Fundraising
How to Demonstrate Traction to Investors: A Founder’s Guide
Showing traction is critical to getting funded, but what is it and how do you prove it?
April 29, 2025
What Are Fundraising Services for Startups?
Raising capital has always been a defining challenge for startups, but the landscape has become increasingly complex. Gone are the days when founders relied solely on personal networks, traditional bank loans or a handful of well-known venture capital firms. Today, a vast ecosystem of fundraising services exists, providing startups with diverse routes to investment. These services help bridge the gap between businesses seeking capital and investors looking for high-potential opportunities, offering structure, guidance and efficiency in an otherwise fragmented market.
Fundraising services for startups range from online platforms and crowdfunding sites to specialised investor syndicates, angel networks and institutional brokers. Each type serves a distinct role in the fundraising ecosystem, catering to different investor profiles, funding stages and deal structures. Some services provide broad exposure, enabling startups to pitch to large pools of investors, while others operate within niche networks, offering curated introductions and hands-on support. The choice of service or services can influence not only a startup’s ability to secure investment but also the terms of the deal, investor engagement and long-term strategic value.
Despite this abundance of options, founders often struggle to leverage the fundraising market effectively. The sheer variety of services, differing fee structures and varying levels of investor access can create confusion, leading to wasted time, misaligned partnerships or suboptimal valuations. ThatRound simplifies this process by aggregating fundraising services into a single platform, helping founders compare and engage with the most suitable options for their stage, sector and funding goals. By gaining clarity on the diverse range of fundraising services available, startups can make more strategic decisions, optimise their investor outreach and secure funding on better terms.
History of the Equity Fundraising Market
The way startups raise capital has changed dramatically over the past few decades. What was once a market dominated by a handful of investors and a limited number of funding routes has evolved into a fragmented, highly specialised landscape. Founders today must navigate an increasing number of fundraising services, each catering to different stages, sectors and types of investment. Understanding how this shift occurred provides crucial context for why securing funding has become more complex and why ThatRound’s platform, which aggregates fundraising services, plays a vital role in simplifying the process.
Early-Stage Investment Before the Digital Era
Before the rise of the startup economy, early-stage funding primarily came from personal networks, private wealth and a limited pool of institutional investors. Entrepreneurs often relied on personal savings, family offices and bank loans to finance new ventures, with traditional angel investors occasionally stepping in to support promising businesses. Government-backed schemes and innovation grants provided additional support, but overall, access to capital was limited.
Venture capital firms played a significant role in financing high-risk, high-growth ventures, but they operated within closed networks. Startups seeking funding needed strong connections and deals were typically arranged through face-to-face introductions rather than open applications. This exclusivity meant that only a small number of businesses could access the funding required to scale, creating barriers to entry for many founders.
The Advent of the Tech Boom and Consequences for Institutional Capital
The dot-com boom of the late 1990s and early 2000s brought a surge in venture capital investment, particularly in the technology sector. Startups that demonstrated rapid growth potential could now attract funding from a wider range of institutional investors, including private equity firms and corporate venture arms. Silicon Valley became a global hub for investment, leading to the rapid expansion of the VC industry.
Institutional capital also began playing a larger role in startup funding. Pension funds, hedge funds and corporate investment vehicles started allocating capital to high-growth startups, particularly in sectors like software, biotech and fintech. As a result, funding rounds became more structured, with Series A, B and C funding rounds becoming the standard framework for scaling businesses.
The Emergence of Alternative Fundraising Channels in the Post-Banking Crisis World
Following the 2008 financial crisis, banks became more risk-averse, reducing lending to startups and small businesses. This shift, combined with advances in technology, led to the rise of alternative fundraising models. Online crowdfunding platforms emerged, allowing startups to raise small amounts from a large pool of individual investors. Angel networks became more structured, with investors forming syndicates to spread risk across multiple startups.
At the same time, investment clubs gained traction, enabling smaller investors to collectively back early-stage businesses. Specialist fundraising services also began offering tailored support to startups, helping them structure funding rounds, prepare pitch materials and connect with investors. The startup ecosystem was becoming more diverse, but also more complex, requiring founders to explore multiple channels rather than relying on a single funding source.
Increasing Fragmentation in the Equity Fundraising Market
With thousands of startups competing for investment, fundraising services have become increasingly sector-specific. Specialist venture funds now focus on areas such as deep tech, sustainability and AI, while regional investment networks support startups within specific locations. Crowdfunding platforms cater to different business models, from equity-based funding to revenue-share agreements.
As the investment landscape has expanded, so have the challenges for founders. Unlike in the past, where funding was concentrated in a few key players, startups must now approach multiple fundraising services to increase their chances of securing capital. This has led to inefficiencies, with founders spending months identifying relevant services, tailoring applications and managing multiple investor conversations simultaneously.
Where Are We Today?
Startups now face an overwhelming number of fundraising options, from digital investment platforms to institutional brokers managing large-scale transactions. While this variety increases access to capital, it also requires founders to be strategic in choosing the right fundraising route for their sector, stage and investor profile.
Platforms like ThatRound simplify the investor search by bringing together different fundraising services in one place, allowing startups to compare their options and engage with the right partners efficiently. By reducing the time and complexity involved in raising equity investment from fragmented markets, our platform helps founders focus on what matters most—building and scaling their businesses.
Different Fundraising Services for Startups
The number of individual fundraising services is vast, with a variety of intermediaries helping startups access investment. Unlike direct investor outreach, these services act as facilitators, providing startups with structured access to capital. Some services act as intermediaries, connecting businesses with investors, while others provide hands-on support, helping refine pitches, manage negotiations and structure deals.
With the rise of technology-driven investment platforms, startups now have access to more funding pathways than ever before. Crowdfunding, for example, has opened up retail investment opportunities, allowing smaller backers to support high-growth ventures. Angel networks and investor syndicates provide collaborative funding models where experienced investors pool resources to back promising startups. Meanwhile, institutional brokers and specialised fundraising services assist companies seeking larger, more structured capital raises.
Each type of fundraising service caters to different business needs, investor types and funding stages. Some prioritise early-stage capital, while others focus on scaling growth-stage companies. The fee structures also vary, with some services charging upfront costs, retainers or success-based fees. Understanding these differences allows founders to assess their options efficiently, maximising their chances of securing investment.
The sections below explore the main fundraising services available, how they operate, their typical investor base and what founders should expect in terms of costs.
1. Online Platforms
What they do: Online investment platforms provide startups with a digital marketplace where they can showcase their businesses to a broad range of investors.
These platforms are particularly effective at scaling outreach, allowing businesses to pitch to thousands of potential backers at once. Startups typically upload a detailed pitch deck, business plan and financial projections, which investors can review before expressing interest.
Unlike traditional fundraising channels, online platforms provide a self-service approach, meaning startups must manage their investor interactions independently. Some platforms specialise in early-stage funding, while others cater to later-stage businesses seeking large-scale investment rounds.
Typical investor profile: Investors on these platforms vary widely, ranging from individual angels and high-net-worth individuals to venture capital funds and growth-focused investors.
However, different platforms tend to attract different types of investors - one platform may focus primarily on early-stage angel investors, while another may cater to growth-stage VCs. As a result, startups often need to assess multiple platforms to access a diverse investor base effectively.
Many investors on these platforms look for high-growth, scalable startups with strong market potential. Some may be sector-agnostic, while others focus on specific industries, such as fintech, health tech or SaaS.
Where to find them: Startups can access online investment platforms through well-established providers that operate on a national or international scale. Some platforms specialise in UK startups, while others offer access to global investor networks. Examples might include OpenVC for venture capital-focused opportunities and AngelHive for angel investors, providing targeted networks based on the startup’s stage and sector.es to a broad range of investors.
Fee structure: Online platforms typically charge a combination of listing fees, success fees (usually a percentage of the funds raised), or subscription models for premium access. Some may also include legal and administrative costs as part of their fee structure. For a more detailed breakdown, refer to ThatRound's guide on the differences between startup fundraising services.
2. Crowdfunding Platforms
What they do: Crowdfunding platforms allow startups to raise capital from a large pool of smaller investors, often through equity-based crowdfunding campaigns. These platforms enable founders to leverage their existing network, customer base and online marketing efforts to generate investment interest. Campaigns typically involve a set funding target and in many cases, funds are only released if the target is met.
Typical investor profile: Crowdfunding investors are usually retail investors, early-stage angels and brand supporters who invest smaller amounts per person. Unlike institutional investors, they often focus on startups with strong consumer appeal and are more likely to invest based on brand affinity and community engagement rather than purely financial metrics.
Where to find them: Crowdfunding platforms are widely accessible, with major providers offering UK-focused and international fundraising options. Notable examples include Republic (Seedrs), Crowdcube and Kickstarter (for reward-based funding).
Fee structure: Crowdfunding platforms charge a success fee of around 5-8% of the total amount raised. Some also require marketing and listing fees and many impose due diligence requirements, which may add additional legal and compliance costs.
3. Investor Syndicates
What they do: Investor syndicates are private groups of investors who pool their resources to fund startups collectively. Members meet regularly to discuss potential investment opportunities, review pitches and make group-based funding decisions. These clubs often focus on early-stage startups and provide a more collaborative investment approach than individual angel investors.
Typical investor profile: Investor syndicate members are usually high-net-worth individuals (HNWIs), experienced entrepreneurs or sector specialists who prefer making smaller, diversified investments across multiple startups. Unlike institutional investors, they often take a more hands-on approach, offering advice and mentorship to founders.
Where to find them: Investor syndicates are typically invite-only or require referrals. Some operate through private networks, alumni groups or entrepreneur associations, making them harder to access than public-facing investment platforms. Examples include Sowing Capital and Found Capital, among others.
Fee structure: Investor syndicates generally do not charge fees to startups but some may levy a success fee of in the region of 5%. However, some may require membership fees from investors. Startups may also incur legal and administrative costs when structuring investment agreements.
4. Angel Networks
What they do: Angel networks are formal groups of angel investors who collectively review and fund early-stage startups. Unlike investor syndicates, these networks often have a structured application process, where founders submit pitches, undergo due diligence and present to investors in scheduled meetings.
Typical investor profile: Angel networks are composed of high-net-worth individuals (HNWIs) and serial entrepreneurs who invest their own capital. These investors typically seek high-growth startups and are willing to take early-stage risks in exchange for equity.
Where to find them: Many angel networks operate in specific regions or industries. Notable examples in the UK include UK Business Anglia Capital Group, London Business Angels and Cambridge Angels.
Fee structure: Some angel networks charge a one-time application fee, while others take a success-based commission. Legal and administrative costs may also apply.
5. Fundraising Service
What they do: Fundraising services offer specialist support to startups throughout the investment process. These services include investor outreach, pitch deck consulting, term sheet negotiations and strategic fundraising advice. Unlike other funding sources, fundraising services work closely with founders to refine their investment proposition and connect them with relevant investors.
Typical investor profile: Fundraising services work with a broad range of investors, including venture capital firms, family offices and private equity groups. These services can support both seed-stage and growth-stage investments, providing flexibility to founders at various stages of their fundraising journey.
Where to find them: Fundraising services operate through independent firms, advisory networks and specialised consultancy groups. Some focus on sector-specific fundraising, such as fintech or biotech, while others offer generalist investment support.
Fee structure: Fundraising services typically charge a combination of upfront fees, retainers and success-based commissions.
6. Institutional Brokers
What they do: Institutional brokers act as corporate finance specialists, helping later-stage startups secure funding from institutional investors, private equity firms and venture capital groups. These brokers provide structured investment solutions, facilitating large-scale funding rounds.
Typical investor profile: Institutional brokers work with institutional investors, corporate investment arms and large-scale capital providers looking for scalable, high-growth investment opportunities.
Where to find them: Institutional brokers operate through corporate finance firms, investment banks and private equity consultancies. Many focus on high-value transactions rather than seed or early-stage investments.
Fee structure: Institutional brokers charge transaction-based success fees, often a percentage of the deal value. Some may require retainers or due diligence fees upfront.
How ThatRound Helps Founders Navigate Fundraising Services
Raising capital is a defining hurdle for startups, and the diverse ecosystem of fundraising services ranging from angel networks to investor syndicates and institutional brokers can feel overwhelming. Founders often spend significant time identifying these services, understanding their offerings, and connecting with the right partners, all while trying to grow their businesses. ThatRound simplifies this journey by providing a smarter, more efficient way to explore and engage with fundraising services tailored to a startup’s specific needs.
A Centralised Marketplace for Fundraising Clarity
At ThatRound, we’ve created a centralised marketplace that brings clarity to the fragmented world of fundraising services. Our platform aggregates vetted options such as investor syndicates and institutional brokers, into one accessible hub. Founders can compare these services based on key factors like growth stage, sector relevance, and investor reach, using transparent metrics like past amounts raised, founder reviews, and comparative ratings. This eliminates the need for endless research and scattered outreach, helping startups quickly identify partners that align with their funding goals.
Streamlined Tools and Legal Framework
Beyond connecting founders with fundraising services, ThatRound streamlines the process with practical tools and a unified legal framework. Our service comparison tools allow side-by-side evaluations of fees (upfront costs, retainers, or success-based commissions), investor types, and sector expertise, empowering founders to make informed choices without guesswork. Meanwhile, our standardised legal agreements reduce the complexity of negotiations and contracts. By offering pre-vetted terms that ensure consistency across partners, we cut down on administrative burdens, enabling faster, smoother engagements with fundraising services.
Expanding Opportunities, Reducing Inefficiencies
ThatRound’s approach expands funding opportunities while reducing the inefficiencies that often plague the process. Instead of navigating a maze of options alone, founders gain access to a wider pool of services, each capable of connecting them to investors suited to their stage and vision. Whether it’s tapping into crowdfunding for early-stage capital or partnering with institutional brokers for larger rounds, ThatRound ensures startups can explore multiple pathways without the usual barriers of time and uncertainty.
Empowering Founders to Focus on Growth
Ultimately, ThatRound empowers founders to focus on what matters most: building their businesses. By simplifying how startups understand and leverage fundraising services, we turn a complex landscape into a structured, results-driven experience. Whether you’re raising your first round or scaling toward a major milestone, ThatRound is your partner in cutting through the noise, connecting with the right fundraising services, and securing the investment you need to succeed.
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