Once you’ve closed a Series A round, your business will have a well-defined business model, real product demand and a growing base of paying customers.
This is the stage where the focus moves from proving the idea to scaling the business. A Series B funding round supports this next phase of growth. It helps you enter new markets, reach more customers, build a bigger team and invest in technology and marketing.
What is Series B funding?
Series B funding is the next major venture capital round a startup raises after Series A. In the UK, these rounds usually range from £10 million to £50 million or more depending on the company’s growth plans and funding needs.
Raising capital has become more competitive in the current economic climate. Recent OECD forecasts suggest subdued UK growth and persistent inflationary pressure, contributing to a more selective fundraising environment for scale-ups.
Even so Series A and Series B were the most resilient funding stages in 2025, accounting for 65.5% of total deal value, according to Marks Sattin’s UK Private Capital Breakdown 2025. Scaling successfully in this climate calls for a proactive approach backed by solid financials.
In this guide, we explain the key differences between Series A and Series B, how to assess the right time to raise, how to prepare, where to find investors and which alternative funding options to consider — all from a finance perspective.
What’s the difference between Series A and Series B funding?
Feature | Series A | Series B |
Primary goal |
Validate product-market fit and support early growth
|
Scale the business, enter new markets, and optimise operations
|
Typical funding size |
£2–£10 million
|
£10–£50+ million
|
Investor profile |
|
|
Use of funds |
|
|
When is the right time to raise Series B funding?
Most startups consider a Series B round once they see clear signals such as:
- Consistent revenue growth
- Stable operational processes
- A team that can scale quickly
- Clear evidence of market demand and product-market fit
- A healthy balance between customer acquisition cost and lifetime value
Raising Series B too early can strain cash flow and operations while waiting too long can lead to missed growth opportunities.
How to prepare for Series B funding?
Here are a few key steps to take:
1. Get your financials investor-ready
At this stage, investors will take a close look at your revenue, margins, cash flow, historical performance, and forecasts for the next 12 to 24 months. This makes it essential to have accurate and up-to-date financial records in place.
Consistent monthly management accounts and board reporting also become increasingly important as investors expect greater operational visibility at Series B stage.
You should also track key metrics such as customer acquisition cost (CAC), lifetime value (LTV) and churn rate. Your forecasts need to be realistic and clearly linked to your growth plans and current market conditions.
Investors may also assess capital efficiency metrics such as burn multiple and payback period to understand how effectively growth is being funded.
2. Build a winning pitch deck
Your pitch deck must tell a data-backed story. At Series B, investors expect to see:
- A clear business overview and growth journey
- The market opportunity you are addressing
- Your expansion and scaling plans
- Financial performance and future projections
- How the funds will be used
- Expected outcomes from the raise
- The strength of your leadership team
Most investors spend only two to three minutes reviewing a deck. A well-structured and jargon-free investor pitch deck is far more likely to hold their attention and lead to a follow-up discussion.
If you are presenting live, keep text to a minimum and focus on clean and engaging visuals. If you are sharing a teaser deck by email to secure an initial conversation, aim for a high-level snapshot rather than detailed explanations.
3. Get due diligence ready
Due diligence at Series B is far more detailed and thorough. Investors will usually ask for a wide range of documents including:
- Corporate governance documents and statutory records
- Customer and supplier contracts
- Shareholder agreements and your cap table
- Intellectual property and legal compliance records
- Operational policies and HR documentation
Investors may also review financial controls, reporting consistency and historical management accounts to assess operational maturity and forecasting reliability. Having these documents prepared in advance helps speed up the process and shows operational readiness.
4. Set Anti-dilution provisions
New funding rounds can dilute existing shareholdings and reduce the value of earlier investments. Anti-dilution provisions are designed to protect investors if future shares are issued at a lower valuation than earlier funding rounds. The commercial impact varies significantly depending on whether the mechanism uses weighted-average or full-ratchet protection, making careful negotiation important for both founders and existing shareholders.
5. Review exit and liquidity clauses
Series B investors often negotiate liquidation preferences. This means they receive their investment back before earlier investors if the company exits. In some cases, this can reduce or eliminate returns for seed and Series A funding shareholders.
Carefully reviewing and negotiating these terms is essential. It allows you to raise the capital you need to scale while protecting the long-term interests of the business and its shareholders.
Where to find Series B investors?
At this stage, some Series A investors may choose to increase their stake. New investors may also join the round. Common Series B investors include:
1. Venture capital firms
Later-stage venture capital firms such as Index Ventures and Octopus Ventures often lead Series B rounds. They look for businesses with strong revenue growth and a clear market position.
2. Private equity investors
Private equity firms like BGF invest in late-seed to Series B deep-tech and life sciences startups across the UK and Ireland. They also support growth-stage SMEs with funding, sector expertise and follow-on investment.
3. Institutional investors
Large institutions such as pension funds and asset managers may participate in Series B if the business demonstrates strong growth potential.
Alternative funding methods to support a Series B
Series B funding is not the only way to scale your business. Depending on your goals and risk appetite, you could consider:
- Debt financing: Loans or credit facilities can fund expansion without diluting equity.
- Venture debt: Venture debt can also supplement equity funding for businesses with strong recurring revenue and institutional backing.
- Revenue-based financing: Repay investors based on your revenue performance, aligning funding with business growth.
- Strategic partnerships: Work with other businesses to access new markets or gain capabilities.
- Crowdfunding platforms: Although unconventional at this level, platforms like Crowdcube let the public invest alongside traditional investors and expand your funding base.
- Angel investors: Some angel investors may participate in Series B. If you want to raise angel investment at this stage, they can help support growth initiatives, open new networks, and offer mentorship alongside funding.
To decide whether debt or equity fundraising is the better option for your business, check out our Debt vs Equity Fundraising Guide.
Regardless of the startup funding route, strong financials and strategic planning are essential to attract investors and support sustainable growth. At Rise Accounting, we help businesses prepare for every stage, ensuring financial readiness, compliance and long-term planning. Contact our team here to learn how we can support you.
Frequently asked questions
How long does it take to raise a Series B?
A Series B process commonly runs around four to six months from your first investor conversations to funds landing, with detailed due diligence taking up a good part of that. Timelines slip easily, so it is sensible to start while you still have plenty of runway rather than raising against a deadline.
How long after Series A do companies raise Series B?
There is no fixed gap. Many companies raise Series B somewhere between 10 and 18 months after Series A, and some take considerably longer. What matters more than the calendar is whether the growth signals are in place, consistent revenue, stable operations and evidence that further capital will convert into scale. Raising before those are established tends to be harder regardless of timing.
How much equity do you give up at Series B?
It depends on your valuation and how much you raise, so treat any single percentage with caution. As a rough guide, founders often part with around 15% in a Series B round, though a stronger valuation lowers that for the same amount raised. The anti-dilution and liquidation terms you negotiate can matter as much as the headline figure, so it is worth modelling the full picture rather than fixing on one number.
What is a typical Series B valuation?
Valuations vary too widely for a single reliable benchmark. They turn on your growth rate, margins, market size and how competitive your raise becomes. The more useful question is what your own metrics support, since that is what investors actually price against. For any help, feel free to reach out to our team.
Does your Series A investor need to lead the Series B?
No. A new outside investor leading your Series B is normal and expected. The stronger signal to the market is whether your existing backers follow on and take up their share, since that shows continued confidence from people who already know the business well.
Subhashree is an ACCA-qualified accountant and Director at Rise Accounting, where she heads up the accounting function. She brings deep technical expertise across compliance, management accounts, year-end reporting, and day-to-day financial operations for SMEs.
