BUSINESS & MONEY
Funding a London startup: grants, loans, angels and venture capital
The right capital matches the company’s stage, risk and route to revenue. Funding is not a substitute for evidence that customers want the product.
- Decision points
- 5 useful sections
- Reading time
- 1 minutes
- Source checks
- 1 named checkpoint
- Last reviewed
- 2 SEPTEMBER 2026
Start with the use of funds
Define how much money is needed, what milestone it buys and what happens if growth takes longer. Product validation, inventory, regulated approvals and sales hiring create different financing needs. Keep founder living costs separate from company assumptions.
Use revenue and grants where they fit
Customer revenue preserves ownership and tests demand. Grants can support eligible innovation or local outcomes but are competitive, restricted and reporting-heavy. Never build the whole company around winning one programme.
Understand debt
Loans preserve equity but require repayment and may involve personal guarantees, security or credit assessment. Model the payment during a slow sales period, not only the optimistic forecast. Read the annual cost and default terms.
Prepare for equity investment
Angels and venture funds buy ownership and expect a path to substantial return. Prepare evidence on market, product, traction, team, competition, economics and legal ownership of intellectual property. Choose investors for fit and behaviour as well as cheque size.
Run diligence both ways
Verify the investor or intermediary, fees and authority to transact. Keep a clean cap table, records, contracts and financial model. Use qualified legal and tax advice for binding terms; introductions and pitch events do not replace due diligence.
