Fundraising? Here's What VCs Actually Look For in Your Model.

So you’ve nailed the pitch deck. The story is compelling, the vision is huge, and you've got the investor nodding along. Then comes the inevitable moment:

"This looks great. Can you send over the financial model?"

This is where deals are made or lost. It's the moment you move from selling a dream to proving you can build a business. A slick deck can get you the meeting, but a sloppy, illogical model will get you a polite "no."

So, as you build your fundraising model, what should you actually focus on? Forget the 50-tab monstrosity. Angels and VCs are testing for one thing above all else: the quality of your thinking.

Here’s what they’re really looking for.

1. The Story Behind the Numbers (Your Assumptions)

The brutal truth? No investor believes your Year 5 revenue projection. Not really. What they do believe in is a logical, defensible story of how you get there.

They will stress-test your assumptions relentlessly.

• Bad: "We'll capture 1% of a £5 billion market." (This is a top-down fantasy.)

• Good: "We'll hire 2 salespeople in Month 3. Based on a 3-month ramp time and a quota of £15k new MRR per month, that drives our sales-led growth. Our marketing-led growth comes from a £10k/month ad spend with a £250 CAC, adding another 40 customers per month." (This is a bottom-up, operational plan.)

Your model isn't a forecast; it's a machine. Investors want to see that you built the machine and you understand how all the gears connect.

2. The Engine of Your Business (Your Unit Economics)

If your business was a car, unit economics would be the engine. It proves the business model can actually work at scale. If you don't have these nailed, you’re dead in the water.

• LTV (Lifetime Value): How much is a customer worth over their entire relationship with you?

• CAC (Customer Acquisition Cost): How much does it cost you to acquire that customer?

• CAC Payback Period: How many months does it take to earn back the cost of acquiring a customer?

The golden rule is a healthy LTV to CAC ratio (ideally 3:1 or higher for SaaS) and a reasonable payback period (under 12 months is fantastic). Be prepared to defend how you calculate these numbers.

3. The Ask and The Use of Funds

Your model must clearly answer: "Why are you raising this specific amount of money?"

Connect your "ask" directly to a plan. Your model should show that raising £1.5M provides, for example, 18-24 months of runway. More importantly, it should detail what that money achieves.

• Example: "This £1.5M allows us to hire 4 engineers to build out Feature X, 2 account executives to expand into the enterprise market, and increase marketing spend to £30k/month. This plan gets us to £120k MRR, the key milestone for our Series A."

This shows you're a disciplined, capital-efficient operator, not just someone plucking a number out of thin air.

Anchor Your Story with the Right KPIs

Once the fundraising dust settles, you need to run your business. The best models are built around a handful of key performance indicators (KPIs) that act as your North Star. They cut through the noise and tell you if you're winning or losing.

Your KPIs will depend on your business model:

• For SaaS: Track MRR/ARR, Net Revenue Retention (NRR), and CAC Payback Period. NRR is crucial as it shows your ability to grow within your existing customer base.

• For a Marketplace: Focus on Gross Merchandise Value (GMV), your Take Rate, and the liquidity/health of the marketplace (e.g., % of listings that result in a transaction).

• For D2C/E-commerce: Live and die by your Contribution Margin, Average Order Value (AOV), and Repeat Purchase Rate.

Pick 3-5 KPIs that truly define success for your business. Build your model around them, report on them religiously, and use them to make every strategic decision.

If you're gearing up for a raise and want to walk into meetings with unshakeable confidence in your numbers, hit reply. Let's make sure your model tells the right story.