> ## Content Index > Fetch the complete content index at: https://entrepreneurplus.co.uk/llms.txt > Use this file to discover other available public pages before exploring further. # Startup Valuation With No Revenue: How to Set a Price Investors Will Believe - URL: https://entrepreneurplus.co.uk/startup-valuation-with-no-revenue-how-to-set-a-price-investors-will-believe/ - Published: 2026-10-27T12:17:11.000Z - Updated: 2026-10-27T12:41:27.000Z - Description: The average UK seed valuation was £6.0m in 2025. The median was £3.2m. With no revenue, that gap is the first thing to understand before you name a price, so here is how to set one you can defend. - Author: Victoria Thomas - Tags: Startup Toolkit Startup valuation is what investors agree your company is worth when they buy in, and with no revenue to point at, it is the hardest number a founder sets. This guide covers how **pre-revenue startup valuation** works, what the latest UK seed data shows, and how SEIS and EIS shape the conversation. --- ## What Startup Valuation Means: Pre-Money vs Post-Money Post-money valuation equals pre-money valuation plus the new investment, so a £2m pre-money valuation with a £500k raise gives a £2.5m post-money valuation. Work backwards and pre-money is post-money minus the investment. The split matters because it sets dilution: in that example, the £500k buys 20% of the company. Every offer is quoted **pre-money or post-money**, so check which number an investor means. Option pools interact with both: see our [pre-money vs post-money option pool guide](https://entrepreneurplus.co.uk/share-option-pool-how-uk-startups-size-structure-it/). --- ## Why Pre-Revenue Valuation Works Differently Pre-revenue startup valuation relies on qualitative and comparison-based methods, because there is no revenue to apply a multiple to. Revenue multiples are hard to use credibly without sales, so scorecard and checklist-style approaches are common instead. UK advisers describe these **startup valuation methods** as focused on potential rather than financial performance, and recommend combining several rather than trusting one. For you, that means your valuation is an argued position, not a calculation. --- ## Startup Valuation Methods Investors Use The main startup valuation methods for early-stage companies are scorecard, Berkus, venture capital, cost-to-recreate and comparable transactions, and advisers recommend combining several. | Method | How it works | Watch out for | | ----------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------- | | Scorecard (Bill Payne) | Starts from the median valuation of comparable pre-revenue companies in your region and sector, then adjusts: team up to 30%, opportunity up to 25%, product up to 15%, competition up to 10% | Needs good local comparables | | Berkus | Adds up to $500,000 for each of five factors: idea, prototype, management team, strategic relationships, product rollout or sales | A 1990s US framework in dollars, not a UK benchmark | | Venture capital | Post-money valuation equals exit value divided by the return investors expect | Rests on an exit forecast | | Cost-to-recreate | Totals what it would cost to build the business again from scratch | Says little about future potential | | Comparable transactions | Compares you with what similar companies were valued at in funding rounds, ideally in your sector or region | Needs recent, like-for-like deals | Run at least two and see whether they land in the same range. If they don’t, that gap is the first thing an investor will probe. --- ## Seed Round Valuation UK: What the 2025 Data Shows The median UK seed-stage pre-money valuation hit a record £3.2m in 2025, with the average at a record £6.0m. The median fell 9% between the first and second halves of 2025\. Seed deal numbers dropped 27% to 704 while investment held at £2.1bn, so more money went into fewer companies. The **median seed deal** stayed at £0.6m, while the average deal rose 41% to £3.2m, helped by one £445m round for Fidra Energy (without it, the rise would have been 11%). Seed companies also waited longer between rounds: a median 14.4 months, up from 12.4 in 2024. Two cautions. The Bank’s “**seed**” label follows Beauhurst’s company-stage classification, not the type of funding round. And many early seed rounds close privately through angel networks, so they rarely appear in the data. Treat these figures as a market guide, not a price for your company. --- ## How SEIS and EIS Affect Your Round A company qualifies for SEIS if it has traded for no more than three years, has fewer than 25 full-time equivalent employees and holds gross assets of no more than £350,000 when shares are issued. It must also carry on a qualifying trade, be established in the UK and meet HMRC’s risk-to-capital test, and it can raise up to £250,000 through the scheme. Investors get 50% income tax relief on up to £200,000 a year (BDO). SEIS is unavailable after EIS or VCT investment, but **SEIS-funded companies** can raise from both later (BDO). The ceiling shapes your maths: at an illustrative £1m pre-money, £250,000 buys 20% of a £1.25m post-money company. ![UK startup SEIS investment and founder dilution chart](https://storage.ghost.io/c/05/a4/05a4a052-18ab-4836-8924-ec8b322c371c/content/images/2026/10/Modern-Financial-Analytics-Workspace.png) UK startup SEIS investment and founder dilution chart Larger rounds may look to EIS, whose company limits rose for shares issued from 6 April 2026: gross assets up to £30m before issue and £35m after, £10m a year (£20m for knowledge-intensive companies) and £24m over a lifetime (£40m). Specified companies face lower limits, so check HMRC’s rules first. --- ## ASAs vs Convertible Loan Notes: How Your Instrument Changes the Deal An **advance subscription agreement** (ASA) can qualify for SEIS or EIS relief if it meets HMRC’s conditions; a convertible loan note cannot, because it counts as debt. An ASA lets **investors pay now and receive shares later**, usually at a discount to the next round’s price. Because shares are priced on conversion, an ASA postpones your valuation rather than fixing it. HMRC will only treat one as suitable if the subscription cannot be refunded, varied, cancelled or assigned, carries no interest, and has a longstop date expected to be no more than six months. Advance assurance is optional, but if you want it, apply before the ASA is signed. Miss these conditions and you put the relief at risk. --- ## Common Startup Valuation Mistakes Quoting the average seed valuation instead of the median overstates the typical founder’s position: the British Business Bank’s 2025 average of £6.0m is nearly double its £3.2m median. - **Mixing sources and periods:** Figures from different datasets and time periods are not comparable. Name the source and period every time. - **Treating Berkus’s dollars as UK benchmarks:** It is a US framework, so use it to structure your thinking, not to set a price. - **Leaning on one method:** Advisers recommend combining several (Standard Ledger). - **Calling a seed median a pre-seed benchmark:** The British Business Bank reports seed, venture and growth stages, not pre-seed, so no official UK pre-seed valuation figure exists in its data. --- ## How to Defend Your Valuation You defend a valuation by showing that several methods converge on the same range, and by tying every number to a named source and period. Pick comparable rounds in your sector and region, as Standard Ledger advises, and use the **British Business Bank** median as a reference point, not a target. Expect pushback on timing: the median seed pre-money fell 9% in the second half of 2025, and rounds are taking longer, so show a runway that survives a slower raise. And don’t trade terms for a headline number. HSBC Innovation Banking’s Venture Capital Term Sheet Guide 2026 found participating preference shares at seed doubled from 7% to 14%, even as they eased at later stages, so read the structure as closely as the price. A defensible valuation is one you can explain, with sources, in two minutes. --- ## FAQs ### 1\. How do you value a startup with no revenue? Pre-revenue startup valuation rests on qualitative or comparison-based methods such as scorecard, Berkus, comparable deals, the venture capital method and cost-to-recreate, because there is no revenue to apply a multiple to. Advisers recommend combining several rather than relying on one. ### 2\. What is the difference between pre-money and post-money valuation? Pre-money is a company’s value before new investment, and post-money is pre-money plus the investment. A £2m pre-money valuation with a £500k raise gives £2.5m post-money, so the new investor holds 20% (Sprintlaw). ### 3\. What is a typical seed round valuation UK founders should expect? The median seed-stage pre-money valuation was £3.2m in 2025, the average £6.0m, and the median seed deal £0.6m (British Business Bank Small Business Equity Tracker 2026). The median fell 9% between the first and second halves of 2025. --- *Sources: British Business Bank Small Business Equity Tracker 2026 (published 2 July 2026, using Beauhurst data); HMRC and gov.uk guidance on SEIS; Angel Capital Association; HSBC Innovation Banking Venture Capital Term Sheet Guide 2026; BDO; Saffery; Osborne Clarke; Ashfords; Vestd; Sprintlaw; Standard Ledger. Figures reflect the most recent available data at the time of writing.* ***The EP+ Editorial Desk covers UK startups, founder stories, and venture capital. All editorial content is independently produced and human-reviewed before publication.***