Businesses run by university turned over a collective £1 billion in 2019, according to a new report, as a quarter of students now say they want to start a business while studying.
Creator Fund, Europe’s first venture capital fund to focus entirely on entrepreneurs at university, found that revenues brought in by student-led businesses had jumped 32% since 2016.
The report also found greater diversity among student-run businesses and a greater focus on ‘doing good’. While the rest of the wider business landscape generally continues to struggle with ethnic and gender diversity, student start-ups are finding it no trouble at all. In fact, 43% have at least one founder from a black, Asian or minority ethnic background, and 40% have at least one female founder. It contrasts with the fact that BAME students account for roughly 21% of the student population in the UK, suggesting a particularly strong entrepreneurial mindset.
Despite facing criticism in recent years over their lack of diversity, Oxford and Cambridge had the highest rate of diversity, with 61% of student founders from BAME backgrounds.
There is also diversity in nationality, the report says. While international students account for less than 20% of the student population, 57% of student-run businesses have at least one foreign founder.
Although London is the centre of start-up creation more generally, nearly two-thirds of student-led businesses are created outside of the capital. Cambridge leads the way with 71, followed by Imperial College London on 50 and Oxford 48, meaning the so-called ‘Golden Triangle’ of universities does account for 60% of the total.
There is also evidence to suggest that students are focusing their efforts on areas that benefit the wider world in the future, and steering away from more traditional industries. Healthcare is the most popular area for student start-ups, accounting for 16% of the total, followed by foodtech and agtech on 10%. Some more traditional areas are in the top 10, like media, fashion and manufacturing, but they’re surrounded by industries that are synonymous with making the world better; sustainability, wellness, energy, biotech and edtech.
The report also found that student entrepreneurs are far less likely to go it alone, with 79% of businesses having more than one founder. The average is 2.31 founders per business with more than a third having three founders and 13% having four or more.