Funding types for businesses seeking investment

Equity investment

Equity investment means raising money by selling a share of the business. Investors take a stake and share in the future success (and risk) of the company. It is the most common route for growth-focused businesses that want capital without the repayment obligations of debt, and it is where much of InvestorMap's investor matching focuses.

Angel investment

Angel investors are individuals who invest their own money into businesses, usually at an earlier stage. Beyond capital, many bring experience, contacts and sector knowledge. Angels vary widely in the sectors, stages and deal sizes they consider — which is exactly why matching against real criteria matters rather than approaching a generic list.

Venture capital

Venture capital (VC) firms invest institutional money into businesses with strong growth potential, typically from seed or Series A onwards. VC tends to suit companies pursuing rapid scale and comfortable with the expectations that come with institutional investment. Fit is specific: each fund has a thesis around sector, stage and cheque size.

Growth capital

Growth capital is investment into more established businesses that are already trading successfully and want funding to expand — new markets, new products, acquisitions or capacity. It sits between early-stage venture and later private equity, and appeals to investors looking for businesses with a proven model and a clear expansion plan.

Equity crowdfunding

Equity crowdfunding raises smaller amounts from a larger number of investors through an online platform, in exchange for equity. It can build a community around a business, but it is a public campaign you run yourself — a different model from the curated, managed investor approach InvestorMap provides.

Convertible notes & SAFEs

Convertible notes (and SAFEs — Simple Agreements for Future Equity) are instruments that let a business raise money now and convert it into equity later, usually at the next funding round. They can be quicker and simpler than a priced equity round, which is why they are common at the earliest stages.

Venture debt

Venture debt is borrowing — often used alongside equity — that lets a business raise capital without giving up as much ownership. It typically suits companies that already have investor backing and predictable revenues, and want to extend their runway between rounds.

Other routes

Businesses also use family and friends funding, grants, revenue-based financing, mezzanine and bridge financing, private equity and strategic corporate investment, among others. The right mix depends on stage and circumstances — see Investment Stages for how these map to where a business is in its journey, and SEIS / EIS for tax-efficient equity routes.

Debt or equity — the basic trade-off

Most funding routes are a version of one of two things: selling a share of the business (equity) or borrowing money you repay (debt). Equity brings investors who share the risk and the upside but means giving up some ownership; debt keeps ownership intact but must be serviced and repaid regardless of how the business performs. Many businesses use a combination — for example equity for growth alongside venture debt to extend runway between rounds. The right balance depends on your stage, your appetite for dilution and how predictable your revenues are — part of what the free initial assessment helps you think through.

Matching the route to the right investors

Understanding the options is one thing; reaching investors who back that route is another. InvestorMap researches investor criteria across our UK and international contact base and matches your opportunity to the investors most likely to consider it. See Find Investors for how investor matching works, or start with a free initial assessment.

Frequently asked questions