Agile vs priced rounds: Choosing the right fundraising structure

Raising investment isn’t just about the ticket price of your round - it’s also about how you raise. The structure of your fundraise will influence dilution, valuation cadence, governance, investor perception, and the long-term health of your cap table. 

For business owners, the choice often comes down to agile rounds versus priced rounds. Both are widely used and legitimate options for fundraising; their difference lies in what they are optimised for.

Let’s take a look at how each structure works in practice, where the nuance and complexity really sit, and how to make a deliberate choice that supports the needs of your business - not just for this raise, but for the ones that follow.

What is an agile round?

An agile round is a flexible fundraising approach that allows you to raise capital incrementally, rather than waiting until all investors are lined up before accessing funds. Instead of single hard close, investments are accepted on a rolling close basis.

In practical terms, this means founders can open an investment round, and continue to accept new investors under the same terms for a defined period of time - usually around six months.

This means you’ll have access to the capital as it rolls in, and can also continue to fundraise in parallel. 

In the UK, rounds are usually implemented through unpriced instruments such as Advance Subscription Agreements (ASAs), and Convertible Loan Notes (CLNs), where capital is provided upfront, but share issuance is deferred.

These also defer the question of, or necessity for, a valuation until a later priced round, due to the delay with share issuance.

How do agile rounds work in practice?

Ensuring the consistent flexibility of an agile round depends on upfront authorisation and having the correct foundations to support the flexible fundraising structure.

Before launching, founders must authorise the creation of additional shares and secure the relevant shareholder consents. Existing investors may waive their pre-emption rights and approve follow‑on investments under the same terms.

Once this framework is in place, each singular investment can close independently of one another - you don’t need to turn to the shareholders for approval every time a new investor comes in, and the round remains open until the agreed window expires.

Operationally, this is what makes agile rounds attractive: fundraising becomes something you do alongside running and growing your business, rather than a time consuming one-off event.

What is a priced round?

A priced round is the traditional fundraising model most founders will be familiar with. A fixed amount of capital is raised at an agreed valuation, resulting in a clear price per share and immediate share issuance. 

Investors are identified upfront, terms are negotiated collectively, and the round completes once all investors have committed. Later institutional raises usually follow this structure, due to the more complex requirements of larger-ticket investors.

Priced rounds require a fuller legal framework, usually including a term sheet, subscription agreement, shareholders’ agreement, and (potentially) updated articles of association, dependent on the terms negotiated.

How do priced rounds work?

Priced rounds are carefully structured and sequential. Valuation and terms are confirmed first, followed by the required legal documentation your round structure necessitates. This documentation may be light-touch, or very complex, depending on the size of your round and nature of investors.

Once all investors have signed their documentation and approved the terms, the money is received, and shares are issued simultaneously. 

The main benefit of this structure is clarity. Ownership percentages, governance rights, and economic outcomes are defined from day one. The cost is time, focus, and upfront legal spend.

For founders, a priced round is less something that happens around your business, but more a stage of business growth your company will enter into, and is likely to take up a lot of a founder’s time. 

Why founders choose priced rounds

As mentioned briefly, priced rounds are preferred when certainty is prioritised over speed. 

A clear valuation sends a strong signal to the market and future investors, which can be especially powerful for businesses with strong growth metrics or clear competitive positioning. 

Priced rounds also bring clarity to governance; shares are issued straight away, meaning everyone knows exactly where they stand. This can simplify cap table management, make employee equity planning more straightforward, and reduce ambiguity ahead of future raises.

For some founders, this clarity is worth the additional time and cost.

From an investor perspective, priced rounds are familiar and reassuring. The process is well understood, governance rights are defined upfront, and there is less reliance on future conversion mechanics.

The trade-off is pressure. Priced rounds require coordination, concentration, and momentum. They tend to incur higher legal costs, and take longer to execute.

But for the right business, this discipline can be a strong stabilising mechanism that keeps your growth trajectory clear and aligned.

The real difference: speed versus clarity

At their core, agile and priced rounds both solve different problems.

Agile rounds are about adapting in real-time, taking money opportunistically, extending momentum, and avoiding pauses in growth. Priced rounds are about locking things down - agreeing value, ownership, and control with precision.

Choosing between them isn’t about which is better overall, rather it’s about whether your business is at a stage where certainty adds more value than flexibility. 

Valuation mechanics in agile rounds

Although agile rounds avoid setting a valuation upfront, there are certain valuation mechanics that are utilised when going down this route. 

Most instruments include economic protections for early investors, including caps, floors, or discounts. 

Caps set a maximum valuation at which an investment will convert into equity. Valuation floors set a minimum share price to ensure new shares won’t be sold at a lower price to that paid by early investors.

Discounts allow early investors to convert their shares at a lower price than that paid by new investors.

For founders, these mechanics directly affect dilution. The impact is often underestimated until conversion, so that’s why careful round modelling and investment limits are crucial for staying in the green when using agile instruments.

Governance and investor expectations

Agile rounds tend to introduce governance more lightly at first. Voting rights and more complex terms are usually deferred until conversion, with investors receiving more mainstream rights and basic protections in the meantime. 

Priced rounds formalise governance immediately. Board representation, investor consent, and shareholder protections are agreed upfront, which introduces structure and accountability earlier in the company’s investment journey.

Neither approach avoids governance - agile rounds just defer more complex negotiations to a future stage.

SEIS and EIS considerations

For UK founders, SEIS and EIS adds another layer of nuance when choosing between agile and priced rounds, particularly with regard to the instruments used within agile rounds. 

When running an agile round, the key distinction is between ASAs and CLNs. CLNs are debt instruments, and despite having the option to be paid back in shares, still constitute a loan, meaning they are not compatible with SEIS or EIS, which require investors to subscribe for qualifying shares rather than lend capital.

ASAs, by contrast, are not loans and do not accrue interest. They represent an advance subscription for shares and therefore are actually compatible with SEIS and EIS - but only if structured correctly.

In particular, HMRC places importance on the longstop date, which sets the latest point at which the ASA must convert into shares.

HMRC states that this is likely to be no longer than six months from the date the ASA is entered into. Longer periods increase the risk that the company’s circumstances have changed, making advance assurance unlikely.

Agile rounds can work well with SEIS and EIS compatibility, but only when the right instruments are used and conversion timelines are controlled. Poor structuring can accidentally disqualify investors from relief and create avoidable friction later on.]

Choosing deliberately

Agile rounds often make sense for founder-led businesses with momentum, early-stage traction, or those looking for bridge-funding between priced rounds. 

Priced rounds are often better suited to businesses with meaningful revenue, growing teams, and a need to formalise governance ahead of receiving capital.

InVestd Raise

With InVestd Raise, you have the tools you need to prepare and execute a funding round, without the hassle. 

From streamlined S/EIS advance assurance applications and pitch deck templates to secure data rooms and digital cap table management, everything you need is in one place. 

Let’s make your raise easier - book a call today to upgrade, and streamline your fundraise - whatever the structure.