Leeds has emerged as one of the UK’s most resilient cities for new businesses, ranking third nationally for startup survival over five years, according to new research by finance platform Pheabs.
The study found that 48% of startups in Leeds remain operational after five years, which is significantly higher than the national average of 39–41%. The city trails only Newcastle (52%) and Rutland (50%) in the rankings.
Pheabs evaluated key business metrics such as average annual income, business density, and sectoral spread to determine where startups are most likely to succeed. Leeds’ strong performance is attributed to its accessible transport links, moderate setup costs, and a supportive entrepreneurial ecosystem.
With a population exceeding 800,000, Leeds offers scalable potential for SMEs compared to smaller urban centres. Its economic ties across West and South Yorkshire, connecting cities like York, Harrogate, Sheffield, and Bradford, further strengthen the regional business environment.
Other high-performing areas include York (47%), Surrey (44%), Bristol (44%), and Lancashire (41%). The report highlights the broader challenge of SME sustainability across the UK, where only half of startups typically survive past their fifth year, underlining the pressure from rising labour and operational costs.
