GITNUXREPORT 2025

Business Formation Statistics

Business formations surged globally, emphasizing technology and diverse entrepreneurial reasons.

Jannik Linder

Co-Founder of Gitnux, specialized in content and tech since 2016.

First published: April 29, 2025

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Statistic 1

In 2022, approximately 4.4 million new business applications were filed in the U.S.

Statistic 2

The rate of business formation in the U.S. increased by 24% from 2020 to 2022

Statistic 3

Small businesses account for 62% of all new jobs in the U.S.

Statistic 4

The number of LLC formations increased by 15% in 2022 compared to previous years

Statistic 5

In the UK, small business startup rates increased by 8% in 2022

Statistic 6

About 20% of new businesses fail within their first year

Statistic 7

Approximately 15% of new U.S. businesses are registered as corporations

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The most popular business formation type in Europe is the sole proprietorship, accounting for 65% of start-ups

Statistic 9

In 2022, the number of new franchises in North America increased by 10%

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The average time for a startup to become profitable is approximately 2.5 years

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The tech sector saw a 12% increase in new startups in 2022

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The average startup employee count at formation is 4 to 6 employees

Statistic 13

AI and machine learning startups grew by 28% globally in 2022

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The U.S. states with the highest business formation rates are Texas, Florida, and California

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The retail sector saw a 22% increase in new business formations in 2022

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In 2022, the top reason for startup failure was lack of market demand, cited by 42% of entrepreneurs

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The first-year survival rate for new businesses globally is around 70%

Statistic 18

The share of remote-first startups grew by 35% in 2022, reflecting trends towards flexible work environments

Statistic 19

California leads the U.S. in new startup formations, accounting for 22% of all new business filings in 2022

Statistic 20

Religious and spiritual businesses represented approximately 5% of new startup formations in 2022

Statistic 21

The number of export-oriented startups increased by 9% in 2022, driven by globalization efforts

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The majority of startups are incorporated in Delaware, which hosts over 70% of publicly traded companies

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The average gross revenue of new startups in their first year is approximately $50,000

Statistic 24

Community-focused startups represent around 15% of new business formations, aiming to solve local issues

Statistic 25

The impact of COVID-19 accelerated the adoption of digital-only startups by 25% in 2022

Statistic 26

In 2022, the global number of unicorn startups (valuation over $1 billion) increased by 40%, reaching over 1,200 unicorns worldwide

Statistic 27

The average age of first-time entrepreneurs in the U.S. is 42 years old

Statistic 28

The number of women entrepreneurs worldwide has increased by 17% from 2019 to 2022

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45% of new business owners started their business as a side hustle in 2022

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70% of new small businesses in the U.S. are started by entrepreneurs aged 30-50

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About 55% of entrepreneurs in developing countries start their own business to address local needs

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68% of entrepreneurs in Europe cite market opportunity as the primary reason for starting a business

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In Australia, small businesses represent 97% of all businesses

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80% of startups in emerging markets are started by entrepreneurs under 40 years of age

Statistic 35

The median age of founders in climate tech startups is 45 years old, indicating experienced entrepreneurs are leading this sector

Statistic 36

60% of startup founders in the U.S. have at least some college education

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Nearly 40% of startups are founded by immigrants, highlighting the importance of diverse entrepreneurship

Statistic 38

The global startup funding reached over $600 billion in 2022

Statistic 39

Women-founded startups received 2.3% of total venture capital funding in 2022

Statistic 40

The median startup funding round in 2022 was $2 million

Statistic 41

About 38% of startups receive funding from angel investors

Statistic 42

The average cost to start a small business in the U.S. is approximately $3,000

Statistic 43

The initial average investment per startup in 2022 was $1.8 million

Statistic 44

In 2023, artificial intelligence startup funding surpassed $70 billion globally

Statistic 45

About 30% of startups receive some form of government grant or subsidy

Statistic 46

Startup accelerators support over 10,000 startups globally, with a reported 10% increase in participation in 2022

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Technology remains the leading sector for new business formations, accounting for 27% of all new startups

Statistic 48

The e-commerce sector accounted for 32% of new startups in 2022, making it the fastest-growing industry segment

Statistic 49

Legal service startups increased by 18% in 2022, reflecting rising demand for legal tech solutions

Statistic 50

Franchise chains grew by 12% in 2022, with food service franchises leading the growth

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Key Highlights

In 2022, approximately 4.4 million new business applications were filed in the U.S.
The rate of business formation in the U.S. increased by 24% from 2020 to 2022
Small businesses account for 62% of all new jobs in the U.S.
The global startup funding reached over $600 billion in 2022
Women-founded startups received 2.3% of total venture capital funding in 2022
The average age of first-time entrepreneurs in the U.S. is 42 years old
The number of LLC formations increased by 15% in 2022 compared to previous years
Technology remains the leading sector for new business formations, accounting for 27% of all new startups
In the UK, small business startup rates increased by 8% in 2022
About 20% of new businesses fail within their first year
The number of women entrepreneurs worldwide has increased by 17% from 2019 to 2022
45% of new business owners started their business as a side hustle in 2022
The median startup funding round in 2022 was $2 million

With a surge of 4.4 million new business applications in 2022 and a 24% increase in formation rates nationwide, the entrepreneurial landscape is booming, driven by innovation, diverse founders, and shifting market opportunities.

Business Formation and Growth Trends

In 2022, approximately 4.4 million new business applications were filed in the U.S.
The rate of business formation in the U.S. increased by 24% from 2020 to 2022
Small businesses account for 62% of all new jobs in the U.S.
The number of LLC formations increased by 15% in 2022 compared to previous years
In the UK, small business startup rates increased by 8% in 2022
About 20% of new businesses fail within their first year
Approximately 15% of new U.S. businesses are registered as corporations
The most popular business formation type in Europe is the sole proprietorship, accounting for 65% of start-ups
In 2022, the number of new franchises in North America increased by 10%
The average time for a startup to become profitable is approximately 2.5 years
The tech sector saw a 12% increase in new startups in 2022
The average startup employee count at formation is 4 to 6 employees
AI and machine learning startups grew by 28% globally in 2022
The U.S. states with the highest business formation rates are Texas, Florida, and California
The retail sector saw a 22% increase in new business formations in 2022
In 2022, the top reason for startup failure was lack of market demand, cited by 42% of entrepreneurs
The first-year survival rate for new businesses globally is around 70%
The share of remote-first startups grew by 35% in 2022, reflecting trends towards flexible work environments
California leads the U.S. in new startup formations, accounting for 22% of all new business filings in 2022
Religious and spiritual businesses represented approximately 5% of new startup formations in 2022
The number of export-oriented startups increased by 9% in 2022, driven by globalization efforts
The majority of startups are incorporated in Delaware, which hosts over 70% of publicly traded companies
The average gross revenue of new startups in their first year is approximately $50,000
Community-focused startups represent around 15% of new business formations, aiming to solve local issues
The impact of COVID-19 accelerated the adoption of digital-only startups by 25% in 2022
In 2022, the global number of unicorn startups (valuation over $1 billion) increased by 40%, reaching over 1,200 unicorns worldwide

Business Formation and Growth Trends Interpretation

Amidst a surge of 4.4 million US business applications in 2022—driven by an 8-24% increase in startup formations across sectors and borders—nearly a million new ventures are planting roots each year, with innovative entrepreneurs leaning toward LLCs and remote-first models, yet nearly 20% face the inevitable odds of failure within their first year, reminding us that while entrepreneurship is thriving globally and digitally, success still hinges on market demand, strategic growth, and resilience.

Demographics and Founders Characteristics

The average age of first-time entrepreneurs in the U.S. is 42 years old
The number of women entrepreneurs worldwide has increased by 17% from 2019 to 2022
45% of new business owners started their business as a side hustle in 2022
70% of new small businesses in the U.S. are started by entrepreneurs aged 30-50
About 55% of entrepreneurs in developing countries start their own business to address local needs
68% of entrepreneurs in Europe cite market opportunity as the primary reason for starting a business
In Australia, small businesses represent 97% of all businesses
80% of startups in emerging markets are started by entrepreneurs under 40 years of age
The median age of founders in climate tech startups is 45 years old, indicating experienced entrepreneurs are leading this sector
60% of startup founders in the U.S. have at least some college education
Nearly 40% of startups are founded by immigrants, highlighting the importance of diverse entrepreneurship

Demographics and Founders Characteristics Interpretation

These statistics reveal that entrepreneurial dynamism is driven by experience, diversity, and adaptability—spanning age, gender, education, and geography—proving that innovation isn't confined to youth but flourishes through seasoned expertise and inclusive ambition across the global economic landscape.

Funding and Investment Patterns

The global startup funding reached over $600 billion in 2022
Women-founded startups received 2.3% of total venture capital funding in 2022
The median startup funding round in 2022 was $2 million
About 38% of startups receive funding from angel investors
The average cost to start a small business in the U.S. is approximately $3,000
The initial average investment per startup in 2022 was $1.8 million
In 2023, artificial intelligence startup funding surpassed $70 billion globally
About 30% of startups receive some form of government grant or subsidy

Funding and Investment Patterns Interpretation

While global startup funding soared past $600 billion in 2022—with AI investments alone exceeding $70 billion—women-founded ventures still secured just 2.3% of venture capital, highlighting that despite growing support and median rounds around $2 million, the equity gap remains as significant as the modest $3,000 needed to start a small U.S. business.

Global and Regional Startup Dynamics

Startup accelerators support over 10,000 startups globally, with a reported 10% increase in participation in 2022

Global and Regional Startup Dynamics Interpretation

With over 10,000 startups worldwide and a 10% uptick in 2022, startup accelerators are clearly the engines fueling the global entrepreneurial renaissance—proving that innovation isn't just a spark, but a sustained blaze.

Industry Sector Developments

Technology remains the leading sector for new business formations, accounting for 27% of all new startups
The e-commerce sector accounted for 32% of new startups in 2022, making it the fastest-growing industry segment
Legal service startups increased by 18% in 2022, reflecting rising demand for legal tech solutions
Franchise chains grew by 12% in 2022, with food service franchises leading the growth

Industry Sector Developments Interpretation

As technology continues to dominate the startup scene—including e-commerce’s booming 32% share—and legal and franchise sectors following suit, it’s clear that innovation and adaptability remain the ultimate catalysts in today’s thriving business landscape.