Equity finance can be very beneficial in helping your business expand and grow. Investors will be prepared to back your business if it has potential for high growth.
The Government works with private sector partners to increase the availability of equity finance through the Angel CoFund and venture capital programmes.
Venture Capital firms invest in early-stage companies in return for an equity stake. They typically provide finance from £500,000 up to £5m in companies with early revenues and strong traction and may co-invest with other firms.
The firm takes a board position in the business to work closely with the management team on strategy and operational improvements.
Business Angels are private investors in your business. Each year private investors account for between £800m and £1 billion of early stage investment in the UK, making them the single largest source of early stage capital.
An individual angel will typically invest between £10,000 and £300,000, but syndicate groups will provide up to around £1-2m.
Private Equity fund managers tend to invest in slightly later stage, more profitable companies, which they believe will provide a high capital return in a relatively short timescale.
They’ll often take a majority equity stake with a board position to work alongside the management team on performance, strategic direction and operational improvements.
More about the options available if you’re looking for equity finance or venture capital can be found by searching our Support Finder.