Startup Glossary
A program that supports early-stage, growth-driven companies through education, mentorship, and financing.
The process of one company purchasing most or all of another company’s shares to gain control of that company.
An individual who provides capital for a business startup, usually in exchange for convertible debt or ownership equity.
A comprehensive report on a company’s activities throughout the preceding year.
Anything of value that a company owns, such as cash, equipment, real estate, or intellectual property.
An official inspection of an individual’s or organization’s accounts, typically by an independent body.
A clause in an option, security, or merger agreement that gives the investor the right to maintain his or her percentage ownership of a company by buying a proportionate number of shares of any future issue of the security.
Money owed by a business to its suppliers shown as a liability on a company’s balance sheet.
Money owed to a company by its debtors shown as an asset on the company’s balance sheet.
The process of gradually writing off the initial cost of an asset.
The amount of sales or revenues generated per dollar of assets.
A financing event in which an angel investor invests capital in a startup in exchange for equity in the company.
A method of software development that values responding to change over following a plan.
The minimum price that a seller is willing to accept for a share of stock or other security.
A body that provides non-binding strategic advice to the management of a corporation, organization, or foundation.
Costs which a company has incurred but has not yet paid.
When a company is acquired primarily for the skills and expertise of its staff, rather than for its products or services.
The process of dividing and distributing, can refer to company resources, stocks, revenues, and more.
The practice of taking advantage of a price difference between two or more markets.
Company’s earnings that are related to its core operations and excludes any one-off, irregular or non-recurring transactions.
The option to terminate an investment or project earlier than originally planned.
A business that is owned by an individual who does not participate in the operation or management of the business.
A method in cost accounting where all manufacturing costs, both variable and fixed, are treated as product costs, regardless whether the units are sold or in inventory.
A measure of a company’s ability to cover its current liabilities with its most liquid assets.
An attachment added to a document such as an insurance policy that alters its terms or details.
An interest rate on a loan or security that fluctuates over time because it is based on an underlying benchmark interest rate or index.
A situation where sellers have information that buyers do not have, or vice versa, about some aspect of product quality.
A type of internal company expense which comes from the actions of an agent acting on behalf of a principal.
A marketing strategy where an affiliate earns a commission for marketing another company’s products or services.
The merger of one or more companies into a new entity.
Money that is owed and should have been paid earlier.
A method of resolving disputes outside of court in which a neutral third party makes a decision.
Technology that enables a machine or system to mimic human intelligence.
The process of developing, operating, maintaining, and selling assets in a cost-effective manner.
A record that shows who has accessed a computer system, when it was accessed, and what operations were performed.
An interactive experience of a real-world environment where the objects that reside in the real world are enhanced by computer-generated perceptual information.
The process of verifying the identity of a person or device.
An electronic network for financial transactions in the United States, that processes large volumes of credit and debit transactions in batches.
Vehicles capable of sensing its environment and operating without human involvement.
The total cost of production divided by the number of goods produced.
A negotiated and typically legally binding arrangement between parties.
The rate at which employees leave a company or customers stop subscribing to a service over a given period.
A situation in which one party in a transaction has more or superior information compared to another.
A system of buying and selling goods or services by offering them up for bid, and then selling to the highest bidder.
A group of people who participate in a show or encounter a work of art, literature, theatre, music, video games, or academics.
The human tendency to think that examples of things that come readily to mind are more representative than is actually the case.
The revenue recognized for every unit sold.
Revenue derived from non-core business activities, such as the sale of scrap, rent from surplus space etc.
The initial phase of testing in software development, where users try out the software in a controlled environment to spot any bugs or issues.
A set of rules to be followed in calculations or problem-solving operations, often used by a computer.
Any digital cryptocurrency similar to Bitcoin. The term is said to stand for “alternative to Bitcoin”.
The systematic computational analysis of data or statistics. It is used for the discovery, interpretation, and communication of meaningful patterns in data.
A mandatory yearly gathering of a company’s interested shareholders where they get a chance to ask questions and vote on important issues.
A set of rules and protocols for building and interacting with software applications.
The process of estimating the value of an asset or liability.
A person chosen to settle a dispute or make a decision in a matter, often used in contract disputes.
A group of securities or investments that have similar characteristics and behave similarly in the marketplace.
A metric used to understand the efficiency of a company’s utilization of its assets to generate revenue.
Communication that doesn’t require all parties to be available at the same time, such as email or message boards.
The risk that an auditor issues an incorrect opinion on the financial statements.
A procedure where the Option Clearing Corporation (OCC) will automatically exercise an “in the money” option for the holder.
A company that operates with minimal human intervention and uses artificial intelligence (AI) and other advanced technology to perform tasks.
In business, it refers to the ability of a customer to purchase a desired quantity of goods or services when and where they are needed.
A metric widely used in the hospitality industry to indicate the average realized room rental per day.
A per unit cost that represents the fixed costs of production distributed over the total quantity of output produced.
The behavior of humans, especially consumers and investors, who, when exposed to uncertainty, attempt to lower that uncertainty.
A department that provides support to the main, income-producing departments of a business.
A historical concept expressing the radical shift of thought in a period from the 8th to the 3rd century BC, seen in multiple civilizations.
A financial statement that reports a company’s assets, liabilities, and shareholders’ equity at a specific point in time.
A legal proceeding involving a person or business that is unable to repay outstanding debts.
A standard or point of reference against which things may be compared or assessed.
The second phase of software testing in which a sampling of the intended audience tests the product.
Extremely large data sets that may be analyzed computationally to reveal patterns, trends, and associations, especially relating to human behavior and interactions.
A marketing theory in which a company creates a new, uncontested market space, as opposed to competing in an existing industry.
To start a company with personal finances or operating revenues, which are initially low.
A type of product manufactured by a particular company under a particular name, or the unique image and name associated with a company.
The point at which total cost and total revenue are equal, i.e., the business has neither made a profit nor incurred a loss.
A short-term loan that provides immediate cash flow until the business can secure more permanent financing.
A company’s plan for how it will generate revenues and make a profit.
A formal written document containing the goals of a business, the methods for attaining those goals, and the time-frame for the achievement of the goals.
The purchase of a controlling percentage of a company’s stock.
The rules and regulations enacted by an association or a corporation to provide a framework for its operation and management.
The rate at which a new company spends its initial capital.
A type of commerce transaction that exists between businesses, such as those involving a manufacturer and wholesaler, or a wholesaler and a retailer.
Business or transactions conducted directly between a company and consumers who are the end-users of its products or services.
Technologies, applications and practices for the collection, integration, analysis, and presentation of business information to support better business decision making.
A method of subcontracting various business-related operations to third-party vendors.
Tasks and processes concerning analytical preparation of potential growth opportunities, and the support and monitoring of the implementation of growth opportunities.
A market in which share prices are rising, encouraging buying.
A market in which prices are falling, encouraging selling.
An estimate of income and expenditure for a set period of time.
In the context of software design, the back end is the server-side, which includes the server, the database, and the server-side applications.
In the tech world, a bounty program is a deal offered by websites, organizations, and software developers where individuals can receive recognition and compensation for reporting bugs.
The fluctuation in economic activity that an economy experiences over a period of time, characterized by periods of economic expansion and contraction.
The price a potential buyer is willing to pay for a product or service.
A system in which a record of transactions made in bitcoin or another cryptocurrency are maintained across several computers that are linked in a peer-to-peer network.
The commercial value that derives from consumer perception of the brand name of a particular product or service, rather than from the product or service itself.
A calculation of the approximate sales volume required to just cover costs, below which production would be unprofitable and above which it would be profitable.
An affluent individual who provides capital for a business start-up, usually in exchange for convertible debt or ownership equity.
A market which has more sellers than buyers. Low prices result from this excess of supply over demand.
The process involved in creating a system of prevention and recovery from potential threats to a company.
The study of appropriate business policies and practices regarding potentially controversial issues, such as corporate governance, insider trading, bribery, discrimination, corporate social responsibility, and fiduciary responsibilities.
Activities that businesses engage in on a daily basis to increase the value of the enterprise and earn a profit.
A viral marketing technique that is focused on maximizing the word-of-mouth potential of a particular campaign or product.
A fixed income instrument that represents a loan made by an investor to a borrower (typically corporate or governmental).
The final total of an account or balance sheet. In the context of business, the bottom line is the net income that is calculated after subtracting the expenses from revenue.
A traditional “street-side” business that deals with its customers face-to-face in an office or store that the business owns or rents.
Wealth in the form of money or other assets owned by a person or organization or available for a purpose such as starting a company or investing.
Funds used by a company to acquire or upgrade physical assets such as property, industrial buildings, or equipment.
The total amount of money being transferred into and out of a business, especially as affecting liquidity.
The highest-ranking executive in a company, whose primary responsibilities include making major corporate decisions, managing the overall operations and resources of a company.
A senior executive with responsibility for the financial affairs of a corporation or other institution.
An executive who is responsible for the daily operation of the company, and routinely reports to the highest-ranking executive, usually the chief executive officer (CEO).
An executive who is responsible for managing the technical aspects of a company’s strategy, to ensure that it aligns with its business goals.
The practice of funding a project or venture by raising small amounts of money from a large number of people, typically via the Internet.
Customer Relationship Strategies and technologies that companies use to manage and analyze customer interactions and data throughout the customer lifecycle, with the goal of improving business relationships with customers.
The cost associated with convincing a customer to buy a product/service.
A self-regulating business model that helps a company be socially accountable — to itself, its stakeholders, and the public.
The rate at which a company is losing money.
A type of short-term debt that converts into equity, typically in conjunction with a future financing round.
The direct costs attributable to the production of the goods sold by a company.
An agreement in which a borrower receives something of value now and agrees to repay the lender at a later date with consideration.
The annual percentage rate at which customers stop subscribing to a service.
The percentage of users who take a desired action.
A portfolio of pooled assets that raises a fixed amount of capital through an initial public offering (IPO) and then lists shares for trade on a stock exchange.
An asset or property that a borrower offers as a way for a lender to secure the loan.
A basic good used in commerce that is interchangeable with other goods of the same type.
A strategic marketing approach focused on creating and distributing valuable, relevant, and consistent content to attract and retain a clearly defined audience — and, ultimately, to drive profitable customer action.
An evaluation of the credit risk of a prospective debtor, predicting their ability to pay back the debt and an implicit forecast of the likelihood of the debtor defaulting.
A digital or virtual currency that uses cryptography for security and operates independently of a central bank.
A prediction of the net profit attributed to the entire future relationship with a customer.
The ability of a company or product to retain its customers over some specified period.
Identifying your competitors and evaluating their strategies to determine their strengths and weaknesses relative to those of your own product or service.
A strategy that aims to provide a product or service at as low a price as possible to a broad audience.
A systematic approach to estimating the strengths and weaknesses of alternatives used to determine options which provide the best approach to achieving benefits while preserving savings.
The action or practice of selling an additional product or service to an existing customer.
The practice of engaging a ‘crowd’ or group for a common goal — often innovation, problem-solving, or efficiency.
The beliefs and behaviors that determine how a company’s employees and management interact and handle outside business transactions.
The manner in which a corporation, firm or business presents themselves to the public, such as customers and investors as well as employees.
The risk of default on a debt that may arise from a borrower failing to make required payments.
An element that is necessary for an organization or project to achieve its mission.
The product of an interaction between an organization and a customer over the duration of their relationship.
A model that describes the relationship between systematic risk and expected return for assets, particularly stocks.
A marketing approach that is based on data and insights derived from customer interactions.
The sharing, swapping, trading, or renting of products and services, enabling access over ownership.
A metric that expresses the time (in days) it takes for a company to convert its investments in inventory and other resources into cash flows from sales.
The process of bringing new products or services to the market.
A method of raising capital by borrowing, typically through the issuance of bonds or obtaining a loan.
The reduction in the value of an asset over time, particularly in relation to its useful life.
The reduction in the ownership percentage in a company faced by existing investors, due to the issuance of new equity.
The interest rate used to determine the present value of future cash flows.
The disposal or sale of an asset by a company.
An investigation or audit of a potential investment or product to confirm all facts, such as reviewing all financial records, plus anything else deemed material.
The focus of targeted marketing programs to drive awareness and interest in a company’s products and/or services.
Statistical data relating to the population and particular groups within it which are used to identify markets and make marketing strategies.
Selling products directly to customers in a non-retail environment.
An innovation that significantly alters or creates a new industry and disrupts an existing one.
A distribution of a portion of a company’s earnings to its shareholders.
A fundraising round where companies sell shares at a lower price than in the previous round, resulting in dilution for existing investors.
A provision that enables a majority shareholder to force a minority shareholder to join in the sale of the company.
A comprehensive list used by investors and entrepreneurs to evaluate a business opportunity.
A tool used for information management and business intelligence, presenting key metrics and performance indicators for a business or project.
The practice of examining large databases to generate new information and insights.
The practice of protecting digital data from unauthorized access, corruption, or theft.
Failure to fulfill an obligation, especially to repay a loan.
The reduction of the general level of prices in an economy.
A tangible or intangible object produced as a result of a project that is intended to be delivered to a customer.
An unauthorized access and retrieval of sensitive information by an individual, group, or software system.
A financial metric indicating the relative proportion of shareholders’ equity and debt used to finance a company’s assets.
Payment received by a company in advance for services it has not yet provided or goods it has not yet delivered.
A term used to describe a failure to meet legal obligations or conditions, such as paying debts on time.
The quantity of a good that consumers are willing and able to purchase at various prices over a given period of time.
A continuous quality improvement model consisting of a logical sequence of four repetitive steps for continuous improvement and learning.
A financial security with a value that is reliant upon or derived from, an underlying asset or group of assets.
A price that can be directly tied to the production of specific goods or services.
The reduction in the use of intermediaries between producers and consumers, for example by investing directly in the securities market rather than through a bank.
The process of a business enlarging or varying its range of products or field of operation.
An initial payment made when something is bought on credit.
A reorganization of a company with an aim to improve efficiency and cost-effectiveness that often involves layoffs or reducing the workforce.
An auction in which the auctioneer begins with a high asking price, and then lowers it until someone accepts the price, or it reaches a predetermined minimum price.
Any publicity you haven’t paid for that’s owned and created by a third party.
An indicator of a company’s profitability, calculated as revenue minus expenses, excluding tax and interest.
A measure of a company’s operating performance, calculated as revenue minus expenses excluding tax, interest, depreciation, and amortization.
The portion of a company’s profit allocated to each outstanding share of common stock, serving as an indicator of the company’s profitability.
The number of units that a company should add to inventory with each order to minimize the total costs of inventory—such as holding costs, order costs, and shortage costs.
A measure of a company’s financial performance based on the residual wealth calculated by deducting its cost of capital from its operating profit, adjusted for taxes on a cash basis.
The cost advantage that arises with increased output of a product.
A brief, persuasive speech that you use to spark interest in what your organization does.
A stock option granted to specified employees of a company. ESOs offer the options holder the right to buy a certain amount of company shares at a predetermined price for a specific period of time.
Ownership interest in a corporation in the form of common stock or preferred stock.
The process of raising capital through the sale of shares.
A strategy a business owner uses to sell their stake in a company to investors or another company.
An economic cost paid immediately, which reduces business equity and earnings.
The phase of the business cycle when the economy moves from a trough to a peak.
The evaluation of the external environment that affects the performance of a company, including industry and market analysis.
A short document or section of a document produced for business purposes that summarizes a longer report or proposal or a group of related reports.
An individual who creates a new business, bearing most of the risks and enjoying most of the rewards.
The price of one country’s currency in terms of another currency.
A psychology theory in which individuals value something more when they own it.
The degree of attention that consumers show to a brand, product, or service.
The first group of consumers to adopt a new technology or product.
The group of consumers who start using a new product or technology just before the average person.
A contractual provision stating that the seller of a business is to obtain additional compensation in the future if the business achieves certain financial goals.
A profitability measure equal to EBIT divided by revenue.
A distributed computing paradigm that brings computation and data storage closer to the location where it is needed, to improve response times and save bandwidth.
The degree to which a demand or supply is sensitive to changes in price or income.
The use of email to promote products or services and develop relationships with potential customers or clients.
An organization’s ability to keep its employees.
Granting employees power and resources to make decisions and solve problems without having to seek approval from management.
The conversion of data into a code to prevent unauthorized access.
The person or organization that uses a product or service.
Enterprise Resource Business process management software that allows an organization to use a system of integrated applications to manage the business and automate many back-office functions related to technology, services, and human resources.
The social and economic environment affecting local or regional entrepreneurship.
The analysis of external forces that affect an organization’s success and ability to compete in the marketplace.
A method of raising capital through the collective effort of friends, family, customers, and individual investors.
Content that continues to be relevant long past its publication so that it always remains valuable to readers.
An assessment of the practicality of a proposed project or system.
A person or organization that owes to another the duties of good faith and trust.
An estimate of future financial outcomes for a company or project.
The use of borrowed money to increase the potential return of an investment.
The advantage gained by the initial significant occupant of a market segment.
Costs that do not change with the level of production or output.
Work arrangements in which employees have flexibility in scheduling and location.
A diverse group of people assembled to participate in a guided discussion about a product before it is launched.
The process of estimating future trends or outcomes based on historical data.
A type of license that a party (franchisee) acquires to allow them to have access to a business’s (franchisor) proprietary knowledge, processes, and trademarks in order to allow the party to sell a product or provide a service under the business’s name.
A business model where a product is provided free of charge, but money is charged for additional features, services, or virtual goods.
A stage of startup investment, wherein investors purchase equity from a company.
The act of collecting or producing money for a particular purpose, especially for a charity or other nonprofit organization.
The value of an asset or cash at a specified date in the future that is equivalent in value to a specified sum today.
Long-term tangible pieces of property or equipment that a firm owns and uses in its operations to generate income.
A one-year period that companies and governments use for financial reporting and budgeting.
The nominal or dollar value of a security stated by the issuer.
A financial transaction and a type of debtor finance in which a business sells its accounts receivable to a third party (called a factor) at a discount.
The price at which a good or service would change hands between a willing buyer and willing seller, neither being under any compulsion to buy or sell and both having reasonable knowledge of the relevant facts.
Industries composed of companies that use technology to make financial services more efficient.
An early round of business financing from family and friends.
A company that quickly imitates the innovations of its competitors.
An evaluation and analysis of the potential of a proposed project to support the process of decision making.
The central bank of the United States, which regulates the U.S. monetary and financial system.
A financial grant for advanced study or research, usually given to a researcher.
A legal responsibility to act in the best interests of another.
Government policy relating to setting tax rates and spending levels to monitor and influence a nation’s economy.
An interest rate on a liability, such as a loan or mortgage, that remains the same either for the entire term of the loan or for part of the term.
The number of shares available for trading of a particular stock.
The presence and movement of people walking around in a particular space, especially considered in terms of its potential for sales, as in a retail environment.
A business strategy that involves a form of vertical integration whereby business activities are expanded to include control of the direct distribution or supply of a company’s products.
A unit that indicates the workload of an employed person in a way that makes workloads or class loads comparable across various contexts.
The total number of shares that would be outstanding if all possible sources of conversion, such as convertible bonds and stock options, were exercised.
The process of completing an order to the satisfaction of the customer, including all activities from processing the order to delivery.