How to Raise Money Without Selling a Piece of Your Business

For UK founders and finance leaders who want growth capital without dilution
You can compare angel investment with non‑dilutive funding and choose the route that fits your plan and preserves control. This guide explains how angels work and sets out SPRK’s equity-free options, so you can fund growth and keep your cap table clean.

How can I raise capital and keep 100% ownership?

Use non‑dilutive funding. Finance qualifying development with an R&D tax credit advance, bridge awarded grant cash with a grant advance, or deploy proven solutions with innovation term loans with fixed repayments so you can move at pace. Choose the path that fits your stage and cash flow plan.

What does “non-dilutive” cover?

Non‑dilutive funding lets you raise money without issuing shares. You keep ownership and repay from future cash flows or from confirmed sources such as HMRC R&D credits or grant drawdowns. At SPRK, most situations fit one of three routes: R&D tax credit advances, grant advances, and innovation term loans.

How does angel investment work and what do you trade?

Angel investors provide capital in exchange for a minority stake. Many bring experience and mentoring. The trade‑off is dilution and another voice at the table. You prepare a pitch, then negotiate valuation and due diligence, and you live with the terms you agree. Angels can be a strong fit when you want sector guidance or when you can use their network to unlock key customers. They are less attractive if control and ownership matter more to you than advisory support.

Angels often ask for a short monthly update and a quarterly review pack.

Dilution changes control: you add a voice to key decisions and share more of the future upside.

Decision frame: If you want capital plus mentoring and you accept dilution, evaluate angels. If you want capital without dilution and a predictable repayment profile, evaluate non‑dilutive routes.

Your grant letter lands on Monday; your vendor deposit is due Friday. A grant advance covers the gap so delivery starts on time and your equity plan stays intact.

Which non‑dilutive funding option fits my plan?

When should I use an R&D tax credit advance?

Use this for in‑house development or qualifying automation/AI work. You unlock a portion of your expected HMRC R&D credit so your team can keep shipping while the claim completes. Align drawdowns to sprint plans and documentation. Keep an engineering log (tickets, commits, time). It speeds claim prep and underwriting.

Illustrative example: A team saves £1,050 per month in productivity while repayments are £700 per month. Net +£350 per month. Illustrative only. Your figures will vary by project, savings and terms.

Learn more: Fuel Your Scale‑up Strategy with R&D Advance Funding.

When should I use a grant advance?

Use this when you have an Innovate UK grant or a similar award and milestone timing creates cash gaps. A grant advance brings forward part of the award so you can fund deposits and hit deliverables on time. Keep evidence tight and maintain your reporting cadence. Attach the award letter ID and the milestone schedule to your request. Vendors respond faster when deposits are funded.

Illustrative example: A project has a £150k award with 40% due to suppliers before the first drawdown. An advance covers deposits so the schedule holds. Example figures. Your numbers will depend on the programme and terms.

Learn more: Why Grant Advance Funding is Important for Early‑Stage Innovations.

When should I use an innovation term loan?

Use this when you want fixed instalments and quick deployment for cloud migrations, cybersecurity, or SaaS tooling. Set the term to your expected savings and adoption. This route works well if grants don’t fit and R&D scope is limited. Baseline unit cost today and again at month three. Show the delta in your board pack.

Illustrative example: A company expects £1,400 per month in hosting and admin savings and repays £1,000 per month. Net +£400 per month; coverage 1.4×. Illustrative example. Actual savings and terms will differ.

Learn more: Innovation Term Loans.

Angel or non‑dilutive: which fits my situation?

Start with the outcome you want: guidance or control.

You want your angel’s sector intros to land this quarter. You also have a grant milestone in six weeks. Blend the two: use a grant advance to hold delivery dates while you close the round. If you need sector mentoring or early customer introductions, angel investment can help. If you hold a grant award or you are preparing an R&D claim, non‑dilutive funding often delivers capital faster and keeps equity unchanged. If your savings cover repayments with room to spare, an innovation term loan keeps delivery simple.

Example: £800 in monthly repayments vs £1,180 in monthly savings gives 1.48× coverage. Boards care more about that ratio than the label on the funding.

For advanced questions, reach out to an SPRK consultant and we’ll talk it through.

What’s the step-by-step to secure non-dilutive capital?

1. Check what’s eligible and when cash arrives. Gather your grant letter (if relevant), your R&D status, and a delivery plan with dates.
2. Select the route. Use the cues above to choose an R&D advance, a grant advance, or a term loan.
3. Stress-test cash flow and coverage. Compare projected savings or receipts to repayments. Aim for net‑positive within a quarter, if your forecast supports it.
4. Package your evidence and apply. Line up a project plan, supplier quotes, and a 13‑week cash flow view. That helps underwriting progress quickly. Include statements of work (SOWs) and your grant letter ID if applicable.

Capture three numbers for your board: breakeven month, repayment coverage (savings/repayments), and runway change.

Why pick SPRK for equity-free capital?

British Business Investments has committed £20m to SPRK. That backing helps us support founders and finance teams through delivery. Read the announcement and learn how we are working with BBI.

Raise without selling equity: what to do now

If you want capital without selling a piece of your business, start with non‑dilutive funding and map the route that fits your plan. If you already have milestones and budgets, contact us and we’ll match your plan to an R&D advance, a grant advance, or an innovation term loan.

Want a second pair of eyes on your plan? Share your three numbers, breakeven month, coverage ratio, runway change, and we’ll connect you with experienced consultant.

This article is for general information only and does not constitute financial, legal or tax advice.

FAQs

How much equity do angels usually take?
It varies by deal and stage; angels typically take a minority stake in exchange for capital and support.

What is non‑dilutive funding?
It raises capital without issuing shares. You repay from cash flow or from confirmed sources such as R&D credits or grants.

Will a term loan affect a future equity round?
A sensible facility can extend runway and support growth metrics. Investors focus on traction and debt coverage rather than the presence of a well‑structured loan.

How fast can I access non‑dilutive funding?
Timelines vary by route and documentation; good prep shortens the path to drawdown.

Can I combine angels with non‑dilutive funding?
Yes, many teams blend routes. You can use non‑dilutive capital to de‑risk delivery while you finalise an equity round.

Is grant advance only for Innovate UK awards?
Innovate UK is a common use case, and the approach can work with other awarded programmes that use milestone drawdowns.

Does an R&D advance reduce my HMRC claim?
No. The advance bridges timing. Keep records tight and align with your adviser’s claim process.