Fundraising is one of the most important, but perhaps most misunderstood, processes in the life and evolution of a growing technology business. Most founders understand that businesses will need money to grow – and to start with most will have been spending their own. But understanding how much is needed for the future, where it might come from, and how to get it – well that’s something else.
This guide is designed to help company founders better understand and navigate the steps involved in securing the funding they need to achieve their goals – and hopefully ease some of the stress along the way. It’s important to remember, though, that every company is different, every founder is different, and as such, every fundraising journey will be unique.
Why fundraising is more than just money
It’s worth stating upfront that fundraising is never just about money – it’s about building partnerships. The right investor can help in ways more valuable than offering money alone. But like any relationship, fundraising can be a journey that tests your resilience, vision, and clarity of purpose – it can be hard at times.
Whether you’re raising seed funding for the first time or scaling towards working with larger investors, the process demands preparation, patience, hard work, and adaptability. Also, you will rarely only do this once: every stage builds on the last.
The good news? With structure, preparation, realism, and the right mindset, fundraising can be a powerful accelerator for your business.
Now, let’s dive into the fundraising journey step by step.
1. Make the decision to fundraise
Before any pitch deck is built or any email is sent, the first, and most fundamental, step is simply making the decision to raise external capital. It sounds simple, but this is a psychological leap as much as a business one.
Fundraising means entering a partnership. It requires founders to share control, align with investors, and accept that future decisions will be made collaboratively. If that idea feels uncomfortable, it’s worth pausing before you proceed. Maybe fundraising isn’t the right path for you.
It’s a big decision, since most founders will be used to doing things their own way. They’ll know every part of their business and every nuance of their plans. Taking on a new partner who will want some involvement in the future, however small, can be a challenging decision.
At its core, the choice is between two paths:
- Bootstrapping, where a business grows organically using internal resources and revenues – effectively reinvesting any profits – maintaining ownership but accepting slower growth and potentially limited options.
- Fundraising, where you trade equity for the money and expertise needed to accelerate your roadmap.
Neither is right or wrong. It’s a question of matching your ambitions to your resources and risk appetite. It has to feel right. But those who succeed at fundraising usually make the decision early and deliberately. They understand what they want to achieve, why external funding is necessary, and what they’re willing to share in return.
2. Plan your fundraising journey
Once you’ve overcome some psychological hurdles and made the decision to raise external finance, planning begins. This stage may separate the prepared from the hopeful.
At its simplest, planning means translating your vision into a growth journey that’s convincing and, critically, grounded in numbers: what do you want to achieve, how much will it cost, and what milestones will demonstrate progress? Ultimately, where are you heading and what might be in it for an investor?
It’s important to remember that investors are not just buying your idea; they’re buying your execution plan. That plan should include:
- A clear vision for the product, market, and opportunity.
- Financial modelling that realistically outlines costs, growth assumptions, and cash needs.
- Defined milestones, showing how each funding stage supports measurable outcomes.
- A use-of-funds narrative that explains why every pound matters.
This is also the moment to evaluate your funding options. Venture capital is one route, but there are others. Angel investors, family offices, corporate ventures, public co-investment funds, and strategic partners all have different priorities, expectations, and timelines.
It’s worth spending time researching the pros and cons of all. Doing this work upfront will save a lot of time later. There’s little point pitching to a fund whose minimum investment level (known as a ticket) is £5 million when all you need is £100,000. And consider who you know. The ideal investor might already be known to you.
Perhaps most importantly, this stage is about storytelling. Fundraising is an exercise in communication. Investors must understand your story quickly: the problem you’re solving, the traction you’ve achieved, and why your team is uniquely positioned to win.
Be clear, but stay flexible. The best founders hold strong convictions but are open to refining their approach as they receive feedback from the market.
3. Get investor ready
‘Investor ready’ is one of the most overused phrases in fundraising, but it’s also one of the most important. Being investor ready doesn’t just mean having a good idea. It means having your materials, your data, and your mindset ready for scrutiny.
Some key materials you will need include:
- A concise pitch deck (10–15 slides).
- A clear executive summary of your proposition.
- A financial model that links forecasts to strategy.
- A simple table showing the ownership structure.
- A data room (often digital) that contains due diligence materials: legal documents, contracts, intellectual property (IP) rights, customer metrics, and forecasts.
But beyond the paperwork, investor readiness is about credibility. Investors assess these three things:
Credibility – Is your narrative consistent? Have you achieved what you said you would since the last conversation?
Reliability – Do you respond quickly, deliver on promises, and handle communication professionally?
Trust – Do they believe you’re someone they want to work with for the next five years?
A founder who’s credible and responsive can often compensate for early-stage imperfections elsewhere. A ‘prepared mind’ is what every investor looks for. It signals that you’ve thought through scenarios, anticipated tough questions, and are ready to engage meaningfully.
To find out more about getting investor ready, read our guide, which includes an investor-readiness checklist.
4. Outreach and building relationships
Once your materials are ready, it’s time to engage. But fundraising outreach is not a scattergun exercise: it’s strategic, methodical, and ultimately a relationship-building exercise.
Think of it as a courtship. Investors rarely commit after one meeting. They observe, question, and build conviction gradually. This process can take time. While it’s impossible to put any minimum timeframe on this, it’s not unusual for this process to last six months or more.
Start earlier than you think
One good piece of advice is to build relationships before you need the money. Founders who start conversations early, whether that be at conferences, pitch events, or through mutual connections, gain a huge advantage. When the time comes to raise, those relationships are already warm.
Be strategic
Research investors’ portfolios. Be methodical in who you approach – and how. Target funds that invest at the stage of your business and in your sector. Personalise your outreach.
Communicate clearly
After each meeting, send a concise follow-up summarising key points and next steps. Investors often say that poor follow-up is one of the most common reasons good businesses lose momentum.
Above all, remember that people do deals with people. Data is important, but trust and rapport drive decisions. Investors want to know that when challenges arise - and they will - you’ll communicate openly and collaborate constructively.
5. Negotiation and due diligence
Once an investor expresses serious interest, you move into negotiation and due diligence. This is where principles meet practice. Investors will test your assumptions, your forecasts, your hiring plan, your route to market. They’ll want to understand not just what you’re doing, but how you’ll respond when things don’t go to plan.
Expect this period to be rigorous and challenging. Investors aren’tt trying to trip you up; they’re trying to validate that their trust in you is well placed.
You should expect due diligence to cover:
- Financial review (revenues, margins, forecasts).
- Legal and IP checks (ownership, contracts, liabilities).
- Team due diligence (key roles, commitments, equity).
- Market validation (competitors, customers, scalability).
Throughout this stage, communication is everything. If an issue arises - perhaps a contract is unsigned or IP protection incomplete - acknowledge it, explain how you’re addressing it, and follow up. Transparency builds trust; avoidance kills it.
6. The legal process
Once heads of terms are agreed, lawyers draft the detailed documentation. This can take anywhere from four to ten weeks, depending on complexity and responsiveness.
Founders sometimes underestimate how detailed this process is. Each clause, from board rights to liquidation preferences to warranties, matters. Seek advice, ask questions, and understand what you’re signing.
7. Closing the deal
When terms are finalised and documents are signed, the funds are transferred, and the deal is done. But that’s not the end – far from it. It is the beginning of a new journey.
Closing the deal marks a shift in relationship. You now have partners in place who have believed in your vision enough to invest – to give you money. You will now share in both the risks and rewards ahead. But you’re also one team now – it’s an important and rapid shift in the dynamic.
Fundraising timeframes
How long does it take to reach this point? Realistically, for most early-stage tech businesses:
That’s roughly six to twelve months end to end, assuming steady progress. Deals can close faster. Some close within five or six weeks. But that’s the exception, not the rule.
An important variable is almost always responsiveness. Founders who drive the process, schedule regular check-ins, and keep communication flowing move faster. Weekly updates can make the difference between momentum and drift.
Tips on accelerating the process
While there’s no magic shortcut, there are ways to potentially speed things up:
1. Start early. Build relationships before you need the capital.
2. Be organised. Keep a live data room and up-to-date financials.
3. Be clear on your ask. Know exactly how much you’re raising and why.
4. Drive the process. Take ownership of follow-ups and timelines.
5. Seek advice. Mentors and experienced founders can help you avoid common pitfalls.
6. Communicate openly. Momentum thrives on clarity.
In summary
It’s important to remember that fundraising is both a financial and psychological journey. It’s not just about securing capital, it’s about building partnerships that can accelerate growth, build value, and help achieve your goals. Successful founders treat the process as ongoing: they plan early, communicate clearly, and are always investor ready.
Preparation is key. A solid business plan, credible data, and a compelling story will give investors the confidence they need. Founders should focus on creating real value between rounds, hitting goals, maintaining commercial traction, and advancing their product or offering.
Relationships are at the heart of every fundraise. Investors back people as much as ideas, so trust, consistency, and responsiveness matter as much as financial metrics. Negotiations and due diligence are rigorous, but they can also help build trust.
Finally, remember that closing a deal does not represent the finish line - it’s the start of a new partnership. The best founders understand that raising capital is about aligning ambition with discipline, securing allies, and laying the foundation for long-term value creation. Prepare early, communicate always, and stay focused on the end goal.
