Rising rents in Hackney are driving London’s entrepreneurs further east, according to new research which reveals the city’s entrepreneurial map is being redrawn.
The data shows that Tower Hamlets, Barking and Dagenham, and Redbridge are now the capital’s fastest-growing boroughs for small business density, leaving behind Hackney, which for years has been regarded as a hive of startup culture.
Tower Hamlets recorded the sharpest annual increase in small business density at 33%, fuelled in part by £700,000 of local council investment to support independent enterprises. Barking and Dagenham followed closely with a 29% rise, while Redbridge registered a 25% increase.
Newham, another east London borough, also reported notable growth, up 19% year-on-year.
By contrast, Hackney’s growth slowed to 16%, ranking it just 27th out of 32 London boroughs. Despite its reputation for thriving independent shops, cafés and creative businesses, entrepreneurs appear to be seeking more affordable ground.
The slower growth coincides with soaring rents. The Office for National Statistics found that the average private rental property in Hackney rose 9.3% in the past year to £2,550 a month. For many entrepreneurs, that cost squeeze is proving a barrier to launching or expanding ventures in the borough.
Alex Rosen, Global Head of the GoDaddy Small Business Research Lab, who carried out the research, said the shift was clear: “East London has a rich history of entrepreneurialism, from its industrial past to its current standing as a vibrant hub. What we’re seeing now is a new wave of founders moving beyond Hackney to more affordable areas, spreading the momentum and creating new opportunities further east.”
The GoDaddy Lab tracks “microbusiness density” — the number of small businesses per 100 people — and provides one of the most detailed snapshots of entrepreneurial growth across London. It confirms that the capital remains the UK’s most entrepreneurial city overall, outpacing rivals like Aberdeen and Coventry.
At borough level, the eastward shift marks a notable rebalancing.
Apsana Begum, MP for Poplar and Limehouse, urged continued support for local enterprises in Tower Hamlets:
“Hardworking small business owners and workers across Tower Hamlets serve our communities every day. I encourage people to shop locally to ensure they continue to thrive.”
The rise of flexible workspaces has also contributed to the trend. Mark Dixon, Founder and CEO of International Workplace Group, said: “There has been strong growth in businesses enabling their people to work closer to where they live, saving time and money through reduced commuting and lower real estate costs. This is happening nationwide — and the east London boroughs are no exception.”
The future of London’s startup and property scene
For entrepreneurs priced out of Hackney, areas like Barking and Dagenham, Redbridge, and Newham now offer not only affordability but also growing ecosystems of fellow founders.
With London’s population continuing to expand and demand for affordable business space rising, GoDaddy’s findings suggest that the city’s startup spirit is not dimming but moving — and in the process, reshaping the boroughs that will define the next chapter of London’s entrepreneurial story.
