Start-ups defy recession

Microsoft, Hewlett Packard and General Electric were all founded during slumps - proving the tenacity of great business ideas.

Now the latest figures show that UK entrepreneurship is thriving even in these hard times.

Despite the high profile recession casualties of last year, there were 46,000 more businesses than in 2007, according to the Office for National Statistics. James Blackburn, co-founder of energy sustainability company Carbon GC, was one of those enterprises.

‘We started the business last year because carbon reduction is a bit of a buzz phrase for companies at the moment and there’s a huge amount of government legislation being passed in terms of what they need to adhere to – so it’s a sector with a lot of growth potential,’ he says.

Although the green agenda has gained some momentum as companies strive to reduce utility costs, Blackburn concedes that the economic climate has affected his company’s growth.

‘Because we are in an expanding sector, we were prepared to launch at a difficult time. We felt that if we gained a foothold in the market now, we’ll be in a really good position for when the upturn comes,’ he adds.

Daniel Yates, founder of, was also undeterred by talk of an economic meltdown. Instead he saw a market gap created by the recession and decided to launch the camping comparison website in July last year.

‘It’s something I had been thinking of doing for a while. Then with so many people holidaying in the UK last summer, the market suddenly became very buoyant and I didn’t want to miss out on that opportunity.’

Yates says he is in the fortunate position of being in two growth areas: e-commerce and budget UK travel. ‘A lot of people are rediscovering the pleasures of their family holidays and what the UK has to offer in terms of tourism. I think that’s something that’s being driven by the recession but will continue to grow. Bookings for staycations are already over 60 per cent up for next year.’

John Wright, national chairman of the Federation of Small Businesses, a lobbying group, says it is still a tough climate for SMEs, but believes that for budding entrepreneurs, now is a great time to start a business.

‘There will be gaps in the market that serial entrepreneurs can spot and fill. With unemployment at record levels, these new firms will also be key to tackling rising unemployment. As a small business grows, it will be looking to recruit and will be in a prime position to do so after the recession.’

Wright is optimistic about next year. ‘With interest rates at an historic low, banks beginning to lend again and customers seeking value for money, there is definite potential in the air for innovative enterprises to have a good 2010,’ he adds.

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