopus reveals just how important it is for entrepreneurial networks and local ecosystems to be nurtured. The growth of incubators and accelerators, as well as co-working spaces, is making it easier for entrepreneurs to find co-founders and launch new businesses. However, more could be done outside London to help entrepreneurs share ideas and get the support they need.”
Matt Clifford, CEO and co-founder of Entrepreneur First, comments:
“At Entrepreneur First we bring together exceptionally talented individuals specifically to help them find a co-founder to partner with and build a globally ambitious tech company.
“Since 2011 more than one thousand people have joined the EF community and we’ve funded more than 150 companies. Over this time, we’ve learned that co-founders who offer complementary skill sets and a clear division of roles are phenomenally valuable when building a business. Although mutual respect and support are just as important.
“We truly believe, and are founded on the principle, that there are many, many people who could start globally important companies if they could find the right co-founder for them.”
Alex Petrides, co-founder of allplants, comments:
“Founders often suffer from anxiety and imposter syndrome, so finding that special person to start a business with is important. It’s also very difficult. JP and I had the advantage of being brothers and knowing we had a complementary skill set. The real difference in having a co-founder is the confidence boost, moral support and having someone to talk to. As the company grows and your crazy idea takes off, you’re laying the tracks while driving the train – so the right support is key.”
Freddie Blackett, CEO and co-founder of Patch, comments:
“It was clear that for Patch to succeed it was going to have to solve two fundamental challenges. One was brand and marketing while the other was operations and delivery. Having a co-founder has allowed each of us to tackle these individually, while improving our strengths. It’s fair to say that without Ed we’d have had no chance of success, nor would Patch have been able to scale as well and as quickly as we have.”
Katie Massie-Taylor, co-founder of Mush, comments:
“Mush was born when we struck up a conversation in a rainy playground, both looking after two small kids. We had separately considered starting our own businesses – but helping new mothers tackle the loneliness we had felt became a shared mission. We would never have become entrepreneurs without a co-founder to help get it off the ground, and building a successful company as a duo turned out to be way more fun that we could have hoped. We brought complimentary skills to the table and had each other for moral support, but above all we shared the same values and were twice as effective at getting things done. We probably rely on each other more than we do our husbands in day to day life now!”
Tessa Cook, co-founder of OLIO, comments:
“Having a co-founder is like having a superpower. We couldn’t imagine going on the exciting but daunting journey of launching a business without one. In many ways we’re like peas in a pod, but in others we’re incredibly different; however together we’re definitely stronger. Some people, including our partners, didn’t always see OLIO’s potential, so having a co-founder when everyone’s doubting you makes you feel slightly less crazy! Alone we probably couldn’t solve the problem of food waste, but together we most definitely can.”
Tom Valentine, co-founder of Secret Escapes, comments:
“Finding the right co-founder can be fundamental to the success of your start-up. It made Secret Escapes possible because we each brought essential complementary skills and industry knowledge to the table, as well as a strong shared commitment. Successfully scaling a company isn’t easy, but the benefits of being co-founded have increased over time. In the last eight years being able to share the load has been invaluable. More businesses would probably be set up if people knew where to find suitable co-founders. Early stage funding is a very important lever to grow the pool of potential co-founders.”
Notes to Editors:
About the research
The research was carried out by Survation, on behalf of Octopus Group in October 2018. The surveys were conducted online with sample sizes of 1030 of the general public, 512 of prospective entrepreneurs and 522 of existing entrepreneurs. Survation is a member of the British Polling Council and abides by its rules.
This press release is issued by Octopus for use by journalists in their professional capacity and should not be relied upon by retail clients. The value of investments, and the income from them, may fall or rise. The information in this document should not be construed as offering investment or tax advice. Issued by Octopus Group: November 2018.