The 24-year-old from Penrith has worked in warehousing and abandoned her university studies after deciding she was on the wrong path.

"I was warehousing at night and studying during the day," she said.

"I was sick of studying and needed to work."

It was during a late night conversation with a friend that the pair decided to go into business together doing photography and graphic design.

"It's fantastic. Ever since we moved into [a shared office space in Penrith] our productivity has gone through the roof," Ms Moon said.

"We are finding our niche in the world."

KPMG demographer Bernard Salt said more than 340 new start-ups were popping up every week in entrepreneurial hotspots including Riverstone in NSW, Frankston in Victoria, Aspley in Queensland, Mandurah in Western Australia, Hobart in Tasmania and Victor Harbor in South Australia.

"There are more than 17,000 new businesses created with up to five people every year. It is easily the fastest growing new business area," he said.

"Bigger businesses might be putting on more staff, but this is new business creation.

"There is an extraordinary amount of creative entrepreneurial energy at the micro business level. This level is sole traders and people employing up to five people".

The biggest surge in new business owners was made up of Generation Y and Baby Boomers.

"I think Baby Boomers are reimagining how life is lived in your 60s," Mr Salt said.

"I'm arguing that this is actually an Aussie dream, being your own boss, especially if you can do it in a lifestyle area.

"Generation Y are not committed to marriage, mortgage or children in their 20s as were preceding generations and can be more entrepreneurial at a younger age."

In his new report: Small Business, Big Thinking: The entrepreneurialism of the Aussie workforce, Mr Salt has identified three new tribes of entrepreneurs:

Lifestylepreneur: is a sole trader living in lifestyle locations including Byron Bay and Lismore in the Northern Rivers region of NSW, Melbourne's Mornington Peninsula and the Gold Coast and Sunshine Coast hinterland. They are typically retired or Baby Boomers who are chasing a sea or tree change and a cheaper cost of living. They include artists, masseuses and pilates instructors. Illustration: John Shakespeare

Tradiepreneur: sole trader and small business owners made up of Generations Y and X who work in trades including construction, plumbing, carpentry, shopkeeping, accounting, financial planning, motor mechanics, medical, dental, legal and personal services such as hairdressing. They live in the city, middle and outer suburbs. Locations include Sydney suburbs Kenthurst and Catherine Field. In Melbourne, areas including Park Orchards. Illustration: John Shakespeare

Corporatepreneur: Lives in more exclusive suburbs of capital cities and operate larger-scale small business enterprises. The entrepreneurs in this area include established Gen X and ambitious Gen Y start-ups. Locations include Vaucluse in Sydney, the North Shore and Northern Beaches and Bright to Toorak in Melbourne. Illustration: John Shakespeare

The report, commissioned by NBN, said the number of sole traders had increased by 3700 in the 12 months to June 2015, taking the total to almost 1.2 million.

It said new technology including virtual reality, video collaboration, data analytics, cloud computing and Fintech were contributing to the growth in start-ups.

Mr Salt said the days of car manufacturers or companies such as Alcoa coming from overseas to Australia to hire thousands of workers on local pay rates were over.

"We have to create our own jobs of the future," he said. "Therefore any level of entrepreneurship should be encouraged."