How to Verify a UK Company Before Investing

Angel investors and syndicates need to verify UK startups quickly before committing capital. This guide explains how to check company legitimacy and identify red flags using Companies House filings and public data.

Step 1: Verify Companies House Registration

Every UK company must be registered with Companies House.

Check Active Status

Search the free Companies House register:

• Confirm the company is "Active", not "Dissolved" or "In Administration"
• Verify incorporation date matches what founders claim
• Check registered office address is real, not just a virtual office service
• Review company type (Ltd, PLC, LLP) aligns with investment structure

Red flag: Companies dissolved within 2 years or multiple dissolved companies linked to same directors.

Review Filing History

Check governance and compliance:

• Annual accounts filed on time (due 9 months after year-end)
• Confirmation statements submitted annually
• No outstanding penalties or late filing markers
• Consistent filing pattern over company lifetime

Red flag: Missing or late filings indicate poor financial management or cash flow problems.

Verify Director Details

Check all listed directors:

• Names match LinkedIn profiles and pitch deck
• No disqualified directors (search GOV.UK register)
• Relevant sector experience for founding team
• Check other companies where directors are or were appointed

Red flag: Directors with history of dissolved companies, disqualifications, or no verifiable professional background.

Step 2: Check PSC Register

The Persons with Significant Control register shows ownership structure.

Review Ownership

Check who controls the company:

• Identify individuals with more than 25% shares or voting rights
• Verify PSC names match founder claims
• Check for offshore entities or complex nominee structures
• Confirm founders hold significant equity stakes

Red flag: Hidden ownership, nominee PSCs, or founders with minimal equity.

Verify Share Structure

Look for unusual patterns:

• Excessive share classes that dilute founder control
• Recent share transfers before fundraising
• Nominee shareholders registered to addresses outside UK
• Corporate PSCs with opaque ownership chains

Red flag: Complex structures that obscure actual control or recent suspicious transfers.

Step 3: Review Financial Filings

Check available accounts for financial health signals.

Analyse Latest Accounts

If accounts are filed (not all startups file full accounts):

• Review turnover growth or decline year-over-year
• Check profit/loss and cash position
• Look at director remuneration levels
• Assess debts and liabilities

Red flag: Declining revenue, mounting losses without funding, or excessive director pay in loss-making startups.

Check Funding and Solvency

Look for financial stability indicators:

• Cross-reference Crunchbase for recent funding rounds
• Check for charges or mortgages on Companies House (indicates secured debt)
• Look at current assets vs. current liabilities ratio
• Review auditor reports for any qualifications (if audited)

Red flag: High debt, charges from lenders, or qualified audit opinions.

Step 4: Cross-Reference Digital Signals

Verify founder claims against public sources.

LinkedIn Verification

Check founding team profiles:

• Verify employment history matches pitch deck claims
• Confirm education and qualifications
• Check professional network and endorsements
• Look for connections to reputable investors or advisors

Red flag: LinkedIn profiles created recently, minimal connections, or employment gaps.

Market and Traction Signals

Look for evidence of genuine business activity:

• Company website showing real product or service
• LinkedIn shows team growth and active hiring
• Search "[company name] UK" for news or press coverage
• Check Glassdoor for employee reviews (if scale permits)

Red flag: No web presence, no team growth, or negative employee reviews about unpaid wages.

Pre-Investment Verification Checklist

Before committing to due diligence:

1. ✅ Companies House: Active status, on-time filings, no dissolved companies linked to directors
2. ✅ PSC register: Clear ownership, founders hold equity, no nominee structures
3. ✅ Directors: No disqualifications, relevant experience, clean company history
4. ✅ Accounts: Filed on time, reasonable burn rate, disclosed funding
5. ✅ Digital signals: Professional website, LinkedIn validation, market activity

When to Walk Away

Decline deals showing these red flags:

• Dissolved companies in director history
• Late or missing Companies House filings
• Complex PSC structures hiding ownership
• Directors with no verifiable background
• Discrepancies between pitch deck and official records

Free Verification Tools for UK Investors

Essential resources:

• Companies House: Free search for company data, filings, and directors
• GOV.UK: Disqualified directors register
• LinkedIn: Verify founder backgrounds and team growth
• Crunchbase: Cross-reference funding claims
• Google: Search for news, press, and regulatory issues

Manual verification takes 5-10 minutes per company but ensures you avoid obvious risks before detailed due diligence.

Summary

Early-stage investors can check UK company legitimacy by verifying:

• Companies House registration and filing compliance
• PSC register for ownership transparency
• Director backgrounds and company history
• Financial filings and solvency indicators
• Digital signals confirming business activity

These checks help angels and syndicates identify red flags before committing time to full investment due diligence.

Ventur compiles Companies House filings, PSC data, and director history into evidence-linked reports. Request a free verification report.

Questions? Email hello@venturhq.co.uk