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What it Takes to Secure Funding for Your Tech Business

· Abigail Beall · Opinion

Ten tips for getting investment.

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Get your business off the ground with these tips on securing investment…

2019 brought an all-time record of £10.1 billion worth of tech investment in the UK. So, what does it take to make sure your business gets a piece of this pie? Securing funding can be more of a challenge up north compared to in London, where the majority of venture capitalists are based. You need to know all the tricks of the trade to get the investment you so rightly deserve, so without further ado, here are 10 key factors a business needs to nail down that much-needed cash injection.

A Real Problem

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According to Charlotte Scott, Entrepreneur Manager at NorthInvest, the first thing any business needs is to demonstrate a problem. “We need to see a really clearly defined problem within the market,” she told us. “You need to be able to say, ‘this is a problem experienced by x% of this market and it’s a top priority for these people.’”

In defining your problem, the specifics are key. It’s important to avoid vague language and to demonstrate what the market demand is, using statistics or evidence.

A Must-Have Solution

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After demonstrating a problem, you need to show you have a viable solution. Your solution should be in the early stages of development or already developed, not just at concept stage. It needs to be a must-have solution for the people experiencing the problem. Then you need a revenue model to show how you’ll make money from it.

Try to think of an ‘elevator pitch’, a way to sum up your company in a really short time, the time you have if you’re sharing a lift with someone. This can help to define your USP by summing it up in a one-liner which puts across both your product and your company’s mission.


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An investor is much more likely to put money into a business that’s already started to establish itself. Perhaps you can demonstrate traction through ongoing discussions with corporate partners or maybe you have a base of free subscribers who could potentially be converted into paying customers?

This all depends on the kind of business you’re building, but you need to tell the story of your company to date including key milestones and growth. Customer testimonials, press coverage or accolades can be a great way to prove that other people believe in your business too.

The Numbers

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You need to know your numbers – market size, customer base, revenue streams and financials, it’s all crucial to success. Think about your key performance indicators in terms of the worst-case scenario. If you were to only reach 1% of the market, would you still be sustainable as a business? Be clear on the funding you want, what you’ll do with it and the percentage of equity you are willing to give away.

You need to know what your company is worth, but in the early stages, company valuations are always negotiable. Tech companies have been heavily inflated in the past few years, so don’t get hung up on one evaluation. At the end of the day, your company is only worth what someone will pay for it.

A Growth Plan

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You have to know what your route to market will be, including where your customers look and how you’ll find them. Push yourself apart from others offering similar products or services. Identify which channels you’ll be using to find customers and win them over to your brand. Include three to five years of financial projections.

Set target growth rates and a plan of how to achieve them, to make sure they’re realistic. In this, include the critical assumptions you’re making in terms of expenses, customer conversion and market penetration.

An Exit Strategy

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Investors will want to know what your plan is after you’ve grown your business. Are you going to grow to a certain size then sell to a bigger company or are you planning to stick around forever? What you’re hoping for as a founder will have a big impact on the return on investment for anyone putting money in.

Have a plan for what you will be doing with the company in the next five, eight or ten years, so investors are confident that you know where you want to go and what you want to do next.

A Brilliant Team


People matter. They’re not just investing in your idea, they’re investing in the team behind it. It’s very unlikely that anyone will invest in one person. You’ll need to be part of a strong team with complementary skillsets, expertise in the market and a knack for managing people.

It also comes down to whether the investors will get along with you. “We have had companies where it’s been a wonderful idea and it’s ticked all the boxes, but at the end of the day, the founder, for whatever reason, wasn’t investable, and people have passed on it,” Charlotte explained.

A Great Network

Getting in front of the right potential investors is key, and this can often be the result of a great network. If you’re part of something like NorthInvest, they’ll be able to put you in front of investors who are more likely to take a chance on you. And if they can’t, they can refer businesses to other funding options like venture capitalists.

It also helps to work in a collaborative place like Nexus, the innovation hub at the University of Leeds or a co-working space like Platform which specialises in helping tech companies scale up. The more people you know, the higher your chances of finding the right investor.


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Investors want to know you’re committed to growing your business, so they’ll see a return on investment. One great way of showing this is if you’ve personally invested your own money. “You can’t get much more committed than that, putting your own money on the line,” Charlotte explained. “If you’re not willing to invest in your business why would anyone else?”

If you haven’t got the money to put in, you might be able to demonstrate commitment to the business in other ways. This could be in the amount of time you’ve spent growing the company so far, developing your product or doing the necessary research.

The Right Investor

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You don’t want to get just anyone to give you money. Don’t just accept the first offer of investment you’re given. To make your business successful, it’s important to find an investor who’s as passionate about your business as you are, and will help it grow and succeed.

Angel investors tend to be more hands-on than VCs. Some will end up sitting on the company board, becoming non-executive directors or overseeing and helping with strategy. “It’s a balance between finding an investor who has the money, but also one who’s willing to help it grow by offering their own network and expertise,” Charlotte explained. This is especially important at the start, because it’s a crucial stage of work for any start up.