Why financial confidence is the foundation every small business needs

Many young people in the UK are thinking differently about work – and not just about finding a job. We recently surveyed 1,000 students aged 16-21 and found that nearly three quarters (72%) are attracted to entrepreneurship. But ambition alone isn’t enough. 

Over a third (37%) say they’re held back by a lack of financial skills, and two-thirds (67%) think starting a business feels too risky right now.

With youth unemployment at its highest rate in over a decade, and only one in five young people (20%) planning a traditional career path, entrepreneurship offers a different route. But without a solid understanding of business finances, many young people are feeling stuck.

This is the gap Xero is working to help close.

A milestone moment: The Maple Review 

This month, we were proud to support the launch of The Maple Review. Led by Small Business Britain, the government-backed initiative explored the systemic barriers that stop people from starting and growing businesses, particularly those experiencing economic hardship.

The final report sets out practical recommendations for government and the business community, including:

• A National Business Skills Guarantee for secondary schools, so every young person has access to practical business skills, entrepreneurial role models and pathways before leaving school.
• Making financial confidence a core part of enterprise support, treating it as essential infrastructure for business survival, not an add-on. We see this every day in the small business community. Our own research found that 36% of small business owners do not know whether they were profitable last month, while 28% say they are “not a numbers person”.

As The Maple Review becomes The Maple Project, we look forward to this next phase, turning the findings into action. More than ever, we need to ensure the door to entrepreneurship is open to everyone, regardless of background. 

Starting a business at 21 with passion but no financial toolkit

Kate Perry started her dog training business, Chase Canines, at just 21. Like many first-time founders, she quickly realised that running a business means juggling far more than expected. While school taught her the basics of budgeting, it did not prepare her for the realities of managing business finances. 

“If young people were given more exposure to business and financial management earlier on, it could make entrepreneurship feel far more achievable – and it certainly would have given me more confidence when I was starting out.” – Kate Perry, Chase Canines

Young people like Kate have the ideas and ambition to start something amazing, but can feel held back without the right support. 

Building on the ideas of Xero’s Financial Confidence Taskforce

The Maple Review builds on work Xero has been championing through our Financial Confidence Taskforce – a group of experts from accountancy, business and education brought together to rethink the way financial literacy and confidence are built. Our Taskforce report identified themes that align with The Maple Review: the need for better business financial education in schools, more visible and relatable role models and the vital role of communities – accountants, bookkeepers and advisors – in building confidence.

Bringing these recommendations to life will help to ensure that entrepreneurial ambition, not financial anxiety, defines success across the UK’s small business economy.

How Xero is making financial literacy more accessible

To help close the financial skills gap and give entrepreneurs more confidence around their numbers, we offer free financial literacy content and mentoring through our Unlock Your Numbers programme. Anyone can access the easy-to-digest video content and helpful guides, covering everything from reading a P&L to understanding the difference between cash flow and profitability. 

Through the Xero For Good Ambassador Programme, volunteer accountants and bookkeepers from the Xero advisor network are matched with small business owners to provide the kind of practical, human support that makes a difference when finances feel overwhelming.

Helping small businesses make more informed financial decisions opens up a world of opportunity, and for the next generation of ambitious entrepreneurs, the right financial skills could be the difference between feeling stuck and creating a thriving business.