What Investors Look For at Pre-Seed (UK)
The things UK pre-seed investors weigh up, from the team to early proof, with typical round sizes and tax checks.
What pre-seed means
Pre-seed is the earliest outside round. A guide from Rapid Formations, updated in October 2025, describes it as the idea stage, where you may have a concept, a prototype or early market research but no finished product or significant revenue. The money is there to test assumptions and build a first version.
Because there is little to measure, investors look closely at the people and at the quality of your thinking. This is general information, not financial advice.
Definitions vary between investors. Some call anything under a certain size pre-seed, and others use the word for any round before a product has paying customers. Ask each investor what they mean, so you pitch to the right bar.
The team comes first
Rapid Formations says a strong team can matter more than the product at this stage. Paul Graham's essay on what investors look for puts founders at the top as well. He describes the most important quality as founders who seem likely to get what they want regardless of the obstacles.
The British Business Bank's guidance, drawn up with UK Business Angels Association leadership, says angels invest in you as much as your business. So show why you can build this: relevant experience, evidence of speed and the way you handle setbacks.
If you are a solo founder, say how you will fill the gaps, whether through a hire, an adviser or a co-founder you are courting. Investors will ask, and a clear plan is better than a hopeful pause. Include a line on why you are working on this problem. Personal reasons, years in the industry and a failed attempt at a similar idea all give investors something real to hold on to. Keep it short and true.
A real problem and a clear solution
Rapid Formations lists an urgent, well-defined problem paired with a viable solution among the main things pre-seed investors want to see. Say who has the problem, how they cope today and what it costs them.
Y Combinator's seed deck guidance asks for particulars of how the problem affects real people or businesses. A named customer type and a concrete cost are more convincing than a large market figure.
Keep the solution description plain. If a customer cannot say in a sentence what your product does for them, an investor will struggle too. Write that sentence first and build the deck around it.
Early proof, however small
Rapid Formations notes that even modest signs of progress make a difference: a working prototype, a handful of pilot users or early expressions of interest show an idea moving from theory towards reality. Customer interviews and waitlists belong in the same bucket.
Paul Graham says an early company needs to look like a promising experiment worth funding to see how it turns out. Show what you have tested, what you learned and what you will test next.
Be exact about what the proof shows. Ten interviews with buyers who confirmed the problem is real is a clear result. Call it that, and do not stretch it into a claim about demand that the evidence cannot support.
A market worth winning
Paul Graham describes investors wanting a plausible path to owning a big piece of a big market, and he asks the 'why now' question: if the idea is so good, why has nobody done it already? Have a clear answer ready.
Rapid Formations adds that investors want evidence you understand your customers and their needs. A short, honest account of who buys first and why is better than a vast total addressable market.
Know your own market well enough to answer detailed questions. Paul Graham's advice is to know everything about your market. At pre-seed that depth of knowledge is often the best sign you can show of how the company will run.
Round size and what you give up
The Rapid Formations guide puts typical UK pre-seed rounds between £100,000 and £500,000, with some founders raising less from friends and family and others raising more than £1m. It says investors typically take 10 to 20% of the company.
Treat those as a rough guide from one publisher. The right amount is whatever funds the next milestone, and I'd work that out from your plan. The British Business Bank describes the typical angel-backed company as seeking £15,000 to £500,000.
Whatever you raise, show the plan behind the figure. Break it into hires, product work and sales spend, and say what you expect to have achieved when the money runs out. Investors back milestones.
Tax relief and readiness
Many UK pre-seed investors want SEIS or EIS. HMRC sets SEIS company limits of £250,000 raised in total, gross assets of no more than £350,000, fewer than 25 full-time equivalent employees and a qualifying trade under three years old. Check whether you qualify and consider applying for advance assurance before you pitch.
The British Business Bank's checklist also asks you to be ready for regular reporting and scrutiny after you take the money. Investors notice founders who have thought about that.
Gather your key documents before you start: a short business plan, forecasts, the cap table and the shareholder register. HMRC's advance assurance application asks for most of them, so you do the work once and use it twice.
Know the market you are raising in
The British Business Bank's 2026 equity tracker reports that seed deal numbers fell 27% in 2025 and that seed-stage companies took longer on average to secure funding. Plan for a longer process than you might hope, and keep more investors in play than you think you need.
Paul Graham's advice is to keep working on the company during the raise, because investors lose interest in a company that has stalled. InvestorUniverse helps with the first step by ranking UK investors against your stage, sector and cheque size, so you spend your time on the people most likely to say yes.
Ask investors how long their process takes and what they need from you at each step. Then plan your cash around the answers. A round that closes later than expected is easier to survive with six months of cash than with two.
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Find my investorsSources
- Rapid Formations: The ultimate guide to pre-seed funding for UK startups
- Paul Graham: How to Convince Investors
- Paul Graham: Fundraising
- British Business Bank: Your journey to angel investment
- British Business Bank: Angel investment checklist
- British Business Bank: Small Business Equity Tracker 2026
- HMRC: Seed Enterprise Investment Scheme
- HMRC: Apply for advance assurance
- Y Combinator: Intro to the YC Seed Deck