The number of new food and drink start-up launched in the UK in 2020 and up 30 June has gone up 47%, going from 3,996 to 5,885 as people on furlough have started their own ventures, new research by corporate commercial law firm EMW has found.
According to EMW, the COVID-19 pandemic has caused many people to re-evaluate their careers and start their own business, focussing on what they are passionate about. The most popular start-ups over the past year have been food and drink businesses.
Natasha Thomas, CEO of a travel and events company, and her husband, launched Lockdown Liquor & Co, a range of pre-made cocktails, during the first pandemic lockdown. Vegan relish brand Nakasero was set up by Gita Raikundalia, an ex-corporate finance executive who developed the business from her kitchen. Launched in February 2020 just before the pandemic hit the UK, the company has already won multiple awards and its products are now stocked in independent shops across the country. Will Lewis had an idea to launch his own brand of pies for some time, but it was the pandemic that finally turned the idea into a reality and the chef launched Willy’s Pies during lockdown.
Despite the rise in the number of start-ups, getting past the initial stage of their development can be challenging. According to EMW only around one in three new businesses survive their first 12-24 months. Start-ups need to show that their business idea is viable and must prove it can generate sales, before they are able to get funding.
Daisy Divoka, Senior Associate at EMW, says: “More people are becoming disillusioned with the nine to five and are leaving their careers behind to follow a passion for food.
“There are many great stories of people leaving their careers behind to launch successful companies. But people need to be aware of the challenges involved when setting up a business, including health and safety, labelling regulations or trademark protection to name a few.”
“In terms of funding there can be a big gap where they are unlikely to get investment until their business is up and running.“, adds Divoka. “One of the biggest gaps in funding is between the friends and family stage and the first round of venture capital funding.”