How British Entrepreneurs Benefit From Today’s Economy

You wouldn't guess it from the doom-and-gloom headlines, but UK entrepreneurs are having something of a moment. Despite (or perhaps because of) the country's economic growing pains, startups are sprouting, funding is flowing, and parts of the green economy are quietly turning into job factories.

The question is whether this optimism can outlast the politics.

Startups Are Rising

It's been long since "entrepreneurial boom" and "North East England" shared the same sentence, but here we are. In the first half of 2025, 10 UK regions posted double-digit growth in new business registrations, according to NatWest's latest report. Nationally, over 426,000 new firms were launched. This is a 15% jump on the same period last year.

Regional growth numbers include:

• North East: +19% year-on-year startup growth
• Scotland: +17.9%
• West Midlands: +16.9%
• North West: +16.5%

This isn't a coincidence. The shift away from London-centric growth has been in motion since the pandemic. The economic draw of remote-first models, cheaper overheads, and local innovation clusters (hello, Manchester) is clearly bearing fruit.

But before we declare a northern economic renaissance, let's see whether these startups survive their first year.

Green Economy

The green economy is becoming a rare consensus winner in a country still arguing about wind farms and ULEZ zones.  According to the Environmental Change Institute, green industries delivered £83.1 billion in gross value added in 2024, up 10% year-on-year. Not bad for a sector that, until recently, was reserved mainly as a PR line for oil majors and political manifestos.

The multiplier effect is also enormous. For every pound added to green GVA, another £1.89 ripples through the wider economy. That sort of multiplier doesn't go unnoticed by investors, and certainly not by entrepreneurs who have grown weary of crowded SaaS markets and post-Brexit fintech fatigue.

And this isn't just solar panels. Nissan's EV36Zero gigafactory (an electric car and battery production hub in Sunderland) is expected to support 6,200 jobs and pump £1 billion into the regional economy. What's more interesting is the ecosystem that is forming around this sector. Battery recyclers, low-carbon materials startups, and software firms writing energy efficiency tools are all becoming a thing.

Elsewhere, you can see green logic creeping into unexpected corners. In construction, modular firms are pitching zero-waste builds. In food retail, refillable grocery models are quietly replacing plastic-heavy chains on urban high streets. There's a modest boom in second-life electronics. It's still capitalism, though, just with a carbon budget.

None of this would be happening without the money, of course. And money is now flowing into green tech thanks to the UK Infrastructure Bank's £22 billion pot for net-zero initiatives, coupled with a £4.5 billion clean energy manufacturing package announced earlier this year.  

Private Equity

If you're wondering who's bankrolling all this optimism, look to the usual suspects. UK private equity and venture capital-backed companies now employ 2.5 million people, up 17% since 2023, and generate £199 billion in GDP, roughly 7% of the entire economy.

And despite a few headline-grabbing failures, the risk appetite hasn't disappeared. Deal activity might not be at 2021's frothy levels, but funds like BGF are still allocating around £3 billion over the next five years, including targeted funds for female-led ventures.

Whether that's enough to compensate for the Brexit drag remains to be seen. But for now, founders looking to scale still have a seat at the table.

Fintech and AI

Fintech may have lost some post-pandemic appeal, but the underlying growth is real. Take Zopa, which reported £34.2 million in pre-tax profits, double its 2024 haul—or Allica Bank, which saw profits soar 86% year-on-year.

The government seems to be getting out of the way for once. The support for tech business initiatives like JAX Hub (a bridge for UK fintechs entering the US) signals that Whitehall hasn't entirely given up on tech-led exports.

Meanwhile, AI investment continues to hum. The UK has inked partnerships with Nvidia and Google to train 7.5 million people in AI skills by 2030. Whether that becomes a reality or another well-meaning white paper is anyone's guess.

GDP Rebounds, but Investor Sentiment Lags

Now for the macro view. Despite political uncertainty and persistent inflationary anxiety, UK GDP posted 2.2% growth in H1 2025, the strongest among G7 economies.

The FTSE 350 surprised, too. Profits exceeded expectations by 16.5%, driven mainly by consumer resilience and recovering exports.

So why aren't British investors joining the party? That's the paradox. Domestic capital remains cautious, spooked by the memory of volatility and policy churn. You can see it in the flows, the fund allocations, and the sentiment indicators plastered across TradingView dashboards. Ironically, overseas investors seem more willing to bet on UK resilience.

Good, but Fragile Gains

Let's not kid ourselves; this isn't a golden era for UK business. Cost pressures, labour shortages, and Brexit red tape are still very real. Despite upbeat forecasts, the IMF pegs UK growth at 1.3% for the year, with room for downside surprises.

Still, there are signs of life. Net-zero sectors are expanding, and the rise in regional startup activity suggests that British entrepreneurs are adapting faster than policymakers.

As for the government, the task is simple: don't make things worse. Or better yet, offer help where it matters, and then get out of the way.