Cypriots divided on how easy it is to start a new business

Cypriots are split on whether it is easy to start a new business here, as well as whether there are robust opportunities for doing so, according to the Global Entrepreneurship Monitor for 2022, which was published this week.

The latest GEM Global Entrepreneurship Monitor report, which is considered to be one of the most important international entrepreneurship studies, focussed on identifying opportunities amid a period of prolonged disruption.

According to the results of the study, 50.9 per cent of Cypriot participants said that they consider it to be easy to start a business on the island, while a similar percentage, 50.2 per cent, said that there are good opportunities to start a new business in the area in which they reside.

Moreover, 64.1 per cent said that they believe that they have the necessary skills and knowledge to do so, while 50.1 per cent expressed fear of failure when considering such a venture.

The study’s attitudes and perception analysis also noted that 15.1 per cent of Cypriots have entrepreneurial intentions, while 72.9 per cent know someone who has started a new business, the second-highest among all participating countries.

Regarding the latter aspect, the study explained that for some people, starting a business may be well outside their range of personal experiences.

This is because they may live in an environment in which there is only a handful of entrepreneurs, or in which entrepreneurship has a low profile.

Conversely, the study noted, they may have family or friends who have started their own business or be in an environment in which entrepreneurship is high-profile, with significant positive media attention.

“The difference is important, as it affects the awareness and perceived attractiveness of entrepreneurship as a positive career option,” the study said, noting that there is considerable variation in the proportion of adults who know someone who has recently started a business, within all income groups.

“The highest proportions are in the Dominican Republic, Guatemala and Cyprus, each relatively small economies, while the lowest proportions are in Japan and Egypt, both large economies,” the study added.

Further to this point, the study explained that these proportions may also reflect both the relative level and profile of entrepreneurship in that economy.

“It is much harder to personally know an entrepreneur when they are relatively scarce and rarely reported in the media,” the study stated.

In terms of motivation, roughly one in three Cypriots (32.2 per cent) said that they want to start a new business to make a difference, while a significantly higher number (81.3 per cent) said that their objective is to build great wealth.

A similarly high score was observed in the number of people who said that they want to start a new business in order to earn a living, with 72.8 per cent stating as such.

However, roughly only one in ten (13.7 per cent) said that they have entrepreneurial aspirations in order to continue a family tradition, a reflection of how the Cypriot economy has evolved in recent years.

Regarding their entrepreneurship impact, only 0.8 per cent said that they expect to be employing six or more people in five years’ time.

Additionally, a paltry 1.2 per cent of participating adults said that they expect to generate at least a quarter of their revenue from international markets or clients.

Encouragingly, however, 68 per cent of Cypriot entrepreneurs said that they are always considering the social impact of their business, while 65.9 per cent said that they are always considering its environmental impact.

In terms of activity, 8.4 per cent of participants said that they are engaged in total early-stage entrepreneurship activity, of which 6.1 per cent are women and 10.8 per cent are men.

What is more, 8.6 per cent are engaged in established ownership, 6.7 per cent of which are women, while 10.6 per cent are men.

Regarding business concerns related to the Covid-19 pandemic, 40.8 per cent of Cypriots said that the pandemic has led to a decrease in household income, while 43.6 per cent said that starting a business is more difficult than a year ago.

In addition, half of Cypriot participants (53.1 per cent) said that the pandemic led to the increased use of digital technology to sell products or services, while 4 out of 10 (39.4 per cent) said that the crisis caused them to pursue new opportunities.