Business owners no longer necessitate an unmet market need; they simply require ample funds.

The landscape of business ownership in the UK is undergoing a significant shift, with an increasing number of aspiring entrepreneurs turning to Entrepreneurship Through Acquisition (ETA) as a means to enter the world of business. This trend, while growing in popularity, is notably different from the US, where ETA has been facilitated by the Small Business Administration (SBA) loan scheme.

The SBA, in the US, provides loans of up to $5 million dollars to acquirers, with the SBA guaranteeing between 75 per cent to 85 per cent of the loan. These loans come with more favourable terms, including longer repayment terms (up to 25 years), competitive interest rates, and easier qualification criteria compared to regular bank loans. This scheme has been instrumental in the succession of many businesses that would have otherwise shut down due to the surge of baby boomer and generation X business owners looking to retire.

In contrast, the UK falls short in providing similar financial resources for ETA. The lack of a government-backed credit guarantee program specifically for ETA is a significant barrier for many budding entrepreneurs who may need a bank loan to fund a significant portion of the acquisition costs.

The Federation of Small Businesses estimates that a UK government-backed scheme similar to the US SBA loan scheme would help facilitate the succession of many fantastic small businesses, as well as support the UK's aspiring entrepreneurs. This could potentially provide a solution for those businesses where there is no obvious successor.

The desire to become an entrepreneur is higher among younger age groups in Britain, with 73% of 16-24 year-olds and 80% of 24-34 year-olds expressing interest. This youthful enthusiasm for entrepreneurship is evident in the success stories of young entrepreneurs such as Liam Browne, whose pitch for "Full Power Cacao" on BBC's Dragons' Den is considered one of the most successful in the show's history, securing a £50,000 investment.

However, the lack of financial resources remains the most common reason cited by budding entrepreneurs in the UK for not pursuing ETA. This gap in support could be bridged by the implementation of a government-backed scheme, as suggested by Rachel Reeves in her recent Mansion House speech, where she stated that the UK is "open for business".

As more and more young entrepreneurs express their interest in ETA, top US business schools are offering electives such as "Entrepreneurship Through Acquisition" to teach students the skills required to acquire, manage, and grow a small business. Alex O'Leary, a corporate partner at JMW Solicitors in London, is one of the professionals who are ready to guide these aspiring entrepreneurs on their journey.

In conclusion, the model of entrepreneurship through acquisition is growing in popularity in the UK, and the implementation of a government-backed scheme could provide a significant boost to the economy, supporting SMEs, which account for 99.2% of UK businesses, employ around 60% of the UK workforce, and generate a turnover of £1.8 trillion. Succession planning for SMEs should be at the forefront of the government's economic strategy, ensuring a bright future for these businesses and the UK's aspiring entrepreneurs.

Business owners no longer necessitate an unmet market need; they simply require ample funds.