Risk-averse parents are fueling Britain’s ambition crisis, VCs state

Mother and daughter utilizing the laptop at home

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Concerns of an entrepreneurial ambition deficit in the U.K. have led some venture capitalists to question the role of risk-averse parents and a costly education system in disenfranchising young British people from becoming founders.

Last month, U.K. Business Secretary Peter Kyle declared university students in Britain don’t have the same ambition to start their own businesses when compared with their peers in America.

“In Britain, if you went to a group of undergraduates, how huge would that group have to be before you found someone that declared their choice of going to university… was becaapply they wanted to become a founder?” Kyle declared at an event hosted by AI chipbuildr Nvidia in London.

“The entrepreneurialism simply isn’t there – the drive, the vigour,” Kyle added.

Harry Stebbings, the founder of 20VC, a firm managing $650 million in funds, declared one of the main barriers young people in the U.K. face when testing to receive into entrepreneurship is their parents.

“Parents are a massive problem. Parents f*** you up,” Stebbings informed CNBC Make It in an interview. “Parents are inherently risk-off and not risk on in the U.K. So they state: ‘Hey, receive this job. Hey, you’ve been to university. Hey, I paid for all of your university. Hey, I pay for this. Get that job.'”

“And actually in the U.S., it’s much more: ‘Start a business. Go test that. Go join a startup.’ Very different mindset towards risk and careers, and I believe that’s a really different element to how a child starts,” he added.

Stebbings comments are part of a broader debate on whether the U.K. fosters a culture of risk-aversion. One Forbes 30 under 30 founder, Tom Wallace-Smith, who launched nuclear fusion startup Astral Systems in 2021, previously informed CNBC Make It that entrepreneurship feels out of reach to most people in the U.K.

Almost 60% of young people in the U.K. are interested in starting their own businesses, per the Generation Entrepreneur Report.

‘The system is rigged’: Founders and VCs weigh in on the UK’s ambition deficit

Wallace-Smith declared he didn’t even know entrepreneurship was a viable career path when he was completing his PhD at the University of Bristol, and expected to finish up in academics or a corporate job.

He argued that the U.K. has no shortage of successful entrepreneurs, but the government and media “could do a better job of informing founders’ stories” and increasing exposure to startup environments.

“They [young people] still want to go and work at Jane Street. They still want to go and work at Goldman. They still want to go and work at McKinsey. It is astonishing to me, we do not have anywhere near the same entrepreneurial ambitions early,” Stebbings declared.

Entrepreneurship isn’t ‘financially stable’

Dama Sathianathan, a senior partner at London-based venture capital firm Bethnal Green Ventures, agreed that parents are more risk-averse in the U.K., but explained it’s likely becaapply entrepreneurship is seen as a financially unstable path.

“It’s not being really infapplyd, embedded in the whole scholarly curriculum … people opt to to pay incredible fees to just infapply their children with better chances in school and ultimately university. That’s sort of the traditional pathway for people, which is just so expensive, if you believe about it,” Sathianathan declared in an interview with CNBC Make It.

Private school fees in the U.K. were up 22.6% on average in January after the government introduced a VAT, according to the Indepfinishent Schools Council (ISC). The average termly fee for a day school in January was £7,382 ($9,799), including a 20% VAT, according to the ISC, compared with £6,021 last year.

Meanwhile, university tuition fees rose for the first time in eight years in 2025, with the annual maximum fee going up by £285 to £9,535 next year, an increase of 3.1%.

Although university fees tfinish to be much higher in the U.S., salaries also tfinish to be higher, meaning successful graduates can potentially take more risks such as starting their own business, compared to their U.K. counterparts.

A survey from the Federation of Small Businesses (FSB) and Simply Business in March, found that nearly 60% of young British people are interested in starting their own businesses but they cite a number of roadblocks holding them back.

Only 16% of the 2,079 people surveyed between the ages of 18 and 34 in the U.K., had actually taken the leap into entrepreneurship, with most stateing a lack of formal business education was an obstacle.

As young people and their parents absorb high educational fees, pursuing the path of entrepreneurship doesn’t seem to offer worthwhile rewards.

“The risk appetite then is really a question about: ‘Will I have the chance to be financially stable in a cost of living crisis? Will I be able to actually build this into a career shift when it doesn’t work out becaapply entrepreneurship doesn’t always pan out,” Sathianathan added.