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Manchester city center skyline.

These are the BEST cities to start a business, according to a new study

After such many challenging years for businesses across the UK, Instant Offices has analysed Companies House data to work out which UK cities are fighting back with the strongest entrepreneurial spirit?

Instant Offices analysed the population to startup ratio across the country’s top cities to discover which locations saw the highest concentration of entrepreneurs in the last 12 months. The data revealed the top locations for entrepreneurs launching new ventures.

Manchester came out on top as the UK’s most entrepreneurial city, with a 23% increase in the number of businesses registered in 2021. This means one company was registered per every 31 people living in the city.

Which cities are the best to start a business in?

The data showed that after Manchester, Preston and Doncaster are in the second and third positions. Both of these cities have seen significant growth in business over the past two years since the pandemic started.

City %Growth(YoY) Population Companies started in 2020 Companies started in 2021 Entreprenurial Index
Manchester 23.9 554400 14083 17442 3.15%
Preston 24.6 99198 2316 2889 2.91%
Doncaster 26.9 114900 2416 3067 2.67%
Bedford 1.9 92405 2172 2214 2.40%
Stockport 12.3 110000 2080 2336 2.12%
Oldham 3.3 105402 2114 2184 2.07%
Salford 20.4 116361 1928 2321 1.99%
Milton Keynes 14.8 184105 3021 3469 1.88%
Bolton 21.6 202369 3090 3756 1.86%
St Albans 28.1 86961 1311 1597 1.84%

Which cities are the worst to start a business in?

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The worst place to start a business at the moment is Derby followed by the likes of Rayleigh and Hastings. Although they’ve all had a good percentage of growth YoY, other cities surpass them.

City %Growth(YoY) Population Companies started in 2020 Companies started in 2021 Entreprenurial Index
Sunderland 30.4 175031 865 1128 0.64%
Reading 12.3 229274 1259 1414 0.62%
Kingston upon Hull 27.9 288671 1342 1717 0.59%
Hartlepool 14.3 89610 442 505 0.56%
Plymouth 17.1 241179 993 1163 0.48%
Sale 3.1 137915 573 591 0.43%
Birkenhead 9.4 144756 513 561 0.39%
Hastings 18.5 93592 271 321 0.34%
Rayleigh 17.2 98809 232 272 0.28%
Derby 9.8 263933 518 569 0.22%


Ecommerce businesses are thriving the most in the UK

But what types of businesses are thriving in the UK at the moment and how many have been started in the past year? Well, it looks like Ecommerce and Real Estate have taken the top spot.

The widespread switch to remote working and online shopping fuelled a digital transformation in the UK. This has also given aspiring entrepreneurs the final push needed to start their own businesses from home.

Type of Company Number Registered In The Past 2 Years 
Retail sale via mail order houses or via Internet 69,016
Buying and selling of own real estate 56,519
Other letting and operating of own or leased real estate 49,436
Management consultancy activities other than financial management 48,494
Other service activities n.e.c. 38,115
Freight transport by road 34,868
Other business support service activities n.e.c. 33,573
Development of building projects 27,617
Information technology consultant activites 26,418
Construction of domestic buildings  20,943


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