Mid-tier firm Moore Stephens found that lower launch costs is the main driver for people who were born between 1981 and 1996 to open their own businesses.
The growth in cloud computing and “software as a service” is also helping to cut the up-front cost of IT needed for a small business.
The firm said that the challenges facing the banking sector in 2007-08 led to a rise in entrepreneurship, as well as the rise of the gig economy which has given young people a taste of what feels like to be their own bosses.
An increase in shared and flexible workplaces has also made it easier for a start-up to launch. Last year, flexible workplaces represented 4.5% of London’s office space, compared to 1.7% one decade earlier.
Ross Northall, partner at Moore Stephens, said, “The rise of the gig economy and the tough market for graduate jobs has obvious downsides but these may have acted as a catalyst for young entrepreneurs to strike out on their own.
“The start-up boom of the last generation of entrepreneurs saw the success of technology companies, such as King Digital, Net a Porter and ASOS, that has served as an inspiration for the current generation. Millennials are now taking what they have learned from that earlier wave of businesses and are building on that.”
Earlier this year, the UK’s fifth-largest accountancy firm Grant Thornton interviewed 3,333 people, including 1,395 young adults, before reaching the conclusion that London is likely to haemorrhage young people in the foreseeable future unless its leadership moves to tackle major challenges like housing, health and transport.
Its research revealed that 16% of Londoners (just over 1.4 million out of 8.8 million people) are planning to leave, while 6.2% intend to do so in the next 12 months. The leavers are typically aged 25-34 and in full-time employment.
However, research by Nestpick found that London was the third best city around the world for entrepreneurial millennials, just behind Berlin and Montreal and ahead of Amsterdam, Toronto, Vancouver and Barcelona.