We all have a part to play in supporting micro-businesses

Many entrepreneurs miss out on crucial support when they need it most, and their impact is overlooked by policymakers. The government needs to remember this group

Before May 2020, Treddafydd Organic had never taken an online payment. The family-run business in Wales sold organic fruit, veg and preserves at a local farmers’ market before the Covid-19 pandemic hit the UK. Within weeks, Treddafydd Organic pivoted its offer and started up an ecommerce venture for the first time.

With locals unable to leave their homes and grocery stores stripped bare, businesses like Treddafydd adapted and offered home delivery. Fast forward four months and Treddafydd Organic has had hundreds of orders. The farm’s co-founders now want to expand their online delivery service of jams, curds and chutneys nationwide to tap into customers around the country.

If not cause for jubilation, stories like these are certainly cause for hope, as we enter a new phase of Covid-19. And at the domain registrar and web-hosting company I work for, GoDaddy, we’re seeing more of these stories each month. In fact, our data shows that between April and June 2020, right at the peak of the pandemic, the birth of micro-businesses, and brand new ventures, rose by 14 per cent across the UK.

What’s even more striking is where these businesses are based. It would be easy to assume they are cropping up in city centres, but the data says otherwise. In a review of the UK’s micro-business landscape, including both official Office for National Statistics (ONS) data and GoDaddy’s growth in venture figures, we found a range of regional and largely suburban hubs around the country, where the vast majority of this economic activity has been and continues taking place.

These suburban powerhouses of micro-business growth were found in areas from Caerphilly in south Wales to Bolton in the northwest. And just like Treddafydd Organic, we understand these businesses can have a disproportionately positive impact on the communities in which they operate.

But growth in the sheer number of micro-businesses starting up or going online for the first time is just one part of what we have observed. What’s more hopeful is that across the board these small enterprises are still showing remarkable signs of confidence. We asked 1,000 UK micro-business owners, in our Global Entrepreneurship Survey, about the challenges and opportunities for the sector and three clear themes emerged.

Eight-five per cent of the micro-business owners we asked said that despite the impact of Covid-19, they expected their business to continue, and more than a third of these even expected their business to thrive. Meanwhile, 70 per cent of respondents believed their business will fully recover within 12 months.

Just like Treddafydd Organic, the micro-businesses we surveyed are focusing on the communities they operate in – while a third said community involvement had always been important to them, a further quarter told us it’s more critical than ever to be able to positively impact their local areas.

However, despite the positives, we also learned that micro-businesses aren’t getting the backing or support they need. In the UK, 22 per cent of micro-businesses are founded as side hustles and often aren’t registered as traditional small businesses, so their impact can be overlooked by policymakers. Seventy-one per cent of those who said they aren’t using government schemes have said it’s because they don’t have access at all. And when asked what they would need to survive another national lockdown, support from the government in the form of business grants or loans came top in the list, ahead of an extended furlough scheme, and then a freeze on business rates.

Micro-businesses are a unique sector. The very smallest of ventures can adapt swiftly, respond to changes in the economy in an agile way, and ultimately recover from economic shocks faster. But this can also mean they may be working with smaller margins and can fall outside conventional definitions of a business, and so may miss out on crucial government support when they need it most.

The resilience and innovation demonstrated by entrepreneurs gives me cause for hope. But now, more than ever, our smallest ventures need help to keep the green shoots of recovery growing. Whatever next year throws at this community of entrepreneurs – we all have a part to play in supporting them.

Irana Wasti is president of web-hosting platform GoDaddy in Europe and the Middle East