The US Raise: Rocket Fuel… and a Very Sharp Knife

In the UK start-up ecosystem, there’s a familiar funding arc.

You raise from angels, then from UK VCs, and if things go well enough, someone eventually says: “We’re getting interest from the US.”

For founders, it feels like validation. For early investors, it feels like acceleration. For the business, it can feel like the moment everything changes, and often it does, because US capital usually comes with two things the UK struggles to match: larger cheques and higher valuations. Sometimes materially higher.

That isn’t just optimism or American bravado. There’s a structural reason for it.

Why US money is so tempting

If your product works in the UK, the US market can easily be 10–15x larger.

A business that looks like a £20m opportunity here can plausibly be a £200m opportunity there — simply because budgets are bigger, customers are more numerous, and outcomes are expected to be larger by default.

So a US investor doesn’t always see a “UK start-up”. They see a US-scale business that happens to have started in Britain. When that framing lands, two things tend to follow quickly:

• valuations move up

• the amount of capital available increases sharply

  
  

From an investor’s perspective, that’s compelling. From a founder’s perspective, it can feel like a step into a different league.

I’ve seen it directly. I invested in Natter at around a £3m valuation. It’s now north of £60m and raising in the US. That kind of re-rating happens far more often once American capital enters the picture.

So far, it all sounds positive, but the trade-offs matter.

US VCs aren’t usually buying “growth” — they’re buying a shot at a unicorn

Much of US venture capital is built around a specific portfolio model:

• make many bets

• expect a high failure rate

• rely on a small number of extreme winners to return the fund

  
  

That’s not a criticism, it’s just how the maths works. It creates a disconnect with how many UK founders define success.

A UK founder might think: “If we build a solid business, get to profitability, and sell for £150m, that’s a fantastic outcome.”

A US fund investing at a £50m+ valuation might quietly think: “That outcome doesn’t move the needle.”

If they’re deploying £10m or £20m into a company, they’re not targeting a double or a triple. They’re underwriting the possibility of a multi-billion-dollar outcome. Anything short of that can become strategically uninteresting.

High valuation + hard expectations = a narrow path

This is where US money can turn from accelerant to constraint.

I recently spoke to a founder who had US capital on the table and chose not to take it. Instead, they raised in the UK at a lower valuation.

On the surface, that looks counter-intuitive, but their reasoning was simple. US money can create a dynamic where:

• the business is priced for a unicorn outcome

• strategy becomes “go big or go home”

• anything less than exceptional growth is treated as failure

  
  

When expansion is harder than expected, when burn becomes uncomfortable, or when growth inevitably smooths out, the options narrow quickly. At that point, portfolio logic often kicks in: “If it’s not going to be huge, we might as well swing harder.”

That can push companies toward:

• aggressive spend

• premature US expansion

• expensive senior hires

• plans that assume execution without friction

  
  

Sometimes it works brilliantly. Sometimes it doesn’t. And when it doesn’t, a second issue appears.

When a “successful” exit still leaves people with nothing

High-valuation rounds often come with strong investor protections — liquidation preferences, priority returns, and downside coverage. These are sensible structures when outcomes are genuinely large, but if the company exits below expectations, the consequences can be stark. You can end up with a business that:

• built a real product

• created jobs

• generated meaningful revenue

…and still delivers an exit where:

• later-stage VCs get paid

• founders and early shareholders receive little or nothing

  
  

That feels shocking the first time you see it. Then you realise it’s not personal — it’s structural.

From the fund’s perspective, it’s portfolio maths. A handful of 20x outcomes justify everything else. From the founder’s perspective, it’s years of work for an outcome that doesn’t match the effort. Both can be true at the same time.

So should you raise in the US?

US capital is a powerful tool if you genuinely want — and can credibly pursue — a unicorn trajectory. If you’re comfortable with:

• speed over control

• scale over optionality

• a definition of success that excludes “good” outcomes

  
  

Then it can turn a UK start-up into a global business very quickly. It isn’t just money. It’s a commitment to a particular path. Once you take US money, you’re usually opting into:

• a faster pace

• higher risk

• fewer acceptable endgames

  
  

That trade-off deserves to be made consciously.

The underrated alternative: a great business and a great outcome

There’s a version of success that doesn’t get enough airtime. A business that:

• grows steadily

• reaches profitability

• exits at a sensible valuation

• leaves founders and early shareholders meaningfully rewarded

  
  

UK funding can feel conservative by comparison. Valuations are lower. Cheques are smaller, but terms are often better aligned with building a durable business rather than forcing a moon-shot.

That’s not a lack of ambition. It’s a different definition of success.

The question that actually matters

Not: “Can I raise in the US?”. With enough traction, most founders eventually can.

The real question is: “Do I want the path that comes with it?”

US capital can make you very wealthy, or it can lock you into a race where the only acceptable finish line is a unicorn — and anything else leaves you tired, diluted, and potentially empty-handed.

Rocket fuel is powerful. Just be honest about what happens if it ignites!