Britain’s brilliant consumer startups are finding themselves stranded in a funding no man’s land – too mature for angel investors, too small for venture capitalists, writes Joe Benn in today’s Notebook

Why Britain’s consumer startups are falling into a funding trap

The UK is brimming with ambitious founders reshaping tired categories across fast-moving consumer goods (FMCGs). In recent months, brands like Deliciously Ella, Biotiful and Wild have shown how compelling storytelling, bold branding and a mission-driven ethos can disrupt the status quo – and attract major acquisitions. But for every headline-grabbing success, there are dozens of startups falling into a funding gap.

Early-stage investment can be straight-forward enough, with enterprise investment schemes (SEISs and EISs) providing great tools to attract angels and crowdfunding.

I’m not saying it feels easy out there if you’re a first-time entrepreneur, but realistically if you have a strong proposition and the right approach, you should be able to raise those all-important early funds.

This early-stage ecosystem is both a blessing and a curse. It breeds innovation, but also fierce competition and inflated valuations. These early valuations create a psychological trap. Founders believe they’re worth millions on........

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