Social media is a breeding ground for budding entrepreneurs and was the most popular online platform to start and market a business in the past 12 months, according to a new study. 361,768 new businesses were started on social media sites in 2020 – equivalent to 991 start-ups per day.
As many as 259,003 businesses were started on Facebook and Instagram in the past 12 months, and 66,839 new enterprises started on Twitter. The insights were published as part of The Boom or Bust: Beginning a business in a pandemic report published by The Accountancy Partnership, which revealed the extent to which the nation’s entrepreneurs are harnessing the power and reach of free social-media platforms.
The video-sharing platform, TikTok, popular with Generation Z and Alpha age groups, was also home to as many as 35,926 new businesses in 2020 as eCommerce boomed during a year of lockdown restrictions. LinkedIn and Pinterest were also highlighted by hundreds of businesses as platforms they first adopted.
The hashtags #supportsmallbusiness and #shopsmall have been used 36.1 million and 42.1m times respectively on Instagram highlighting the appetite for buying from start-ups via social media.
At the same time, Shopify, the enterprise eCommerce platform, increased the number of new retailers by 106%, with the website now hosting a total of 120,000 British businesses, including GymShark, one of Britain's most recent £1billion start-ups.
Lee Murphy, managing director of The Accountancy Partnership, said: “Small businesses are thriving on social media sites where owners can reach large audiences of potential customers as well as seek out niche interest communities and offer their products and services for free.
“Many businesses that have started online the past 12 months have experienced considerable growth, and as a result require more stringent and professional business practices in place such as accounting and HR. While being an entrepreneur is an exciting experience, navigating some areas of business can be difficult and require a detailed knowledge. Twinned with potential financial penalties for missing tax and account deadlines, business owners should use the support of experts where possible to help them thrive and scale.”
The retail sector was the most popular for start-ups in 2020, with more than 22,000 new business registrations. The ability to begin trading online with just a social media account or website rather than large outlays for bricks and mortar stores have propelled new entrants despite many high street names struggling.
The management consultancy sector also saw 16,869 businesses added to its industry as the home-working revolution boosted those starting out. The same conditions also paved the way for the creation of 9,064 IT consultancies.
9,062 takeaway food shops, dark kitchens and mobile food stands were also able to harness technology like Deliveroo, Just Eat and Uber Eats to launch their businesses online in 2020.