Research of 500 small business owners found many had to pull in cash from personal savings, family loans and credit cards to go it alone.
As a result, 80 per cent admitted they were walking a tightrope with their budgets in the early days, with 37 per cent failing to break even until at least three years in.
While 45 per cent underestimated how much money they would need to get their business off the ground and operational.
With 85 per cent calling for more funding and support for entrepreneurs to turn their ideas into businesses.
The research was commissioned by Santander to celebrate its X Awards for small businesses, which has awarded over £1.1 million in funding and support to thousands of UK businesses since 2010.
This year’s winners include Aeropod by Muju Earth, which creates biodegradable capsules to naturally aerate soil, Boost Innovations Ltd, the developers of prosthetic breasts for women following breast cancer, and Amparo Prosthetics Ltd, recognised for its smart, adaptable prosthetic solutions that support patient care.
Deborah Meaden, businesswoman and entrepreneur, who judged at this year’s final, said : “Starting a business is never easy – most entrepreneurs begin with very little and take huge personal risks to get their ideas off the ground.
“Even if you have capital behind you, starting a new venture has an element of risk, no matter how much research and preparation you put in.
“But if you’ve put everything you have into starting up, you have to do everything you can to make it work.”
The study also found the average business owner sat on their idea for three years before they actually made it happen.
With 27 per cent investing personal savings, and 26 per cent leaving a stable job for the potential high-risk, high-reward of their own venture.
To finance it, 14 per cent took out a loan and 13 per cent used their own rainy day fund to deal with unexpected costs.
The price wasn’t only financial though, as 45 per cent also sacrificed their social lives, and 40 per cent had to give up holidays in the early days of their business.
While 27 per cent went without buying any new clothes and 13 per cent even skipped buying birthday presents for family members, as every penny went into the business.
And 19 per cent admitted to lacking confidence in financial planning in the early stages of launch.
With 55 per cent claiming they couldn’t have started their business without financial help from other people, according to the OnePoll.com figures.
Having seen their businesses succeed, advice entrepreneurs would give newcomers starting with limited funds would be to start small and scale gradually (45 per cent), and not to expect profit straight away (43 per cent).
And 22 per cent would simply advise people not to take the leap without a financial cushion.
Mike Regnier, CEO at Santander UK, added: “Start-ups play a vital role in stimulating growth and innovation in the UK rock– they attract investment, enhance productivity and create jobs.
“However, building a successful business is no mean feat in today’s world.
“With rising costs and competitive access to finance, almost nine in 10 business-owners are calling for more funding and support.
“That’s why the Santander X Awards, our global entrepreneurship programme, sets out to support founders across the world with the funding and skills to take their businesses to the next level.
“A huge congratulations to this year’s winners – I look forward to watching your businesses grow.”
