Budget 2026: What it means for start-ups and scale-ups
Chancellor John Healey delivered his first Budget on 28 October. For founders across the South, the question is whether it gives them the confidence to invest, or leaves them waiting for more.
Ed Gould, Chair of Venturefest South and founder of Carswell Gould, gave his answer to Voice FM: there are good things in it, but the real test is whether businesses now have the certainty they have been missing.
What businesses were hoping for
Certainty, above all. After a long period of uncertainty that has left many businesses on hold, Ed like many businesses leaders was hoping to hear things that would stimulate growth and build great confidence
“Confidence comes from seeing solid plans to support growth. There wasn’t a great deal to note in this Budget, but a couple of measures were of real value, and those are worth building on.”
The measures that matter to entrepreneurs
Spending power and costs. The National Living Wage rises to £13.21 an hour, which should support spending on the high street. It also adds to employer costs in SMEs, making it harder to resource at the level they need. It had to happen, Ed said, but it is always a trade-off for the Chancellor.
Business rates. The threshold for small business rates relief for retail, hospitality and leisure businesses in England rises from £12,000 to £18,000 from April 2027, which the Government says will take 70,000 more businesses out of rates altogether. Ed called rates “an absolute killer” for anyone who has run a high street shop. It will not transform the whole business base, but it is a step in the right direction.
Founders’ relief. A new 10% capital gains tax rate applies to up to £10 million of lifetime gains. Some commentators say the eligibility criteria remain onerous, and the lifetime limit for Business Asset Disposal Relief has been cut from £1 million to £500,000.
Ed welcomes the recognition that founders take risks, but sees a gap.
“Founders’ relief rewards the people who get to the finish line, and that matters if we want successful founders to stay and reinvest here. But growth starts much earlier, with the investors who back an idea before there is anything to sell. That’s the part I’d like to see the next Budget do more on.”
Also included:
- Trading allowance for the self-employed rising from £1,000 to £3,000
- A young entrepreneurs allowance, covering a year of living costs for young founders starting out
- A new scale-up programme for female founders, with British Business Bank funding for female-led businesses doubling to £200m
- A further £20.4 billion for the National Wealth Fund and British Business Bank, and the Government accepting 14 of the 15 recommendations of the Small Business Regulation Taskforce
You can find the full list in SME Web’s Budget 2026 round-up
For the detail on how any of it applies to you, check the Government’s Budget documents or talk to your accountant.
AI, green technology and defence
The Budget singled out AI, green technology and defence for support. Ed wasn’t surprised. These are the areas where government, investors and industry are already pointing.
That doesn’t make them less important. Growth follows the money, and if more support and advice is available in these areas, the South’s innovators need to know how to connect with it. This year’s Venturefest South applicants include the highest proportion of AI businesses yet, so the region is already moving.
Opening up supply chains
Ed also welcomed the emphasis on diversifying supply chains and on helping more small businesses and innovators supply larger “primes”.
That is where events like Venturefest South come in. The aim is to turn government promises into pounds and pence for businesses, and ultimately “dinners on people’s plates”. The South has strong businesses in sustainability, environmental impact, defence, AI and technology transformation, and the job is to connect them to the opportunity.
Growth comes from the people doing the work
Ed’s overall view is a practical one. Read the Budget for where the wins are, but don’t depend on any one government or Budget to decide whether your business succeeds.
“There’s plenty to look for with optimism in this Budget, but businesses across the South need the confidence and support to invest, innovate and grow. We can’t depend on any one government or Budget to determine our success. It’s about understanding the challenges, building connections and turning opportunities into growth.
“The South has an incredible wealth of entrepreneurial talent. At Venturefest South’s Festival of Innovation on 18 November at the Utilita Bowl, we’ll bring founders, investors and business support organisations together to share ideas and help businesses start, scale and grow, whatever the economic conditions.”
Watch the full interview – Hear Ed’s reaction in full, including how this Budget compares across Venturefest South’s ten years.
To dig into the Budget with other founders, investors and support organisations, join us at the Festival of Innovation on 18 November.
