New research from StartUP Britain suggest Birmingham is outstripping rivals such as Manchester, Leeds and Glasgow to foster creation of new businesses.
Data released by StartUp Britain, the national campaign by entrepreneurs, based on analysis of Companies House filings, shows that 17,473 new businesses were registered in Birmingham during 2016.
This is an increase of 25 per cent on the previous year and more than any other city outside the capital.
Birmingham has now retained its position as the number one regional destination for start-ups for four consecutive years.
The number of new businesses is almost double that of Manchester's, which follows in second place with 9,416 companies registered during 2016, whilst Glasgow is third with 7,845.
Birmingham also surpassed London to become the country’s leading city for business growth rates in 2016, according to the Office for National Statistics' business counts data.
Neil Rami, chief executive of inward investment agency Marketing Birmingham, said: "Birmingham has simultaneously outpaced the capital city to become the UK's leading destination for business growth and is the UK's number one regional destination for start-up creation.
"The city's young, talented workforce, newly developed infrastructure, and range of incubator and accelerator programmes, has fostered a strong ecosystem that fuels a culture of innovation.
"Start-ups and SMEs are crucial to the long-term health of our local and national economy.
"Through access to finance, mentoring schemes and initiatives like the Greater Birmingham and Solihull Growth Hub, aspiring entrepreneurs can stay in Birmingham to fulfil their ambitions.
"This, in turn, creates employment opportunities for local people, boosting the region's productivity and knowledge economy."
Steve Hollis, chairman of the Greater Birmingham and Solihull Local Enterprise Partnership, added: "These figures are testament to Birmingham's entrepreneurial spirit and its ability to attract, foster and grow early-stage
"The city has maintained its position as the leading regional destination for start-ups for four consecutive years and is now home to 17,473 new businesses.
"Start-ups come - and stay - in Birmingham, not only because of the formal support they can access through for example, the region's Growth Hub, but because of the skilled people they can employ, the cost efficiencies of being based here and the ecosystem of small to medium enterprises here.
"There is nothing like the support of peers, particularly those who are further ahead in the journey than you are."
Cities with the most start-ups outside London in 2016.
8. Brighton and Hove