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A Pre-seed Angel investment agreement captures the terms when an angel investor provides early funding to a startup, typically before the company has secured institutional investment. It's the legal foundation for injecting initial capital - usually between £10,000 and £50,000 - in exchange for equity shares in the business.

Under English law, these agreements set out key protections for both parties, including share class rights, anti-dilution provisions, and investor consent requirements. They're simpler than later-stage investment documents but still need to comply with UK Companies Act requirements around share allotments and shareholder rights. Most angel investors use them alongside SEIS/EIS tax relief schemes.

Use a Pre-seed Angel investment agreement when your startup needs initial funding but isn't ready for venture capital investment. This agreement works best for raising between £10,000 and £50,000 from individual investors, particularly when you're still developing your product or testing market fit.

It's essential to put this agreement in place before accepting any money from angel investors, especially if you plan to use SEIS/EIS tax benefits. The timing matters - having clear terms from the start prevents disputes about ownership, voting rights, and future funding rounds. Many founders use it alongside their first formal business plan and financial projections.

• Basic Single Investor Agreement: Most straightforward version, covering one angel investor with standard equity terms and voting rights
• Multiple Angel Agreement: Structured for several investors investing simultaneously, with provisions for lead investor rights
• SEIS/EIS Compliant Version: Specifically drafted to meet UK tax relief scheme requirements, including necessary compliance clauses
• Convertible Note Style: Uses debt that converts to equity, popular with angels who want flexibility on valuation
• ASA (Advanced Subscription Agreement): Simplified version that defers valuation until the next funding round

• Angel Investors: High-net-worth individuals providing early-stage capital, often experienced entrepreneurs themselves seeking SEIS/EIS tax benefits
• Startup Founders: Early-stage company directors seeking initial funding, typically pre-revenue or during product development
• Corporate Lawyers: Draft and review agreements, ensure compliance with UK company law and investment regulations
• Company Secretaries: Handle documentation, share certificates, and Companies House filings
• Accountants: Advise on tax implications, particularly SEIS/EIS qualification and share valuations

• Company Details: Gather full legal name, registration number, registered office, and current shareholding structure
• Investment Terms: Confirm investment amount, share price, number of shares, and type of shares being issued
• Investor Information: Collect investor's full details, tax status, and SEIS/EIS eligibility confirmation
• Business Valuation: Document pre-money valuation and calculation method
• Board Rights: Define any investor voting rights, board observer rights, or veto powers
• Future Rounds: Outline anti-dilution provisions and pre-emption rights for future fundraising

• Parties & Definitions: Full legal names of company, investors, and key terms defined
• Investment Details: Precise amount, share class, price per share, and completion mechanics
• Warranties: Company and founder representations about business condition and ownership
• Investor Rights: Information rights, board participation, and pre-emption rights on future rounds
• Transfer Restrictions: Drag-along, tag-along rights, and share transfer limitations
• SEIS/EIS Provisions: Qualifying conditions and compliance commitments
• Governing Law: English law jurisdiction and dispute resolution procedures

A Pre-seed Angel investment agreement differs significantly from a Seed investment agreement in several key aspects, though both handle early-stage funding. The main distinctions lie in the investment size, complexity, and investor expectations.

• Investment Size: Pre-seed typically involves £10,000-£50,000 from individual angels, while seed rounds usually range from £150,000-£2 million from institutional investors
• Documentation Complexity: Pre-seed agreements are simpler, focusing on basic shareholder rights and SEIS/EIS compliance. Seed agreements include more detailed investor protections and governance provisions
• Investor Requirements: Angel investors often accept lighter reporting obligations and fewer control rights than seed-stage institutional investors
• Valuation Approach: Pre-seed often uses rough estimates or caps, while seed rounds require detailed financial projections and formal valuations