London-based entrepreneurs received more funding from the Start Up Loans company than counterparts in Scotland, Wales and Northern Ireland combined last year, official lending figures have revealed.
A subsidiary of the government-backed British Business Bank (BBB), Start Up Loans was established in 2012 under David Cameron’s coalition government. The funding delivery vehicle provided 1,820 loans worth £9.6m in its first year.
Over the course of 2017, Start Up Loans distributed over £62m in loans to entrepreneurs up and down the UK, across 20 different business sectors, putting its total at £250m to 40,000 startups.
New research from the lender has now revealed where loans were delivered across the country last year, and which sectors were most likely to receive funding.
According to its own data, London hoovered up £11,977,161 throughout 2017 – over £4m more than 2nd place, the South East of England.
Where Start Up Loans were received in 2017
- London– £11,977,161
- South East – £7,963,315
- West Midlands – £7,963,315
- North West – £6,460,348
- South West – £5,276,558
- Yorkshire and the Humber – £5,109,671
- Scotland – £4,786,646
- East of England – £4,186,056
- North East – £4,072,444
- Wales – £3,672,190
- East Midlands – £3,270,311
- Northern Ireland – £778,690
In comparison to the English capital, the combined total of Start Up Loans delivered to enterprises in Scotland, Wales and Northern Ireland reached £9,237,526.
The disparity in funding could simply be a case of demand. In 2016, 22,270 new enterprises were founded in Scotland. In the same period, 102,140 businesses were founded in London, almost a quarter of the UK’s total that year (414,355). Meanwhile, 12,115 startups were founded in Wales and 5,935 in Northern Ireland. (Figures from the Department for Business, Energy and Industrial Strategy)
However, London carries the worst startup survival rate in the UK, according to the Enterprise Research Centre. Only 50.1% of businesses founded in 2013 lasted for three years, 3.6% behind the national average.
Further breakdown of Start Up Loans lending data highlighted specific findings by region.
At £156,600, the North West of England received the most money for takeaways and mobile food stands than any UK region in 2017.
For new hotel businesses, the West Midlands received the most at £89,100. Meanwhile, Yorkshire and the Humber received the most of any UK region for pubs and bars (£87,250).
In Scotland, £244,160 was lent for the hair and beauty industry in 2017.
Commenting on the lending figures, Cameron Bisset, digital content manager for Start Up Loans, said the lender wanted to share its data with the public.
“The interactive showcases where money is lent, and provides a breakdown of the work we do in enhancing business communities nationwide,” Bisset said.
“We have supported more than 40,000 businesses with around £250 million in funding, and the guide illustrates the work we do in making businesses a success in key industries.”
Figures seen by Business Advice, via a Freedom of Information request, revealed that the government-backed Start Up Loans scheme is leaving nearly a third of the entrepreneurs it supports in unmanageable debt.
Start Up Loans provided an interactive breakdown of its funding figures
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