Angel Investors

Angel Investment: A Guide for Early-Stage Businesses

If your business is in the early stages, especially pre-revenue or without a credit history, accessing traditional loans can be tricky. Angel Investment offers an alternative, where experienced individuals invest their own money in exchange for a share in your business, typically 10 to 25%. It’s not just about funding — Angel Investors often bring valuable mentoring, contacts and business insight to help you grow.

Angel Investors can work alone or as part of a syndicate (a group that invests collectively). Typical investments range from £15,000 to £500,000, sometimes more. Larger syndicates or support from schemes like the Angel CoFund can increase funding potential. The UK Government also supports Angel Investing through its Seed Enterprise Investment Scheme (SEIS) and Enterprise Investment Scheme (EIS) which offer tax incentives to investors and encourage early-stage business growth.

Benefits of Angel Investment

Angel funding can bring more than just money. Investors often offer:

Expert mentoring and strategic support
Industry connections to accelerate growth
Validation and credibility for future investors
No loan repayments or interest as it’s an equity-based investment

You’ll typically retain control of your business, especially where the investor holds a minority stake (under 30%).

Government-Backed Investment Schemes

To reduce risk for investors and support growing businesses, the UK Government offers:

Seed Enterprise Investment Scheme (SEIS) – ideal for very early-stage businesses, allowing up to £250,000 investment
Enterprise Investment Scheme (EIS) – for more developed businesses, allowing up to £5m in annual investment

Both schemes offer generous tax reliefs and help keep founders in control of their companies.

Group of business people smiling and shaking hands

Things to Consider

Angel Investment does involve giving up some equity, and investors will expect a significant return — sometimes 10x their investment within 5–7 years. You’ll also be working closely with them, so it's vital to find someone who understands your vision and sector. Always carry out due diligence to make sure the investor is the right fit.

Is Angel Investment Right for You?

Angel Investment may suit businesses that:

Are in the early stages but have strong growth potential
Need funds for hiring, product development or entering new markets
Are comfortable sharing ownership and working collaboratively

Funding typically takes 2–6 months to secure, with an investment horizon of 3–8 years. Angel Investment is regulated by the Financial Conduct Authority, and investors must self-certify as high net-worth or sophisticated.

Ready to Connect?

If you think Angel funding might be right for your business, here are some great places to start:

Explore the Angel Investment Network — the UK’s largest online platform connecting start-ups with private investors.
Learn more about Angel Investors on the British Business Bank site — including tips on preparing your pitch and what investors look for.