A seemingly simple question: how should I structure my round?
The answer is nuanced - hence this article. Largely, it's unknown (and unknowable!) how your funding round will play out. You could meet someone within a week of starting your journey who takes the whole round - great! Or friends and family might commit £50k while arm's-length investors hold back, in which case it may be best to close the £50k first and raise the rest later.
Thankfully, FounderCatalyst gives you four ways to bring investors in, and you can combine them as your company grows. This article explains each one, the documents involved, what it costs, and how they fit together.
The four options at a glance
| Agile round with a Subscription Agreement | ASA | Priced round | Agile round with an Adherence Agreement | |
|---|---|---|---|---|
| In one line | Issue new shares to investors one at a time, before you have any investment paperwork | Investors pay now and receive shares later | A full funding round: everyone invests (usually at the same price) and signs together | Issue new shares to investors one at a time, under your existing investment paperwork |
| When do investors get shares? | As soon as each investor has signed and paid | When the ASA converts, usually at your next priced round, or at its longstop date (six months or less for SEIS/EIS) | When the round completes | As soon as each investor has signed and paid |
| When is the price set? | Now, at or above the minimum price you authorise | Later, at conversion, potentially with a discount and/or valuation cap | Now, from your pre-money valuation | Now, at or above the minimum price you authorise |
| Existing paperwork needed? | No, it's designed for companies without any | No | No, the round creates it | Yes: a shareholders' agreement, SSA or investment agreement |
| What the investor signs | Subscription Agreement | Advance Subscription Agreement | Subscription and Shareholders' Agreement (SSA) | Adherence Agreement |
| Do investors wait for each other? | No | No | Yes, the round completes together | No |
How Agile rounds work
An Agile round lets you issue new shares to investors one at a time. Each investor signs and pays on their own timetable and receives their shares straight away, without waiting for anyone else.
Every Agile round needs authority first. Usually this is an Agile authorisation: your shareholders approve, once, a maximum number of new shares, a minimum price per share (your pre-money valuation divided by your fully diluted number of shares) and a deadline of up to a year. Alternatively, the authority can come from Agile shares you set aside in a previous priced round.
For each investor, FounderCatalyst typically produces an NDA, an investor consent statement, a term sheet, board minutes and their investment agreement. Which investment agreement they sign depends on whether you already have investment paperwork.
Agile round with a Subscription Agreement (SA)
For companies with no investment paperwork yet. When you define your Agile authorisation, choose "We do not have any paperwork in place yet" under Existing paperwork. This option appears if you haven't completed a full funding round on FounderCatalyst.
New investors sign a Subscription Agreement: a short, standalone agreement to subscribe for shares. It covers the share issue, how the funds will be used, SEIS/EIS assurances where relevant, and basic company warranties. With no existing investor rights to protect, the authorisation only needs a shareholder resolution, and investor consents don't apply.
Bear in mind: a Subscription Agreement doesn't create a shareholders' agreement. These investors won't have the protections an SSA gives until one is put in place, usually at your first priced round.
Best for: early angels who want shares now at a set price, before you're ready for a full round.
Read more: Agile funding rounds.
Advance Subscription Agreement (ASA)
With an ASA, investors pay now and receive shares later, typically at your next priced round. A discount and/or valuation cap rewards them for investing early. If no qualifying round happens, the ASA converts at its longstop date.
Best for: raising quickly before you're ready to agree a valuation, or bridging to a priced round.
How it works: first you create an ASA approval: board minutes, a shareholder resolution and, where your paperwork requires them, investor consents. It sets how much you can raise over the next 12 months. You then issue individual ASAs within it. Each investor signs an NDA, an investor disclaimer and their ASA, which the company also signs.
On conversion: at a priced round, ASA investors join the round and sign its documents. If an ASA converts on its own and you already have investment paperwork, the investor signs an Adherence Agreement to join it. If you don't, they simply receive a share certificate.
SEIS/EIS: if your ASA investors want SEIS/EIS relief, keep the longstop to six months or less. FounderCatalyst warns you if you set a longer one.
Read more: Advance Subscription Agreements and the ASA calculator.
Priced round
A priced round (on FounderCatalyst, a full funding round) is the traditional way to raise. You agree a pre-money valuation, every investor buys shares at the same price, and everyone signs one set of documents before the round completes.
Best for: your first proper round, a lead investor or larger raise, and setting your company's long-term terms.
Documents: your first round creates the full set: term sheet, NDA, Subscription and Shareholders' Agreement (SSA), new Articles of Association, disclosure letter, board minutes and shareholder resolutions, IP assignments and founder service agreements. Later rounds can either keep existing terms, where new investors sign a Subscription and Adherence Agreement, or define new terms, where everyone signs a new SSA and you adopt new Articles.
Tip: when you set up a priced round you can set aside Agile shares. This lets you take in late or follow-on investors afterwards through an Agile round, without asking your shareholders again.
Read more: Guide to completing a funding round and FounderCatalyst documents.
Agile round with an Adherence Agreement (AA)
For companies that already have investment paperwork, whether from a FounderCatalyst round or elsewhere: an SSA, shareholders' agreement or investment agreement.
New investors sign an Adherence Agreement, which signs them up to your existing agreement on the same terms as your current investors. The authorisation is approved by a shareholder resolution, plus investor consents where your existing paperwork gives investors a say over new share issues.
Best for: follow-on money after a priced round, late investors, or topping up between rounds at the same or a higher price.
Read more: Agile funding rounds.
Using them together
You can only have one funding round or Agile authorisation open at a time, so you run them one after another. Some common paths:
1. No paperwork yet, investors ready now: Agile round with a Subscription Agreement, then a priced round.
Take in early angels at a fixed price, then run a priced round when a lead investor arrives. The priced round puts your SSA and Articles in place.
2. Not ready to agree a valuation: ASAs, then a priced round.
Raise with ASAs now and let the priced round set the price. ASA investors convert into the round at their discount or valuation cap.
3. The full journey: ASAs, then a priced round with Agile shares set aside, then Agile rounds with Adherence Agreements.
Bridge with ASAs, convert them at your priced round, then use the Agile shares you set aside to take in late investors.
4. For sophisticated investors: A priced round, then optionally a follow-on Agile round with an Adherence Agreement.
Lots of sophisticated investors (angel groups, funds, VCs, etc.) won't use an ASA or a Subscription Agreement. We explain why in another article. Start with a priced round, and if you need to take in more investors afterwards, an Agile round with an Adherence Agreement is a great choice.
5. Already raised elsewhere: Agile round with an Adherence Agreement.
If you have a shareholders' agreement or investment agreement from a raise outside FounderCatalyst, choose it as your existing paperwork, and new investors adhere to it.
What it costs
Our pricing is simple: a fixed fee, never a percentage of what you raise, and no hidden extras.
Pay as you go (one-off fees, excluding VAT):
| Product | Price | What's included |
|---|---|---|
| Priced round | £1,450 | One full funding round and all its documents |
| ASA approval | £1,450 | Approval to issue ASAs up to the amount you set, over 12 months |
| Agile round | £1,450 | If necessary, includes shareholder approval and then unlimited Subscription Agreements or Adherence Agreements |
Subscriptions (per year, excluding VAT) work out cheaper if you raise more than once a year:
| Plan | Price | Fundraising |
|---|---|---|
| Launchpad | £995 | Unlimited ASA, Agile and priced rounds, up to £100,000 of investment received a year |
| Core | £1,995 | Unlimited ASA, Agile and priced rounds, with no fundraising cap |
| Accelerate | £2,995 | Everything in Core, plus share options |
Fundraising subscriptions also include SEIS/EIS advance assurance, SEIS/EIS compliance and certificates, and unlimited expert support. See Pricing for the latest prices.
Which should I choose?
- Want to issue shares now, with minimal paperwork An Agile round with a Subscription Agreement.
- Not ready to set a valuation? An ASA.
- Have a lead investor, or need to set long-term terms? A priced round.
- Want to issue shares now, and already have a shareholders' agreement? An Agile round with an Adherence Agreement.
Still unsure? Raise a support ticket and we'll help you choose.
