A new study by GoDaddy has revealed a significant shift among young entrepreneurs, with those under 30 who set up businesses straight after A levels—without attending university—now twice as prevalent as the national average. The research suggests a growing trend of forgoing higher education in favour of immediate entrepreneurial ventures.
The Venture Forward study, which draws on data from over half a million digital microbusinesses in the UK, shows that while only 11% of entrepreneurs across all ages started their businesses immediately after A levels, this figure rises to 22% among those under 30. This shift appears to be driven by both the high cost of university education and the lower barriers to starting a business.
Economic Factors Influencing Decisions
The study highlights a generational change in attitudes towards higher education, especially following the 2012 increase in university tuition fees and ongoing high interest rates on student loans. The financial burden of a university degree seems to be prompting many young people to consider entrepreneurship as a more viable alternative.
Among entrepreneurs who did not attend university, 76% expressed relief at avoiding student debt, and 49% believe their earnings are comparable to those with a degree. In contrast, less than half (46%) of university-educated entrepreneurs feel their degree has significantly contributed to their business success. Additionally, 34% of these entrepreneurs believe starting their business earlier would have been more beneficial.
Impact of the Pandemic
The COVID-19 pandemic has also played a role in this shift. The disruption to traditional university experiences, including reduced contact time with tutors and the loss of social interactions, seems to have influenced some students to pursue alternative paths. Nearly half (47%) of microbusinesses owned by individuals without a degree were established post-2020.
Lower Barriers to Entry
The barriers to starting a business have decreased significantly in recent years. Many young entrepreneurs report setting up their businesses for £500 or less, with almost a quarter (23%) requiring no start-up capital at all. This ease of entry is supported by the availability of online resources and tools that streamline the business setup process.
Andrew Gradon, Head of GoDaddy UK & Ireland, commented on the findings, “Our research shows that entrepreneurship is increasingly seen as a viable alternative to higher education. With rising costs of university education and innovative tools available to simplify business setup, young people are more inclined to start their own businesses.”
Confidence Among Non-Degree Entrepreneurs
The study also reveals that entrepreneurs without a degree exhibit high levels of confidence regarding their business prospects. Sixty percent of non-degree entrepreneurs are optimistic about commercial growth this year, compared to 57% of those with a university education. Similarly, 59% of non-degree entrepreneurs expect an increase in financial turnover in 2024, versus 55% of their degree-holding counterparts.
Gradon added, “Our insights suggest that higher education is not a prerequisite for entrepreneurial success. Those who skip university and dive straight into business are proving to be just as capable and confident in their growth prospects.”
The findings reflect a broader trend towards valuing practical business experience and entrepreneurial spirit over traditional academic paths, indicating a significant shift in how young people view the route to career success.