Planning to scale your business? Then you need access to the right funding otherwise you’re unlikely to grow as significantly as you want!
Becoming investment ready is not just a quick tick-box exercise. It can take months to be prepared adequately, and involves providing accurate financial reports, getting those reports in order to satisfy your potential investors, and even applying for advance assurance from HMRC in case of SEIS or EIS. Readiness can in fact start years before to ensure a good legal compliance history leading into due diligence*.
One option is equity funding from private investors, either directly or through a crowd-funded option such as Seedrs.
What is SEIS or EIS?
The SEIS (Seed Enterprise Investment Scheme) and EIS schemes are initiatives designed to help companies raise investment in the early years of starting up. By offering generous tax relief to investors, these schemes encourage investors to invest in qualifying companies. The investment must be used within 3 years from the share issue date and must be used for either trade or research and development. Through SEIS investment, investors can claim 50% tax relief, and through EIS they can claim 30%.
Here’s the basics of the different rounds involved:
A start-up looking at a pre seed round are likely to be pre-product and pre-launch and really be only a small ideas focused team: basically a minimum viable product. The goal of a pre-seed is to maximise the potential future fundraising opportunities through testing.
A startups at this level already has a validated value proposition: a monthly revenue which is consistent, constant and the business is growing month on month. The Startup needs its next level of funding to scale, grow and become a competitor in the current market place.
Series A financing tends to occur when the Startup is generating strong revenue from its business model, but the business isn’t likely to be generating net profits at this point. Most series A investors will be venture capital funds or angel investors who are willing to accept the high levels of risk found in these early-stage company investments. This round is to scale a product nationally or internationally.
We can prepare your forecasts and other financials based on the data and information you supply to us. We’ll do this in a timely manner, and will be available to chat through any queries you might have.
We may even be able to introduce you to investors based on the size of investment you need and the purpose.
Investment Readiness: Watch the 2 part webinar!
You can also get some top do’s and don’ts here.