However, London still hugely dominates the start-up scene with an incredible 187,250 new businesses set up last year.

The main factors contributing to Birmingham’s flourishing entrepreneurial spirit include its world-class accelerator schemes, affordable office space, and access to global markets.

Ian Ward, Birmingham City Council leader, said: “Birmingham is once again creating more businesses than any city outside the capital, cementing our status as one of Britain’s most innovative cities.

“Through dedicated support for entrepreneurs and small firms, more start-ups are being created than ever before, and record numbers of businesses and people are choosing Birmingham as their home.

“This has not happened by coincidence and is the result of years of hard work to create the perfect environment for skilled entrepreneurs, who are provided with world-class accelerator schemes, affordable office space and access to a global market.

“These statistics just go to show that Birmingham is the perfect place for people with a good idea to succeed.”

Andy Street, Mayor for the West Midlands Combined Authority, said: “Recent successes with the Commonwealth Games and Coventry City of Culture demonstrate the confidence and excitement in our region and these record numbers of start-ups created last year reinforce the view that this is our time.

“It’s never been more important to focus on driving growth in our great regions, and Birmingham is leading the way with more small businesses being created than any other regional city.

“With the West Midlands fighting to attract Channel 4 to our region, successes like this – which are heavily based on our strengths in the digital and creative industries – will help our case significantly.”

Saqib Bhatti, director for Growing Businesses and Representing SMEs at Greater Birmingham & Solihull Local Enterprise Partnership (GBSLEP), added:

“It comes as no surprise that Birmingham has maintained its position as the UK’s leading regional start-up destination for the fifth year in a row.

“It is testament to the city’s hard-working nature, entrepreneurial spirit and vibrant support networks that Birmingham continues to come out on top.

“The GBSLEP Growth Hub provides a single point of contact for growing companies that are looking for advice and funding – so they can expand, innovate, recruit and ultimately fulfil their potential.

“Since it launched in 2015, the Growth Hub has helped 500 start-ups across Greater Birmingham and Solihull, which has created over 400 jobs and supported the area’s ongoing transformation.

“From creative to tech, professional services to retail, vibrant start-ups are helping to further cement the region’s reputation as a hotbed for industry and innovation.”

Below is the full list of start-up businesses by city for 2017.

1. London (combined): 187,250 start-ups

2. Birmingham: 12,108

3. Manchester: 8,295

4. Glasgow City: 6,189

5. Leicester: 5,942

6. City of Edinburgh: 5,176

7. Leeds: 4,915

8. Liverpool: 4,707

9. Bromsgrove: 4,703

10. Bristol: 4,320