Standard Preferred Equity Terms for UK Deals

searcher profile

June 05, 2025

by a searcher in London, UK

Hoping to close a self funded deal and am looking to possibly raise £150k of preferred equity (the rest of the funding is a combination of personal equity and bank debt). Looking for any feedback on typical pref. terms people have seen in the UK market. Also interested in speaking to anybody interested in investing in the pref.
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Reply by a searcher
from University of Bristol in London, UK
Im unaware of specific terms. Normally there is a waterfall with preferred paid back their capital first in advance of other equity types on both and exit or liquidation. In VC world sometimes the VCs ask for a 2x pref return.
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Reply by a searcher
from University of Oxford in London, UK
Hard to say what a 'typical' pref looks like. It would rank above the Ords, and would typically come with some kind of liquidation preference / preferential returns. I have seen liquidation preference anywhere between 1x to 3x. How much you give away depends on how badly you need the funding. Happy to have a chat.
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