UK start-ups are failing because of a “lack of digital skills”

Two thirds of entrepreneurs say technical challenges prevent them entering new markets

A lack of digital skills, or ‘digital poverty’, has been blamed for the failure of many UK start-ups in the small business community, according to the Unleashing Entrepreneurs study by Ratuken.

The survey of 300 online business owners found that many “lack the requisite knowledge” and ability to navigate the digital landscape and take full advantage of available online tools.

Two thirds of digital entrepreneurs claimed that their attempts to enter new markets were being impeded by the technical challenges of adapting a website to different platforms and setting up mobile payment options.

Despite their growth far outstripping the actual economy, half of the respondents believed digital businesses to be more susceptible to failure than their physical counterparts, with 90% in agreement that the government should do more to support online entrepreneurs.

When it came to innovations to drive the growth of online businesses, a third of those surveyed suggested cloud hosting, followed by social integration and mobile.

Oskar Miel, managing partner of Rakuten FinTech Fund, commented on the study results:

“The online explosion may have removed many of the traditional barriers to entry for start-ups, but it’s clear they still need solid advice and the right capital partners to get their ideas off the ground.”

Henry Lane Fox, CEO of Founders Forum Group and co-founder of, added: “I’ve seen first-hand how online businesses can take off and be successful and one thing I’ve learned is how important digital skills are.

“Education is so important and it doesn’t just stop in the class room, entrepreneurs can also learn for the various online networks and communities out there that that are supporting each other and sharing great work. Things change and develop so quickly, it’s important to keep the skill levels up if you want your business to succeed.”


(will not be published)