Funding announcements are a regular part of Scottish business news, and they often prompt the same questions. What does a seed round involve? Who are the investors, and what do they receive in return? How is a company valued, and what happens to the founders’ stake?
A new explainer from our sister title Silicon Scotland sets out the answers in plain terms. It is written as an introductory guide for readers following investment news, and for founders and managers who want a clearer picture of how rounds are put together.
The guide walks through the stages of equity funding, from pre-seed and seed to Series A, B and C. It explains who invests at each stage, from angel investors and venture capital firms to corporate investors and public funders such as Scottish Enterprise and the British Business Bank. It also covers the SEIS and EIS tax relief schemes and what they offer investors, and explains term sheets, valuation and dilution, with a worked example of how a founder’s shareholding changes when new shares are issued.
Recent rounds by SolarSub, StandardX and MAGIC AI illustrate the process, and the guide closes with the latest picture for Scotland. According to the British Business Bank’s Small Business Equity Tracker 2026, smaller businesses in Scotland raised £986 million across 197 announced deals in 2025. Investment value rose by 74%, and Scotland’s share of UK equity investment doubled from 4% to 8%.
In Case You Missed It:
Round One opens 2026 applications for Scottish pre-seed founders
ECI Partners lifts the lid on what CEOs often get wrong about private equity
Specialist capital is wiring into Scotland’s deep‑tech scaleups
Scottish company failures down 28% in a year, but household insolvencies are moving the other way
You can read the full guide on Silicon Scotland now: How Funding Works
