Equity funding in 2026 – control the controllables
Date: 19/12/2025 | Corporate
As a new year approaches and people are making plans, many companies will be thinking about raising equity funds from new angel or VC investors.
Fundraising rounds are stressful and finding an investor requires a thick skin. There are usually a lot of nos before you get a yes, so resilience is vital. You think your company can conquer the world but convincing investors to part with their cash is always a challenge.
To keep motivated during the search for funds, it’s helpful to think about how investors make their funding decisions. There are things you can control, things you can’t, and things you can influence – understanding these can help you to manage the stresses and strains of the fundraising process.
What you can control
Pitch deck – make sure it’s short and to the point and that you know it inside out including the numbers. The assumptions and figures in it need to be validated and realistic and your pitch needs to be compelling. If you are not able to clearly explain how and when the company will make money, you will struggle to get investment.
Cap table – make sure it’s as clean as possible. Investors don’t like messy cap tables –they want to invest in a simple clean share structure. If there are small stray shareholders, exited founders with residual rights or early-stage investors with preferential rights and controls, get these sorted out as far as possible before you start fundraising and get commitments from those parties that they will surrender these rights as part of the new round. This is always a sensitive issue and handling it before new investors get involved will give them confidence in the company and its management team.
Who you pitch to – do your research thoroughly. Look at investors websites to make sure you fit their investment criteria, check what other investments they have made recently and come up with a reason why you are a good fit for them. It could be sector, size of funding round, location or stage of development – you need to lead with that. Taking a scattergun approach just wastes time and energy. Cast the net wide,. There are lots of overseas fund and family offices looking for opportunities in the UK as well as funders based here.
What you can’t control
History – if an investor has previously backed a company that’s similar to yours in some way and it hasn’t turned out well, the chances of getting them to fund you are slim. There is nothing you can do to change that negative experience.
Workload – if the investment team have a couple of deals on already, whether they are new investments or portfolio companies needing further funding, then they may not have the bandwith to look at new opportunities. If you are struggling to get engagement its worth asking if it’s a capacity issue and working out when would be a better time for them.
Availability of funds – it is always worth asking up front whether the investors actually have funds available to invest within your proposed timeline – not always a given as there may be internal restrictions or approvals you are unaware of.
What you can influence
Investors may not like any one of the following:
- The market;
- The product; or
- The management team.
They may be cautious about the market you are in, or they may be ok with that but feel that your product isn’t going to get the market share you think it will. On the other hand they might like the market and the product but think the management team are not up to the task.
On the positive side, you know more about all three of these things than the investors do so it’s your job to persuade them, using your greater expertise and in depth knowledge, that investment in your company is a good idea.
That being said, if certain issues are being raised by multiple potential investors then it’s worth thinking about taking that feedback on board and updating your pitch to address any valid concerns.
Persistence is key
It is always worth remembering that rejection isn’t personal. Often there are reasons for it that are outwith your control. Sometimes you can find out what they are and sometimes not, but don’t automatically assume it’s always something wrong with what you are offering.
Getting investment on board requires persistence – inevitably you will have to talk to more potential investors over a longer period of time than you would like. Hopefully 2026 will be a fairytale year – you may have to kiss a lot of frogs before you find your prince but finally there will be a happy ending.
