FSB was originally known as the National Federation of Self-Employed (NFSE). It was founded in 1974 by Norman Small in response to the introduction of Class 4 National Insurance contributions, which represented an additional tax burden on the self-employed and the owners of small businesses.
Small invited anyone affected by the new tax to attend a meeting in his home town of Lytham St Annes. At that meeting he put forward the idea of an organisation designed to promote the voice of the self-employed.
Similar meetings in other parts of the country followed and within nine months the NFSE had a membership of 25,000 with 200 new members joining every day.
The current name for the organisation was adopted in 1991.