| A | |
| Accelerator | Startup accelerators support early-stage, growth-driven companies through education, mentorship, and financing. Accelerators typically offer structured programs for a defined period of time. |
| Accredited Investor | An individual or company that is able to purchase and trade securities which are not regulated by the SEC. |
| Angel Investor | An angel investor is usually a high-net-worth individual who funds startups at the early stages, often with their own money. |
| Anti-dilution Rights | Anti-dilution rights protect early investors in the event of a future decrease in the value of their shares. These rights issue additional shares to investors who invested at a higher valuation. |
| B | |
| B Corp | A certified B Corporation is a for-profit company that has third-party certification to verify that it voluntarily meets defined standards relating to the environment, social impact, accountability and transparency. |
| Bootstrapping | A company started with no outside investments. |
| Burn Rate | The burn rate is a measure of negative cash flow. It is the rate at which a startup is spending its venture capital to finance overhead before generating positive cash flow. |
| C | |
| Capacity Building | Strategies designed to make businesses more adaptive in an ever-changing market. |
| Convertible Note | A convertible note is short-term debt that converts into equity and is used by investors to fund early-stage startups. |
| Churn Rate | The annual rate at which customers stop subscribing to a service |
| D | |
| Debt Financing | To raise money by selling bond, bills, or notes to an investor with the promise that the debt will be repaid with interest. |
| Disruptive Innovation | A new product or service that has the potential to replace, or displace, a conventional product or service. |
| Down Round | Often the result of a lowered valuation, a down round refers to a startup offering additional shares for sale at a lower price than in the previous financing round. |
| Dragon | A startup that raises $1 Billion+ in a single funding round |
| E | |
| Ecosystem | A startup ecosystem is a group of people, companies, and related organizations that work as a system to create and scale new startups. Ecosystems form in limited geographic areas. The group draws together key actors and stakeholders that gravitate towards growth ventures, including entrepreneurs, mentors, incubators, sources of talent such as universities and corporations, investors and supporting services like startup-savvy law and accounting agencies. |
| Equity Financing | Raising capital by selling off shares of a company |
| Exit Strategy | The plan created by an investor, trader, venture capitalist, or business owner to end a partnership once a predetermined financial criterion has been met or exceeded. |
| F | |
| First Mover Advantage (FMA) | The competitive advantage gained by being first to market in a new product category |
| Flat Round | A round of financing that is closed at the same valuation as the prior round of financing. |
| Funding Round | The stages of startup fund raising. Typically, the funding rounds are: Pre-Seed, Seed, Series A, Series B and Series C |
| G | |
| H | |
| Hockey Stick Curve | Hockey Stick growth refers to rapid revenue growth of a startup after a long period of linear growth. |
| I | |
| Impact Investing | Investments made with the intention to generate measurable social and environmental outcomes, in addition to a financial return. |
| Incubator | A startup incubator is a collaborative program to help entrepreneurs by providing workspace, seed funding, mentoring, and training with the goal of growing the businesses. Startup incubators are usually nonprofit organizations, often associated with universities and business schools. |
| Investor Swarming | |
| J | |
| K | |
| L | |
| Lean | The development of a product or company based on the expressed desires of the market |
| Love Money | Money an entrepreneur receives from family and friends to launch business |
| M | |
| Mezzanine Financing | Frequently associated with acquisitions and buyouts, this financing is a hybrid of debt and equity financing that gives the lender the right to convert to an equity interest in the company in case of default |
| Micro Venture Capital | Small venture firms that invest in seed stage companies, and typically invest between $25K to $500K in a given company. |
| Minimum Viable Product | Minimum Viable Product or MVP is a new product that is introduced in the market in a basic format, with the goal of getting consumer feedback to develop the final product. |
| N | |
| O | |
| OPM (Other People’s Money) | Capital from friends, family and early investors |
| P | |
| Preferred Stock | Preferred stock rights help to minimize investor’s exposure to risk in future funding rounds. Sometime called Preferred Equity, these holdings allow investors to be first in line for payment in the case of a solvency event. |
| Pre-Seed Funding Round | Early round of funding for initial startups. Often funds are raised from family, friends, the founder’s own resources, and occasionally, angel investors. |
| Private Equity | A source of investment capital from high-net-worth individuals and firms. |
| Proof of Concept (POC) | A demonstration of the viability of a company or potential product. |
| Pro-rata Rights | The opportunity given to a startup investor that allows them to maintain their initial level of ownership percentage during later financing rounds |
| Q | |
| R | |
| Ramen Profitable | A profit margin that can cover basic operating expenses and staff salaries. |
| Runway | How many months a startup business can operate before it runs out of money. |
| S | |
| Scalability | A company’s ability to grow based on their value proposition, repeatable business model, high growth, high margin, and distribution potential. |
| Seed Funding Round | Often the first round of outside funding for new startups. Funders are typically angel investors, targeted funds, accelerators, incubators, and venture capitalists. These funds typically finance research, key hires, product development and other initial startup activities. |
| Series A Funding Round | At this stage, funding is often provided by a venture capitalist or angel investor and is based on real data from the operation of the startup. |
| Series B Funding Round | Startups at this stage of the funding process are often seeking capital expand operations |
| Series C Funding Round | Startups that reach this stage in the funding process are typically valued at 100 million dollars or more |
| T | |
| U | |
| Unicorn | A privately held start up with a value of more than 1 billion dollars |
| | |
| V | |
| Valuation | Valuation is the amount that a startup is worth. This number is based on the amount that founders, investors, and shareholders decide that the company is worth, which is determined by the price per share that investors are willing to pay in order to invest in a startup during a particular round or stage.To calculate the value of an individual investor’s shares in a startup, multiply the number of shares the investor owns and the company’s current price per share. |
| Value Proposition | A statement of what the business does, and how it is uniquely qualified to fill the need it addresses |
| Venture Capital | Venture capital firms or funds invest in early-stage companies in exchange for equity in the company. |
| Venture Debt | A type of loan usually provided to startups that have already successfully completed several rounds of venture capital equity fundraisings. These companies have a history of operations, butThese do not have sufficient positive cash flows to be eligible to obtain conventional loans. |
| W | |
| X | |
| Y | |
| Z | |
