Glossary

74 posts

The investing and venture capital community has a distinctive set of jargon unique to its field.

Investment Glossary

Starting a new business often involves joining an incubator or accelerator program, which provides support and resources to grow the startup. An effective elevator pitch can captivate an angel investor or venture capitalist, professionals who offer financial support for equity.

A well-structured capitalization table, showing the company’s equity ownership, is vital when seeking investment. Investors perform due diligence, investigating the startup’s value and risks before presenting a term sheet, outlining the investment’s basic terms.

Investors may offer committed capital or convertible loans that can be turned into equity later. Existing shareholders may experience dilution, where their ownership percentage reduces as new shares are issued.

Private equity firms are also involved in funding startups, differing from venture capitalists by investing in more established companies. The deal flow, representing the rate of business proposals and investment offers, is vital for investors.

A formal investment agreement may be preceded by a letter of intent, laying out the primary terms of the deal. Liquidity, referring to how quickly assets can be bought or sold, is another essential consideration for both investors and startups. Understanding these terms is crucial for successful fundraising and growth.

GGlossary

Reverse Merger

byBram Speelman
September 3, 2023

What is a Reverse Merger? A reverse merger is a process where a private company becomes publicly traded…

GGlossary

Data room for investors

byBram Speelman
September 3, 2023

In the world of early-stage venture deals and startup investment, trust and transparency between founders and investors are…

GGlossary

Founders agreement

byBram Speelman
September 3, 2023

Title: The Founders’ Agreement: Navigating Essential Agreements for Startup Success In the ever-evolving startup landscape, where innovation and…

GGlossary

Ebitda vs revenue

byBram Speelman
September 3, 2023

In the world of startups and venture capital, financial metrics play a pivotal role in evaluating the health…

GGlossary

Investment Memorandum

byBram Speelman
September 2, 2023

In the world of finance and business, clarity is paramount. When it comes to securing investments or making…

GGlossary

Deal Flow

byBram Speelman
September 1, 2023

What is Venture Capital Deal Flow? Venture Capital (VC) deal flow refers to the stream of investment opportunities…

GGlossary

Bear hug

byBram Speelman
August 31, 2023

What is a Bear Hug in Finance? A bear hug in finance refers to an unsolicited takeover bid…

GGlossary

Buyout Private Equity

byBram Speelman
August 30, 2023

Private equity (PE) is a type of investment that involves taking ownership stakes in private companies, rather than…

GGlossary

Berkus Valuation Method

byBram Speelman
August 29, 2023

The Berkus Method is a valuation approach used for companies that have yet to generate their first revenue.…

GGlossary

White Knight

byBram Speelman
August 28, 2023

What is a White Knight? In the world of business and finance, a “White Knight” is a term…