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Improving Birmingham Startups’ Survival Rate

Associate Professor Thomas Domboka, Head of the Business Department at Birmingham City University (BCU), discusses Birmingham’s increasing popularity as a startup hub and how Birmingham startups can access valuable support.

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Improving Birmingham Startups’ Survival Rate

Associate Professor Thomas Domboka, Head of the Business Department at Birmingham City University (BCU), discusses Birmingham’s increasing popularity as a startup hub and how Birmingham startups can access valuable support.

The regional startup capital of the UK

In January 2021, Birmingham was crowned the UK’s regional startup capital for the seventh year running. 18,394 Birmingham startups began life in 2020, with a 26.8 percent uplift in business births from 2019.

People may be surprised at this, but when you assess the reasons why, it makes perfect sense.

Birmingham is turning into a mega city. It is well-serviced by a good and efficient local transport system, with most suburbs within 30 minutes from the city centre.

HS2 will also provide Birmingham startups with the opportunity to get to London within 50 minutes.

Unlike London, Birmingham is far cheaper to live in and to run a business.

New regeneration projects – such as the £700 million Paradise project in Chamberlain Square and the revamp of Alexander Stadium – are only adding to its appeal.

Birmingham is also one of the most diverse cities in the UK with a large migrant population.

Research shows that migrants have a greater propensity to start their own business than people born in the area.

It’s a city with an ethnically diverse population, communities and experiences that offer a wealth of talent.

What challenges are Birmingham startups facing?

According to Embroker (2021), 90 percent of startups fail, with 70 percent closing between years two and five.

Birmingham, sadly, is no exception.  

There are a number of reasons why startups struggle, most notably:

  • Lack of funding: Many startups start their business without sufficient working capital to sustain the business – JP Morgan Chase Institute estimates that the average startup only has 27 days of cash in reserve.
  • Lack of planning: When launching a startup, people often overlook the importance of effective business planning prior to starting operations, and don’t have a business model that distinguishes them from their competitors.
  • Not monitoring the market: Marketing intelligence is essential for any business, including monitoring competitors and customer behaviour. Many startups mistakenly think this is just for large businesses.

What support for startups is available?

There are a number of services available at BCU that can provide assistance for small businesses.

The recently-relaunched STEAMhouse Incubator offers immediate access to a host of support opportunities, including:

  • One-to-one business start-up advice, ongoing mentoring and support, and business startup workshops;
  • Access to facilities and support, including dedicated workstations, meeting rooms and a collaborative workspace;
  • Business plan development support.

When launching a startup, it’s vital that you can consider seeking assistance from a business incubator.

According to research by the National Business Incubation Association, companies nurtured in a business incubator have a survival rate of 87 percent, compared with just 44 percent for unassisted enterprises.

Meanwhile, the BSEEN business startup service can provide you with assistance in shaping your business plan, a dedicated business mentor, and help accessing grant and funding opportunities.

The Greater Birmingham Chamber of Commerce, which teaches new entrepreneurs a range of business skills, also provides support.

Birmingham startups could also look further afield, with both Startup and Business Gateway providing financial support and valuable advice.

Entrepreneurs for the Future also supports startups by providing them with a platform to refine their ideas, and launch their products and services.


If you would like to learn more about the STEAMhouse Business Incubator or would like to apply for membership, please click the button below.

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