Startup Glossary
Powered by the Coller School of Management, Tel Aviv University
Welcome to our comprehensive Tech and Startup Glossary! From A to Z, we’ve compiled a collection of tech-related terms and their concise explanations to help you navigate the ever-evolving world of technology. Whether you’re a seasoned IT professional or just beginning your tech journey, our glossary is your go-to resource for unraveling the complexities of the digital realm. Explore and expand your technical knowledge with ease.
The glossary is a joint endeavor of The Ecosystem with the Coller Institute of Venture at Tel Aviv University, aiming to curate all the ‘must-know’ terms for every venture founding team.
A/B Testing
A/B testing, also known as split testing, is a method used in marketing and product development to compare two versions of a webpage or app to determine which one performs better. It involves dividing the audience into two groups, with each group being shown a different version of the webpage or app. The performance of each version is then measured and analyzed to determine which one leads to better outcomes, such as higher conversion rates or increased user engagement.
AML (Anti Money Laundering)
Anti-money laundering (AML) is the general term for the laws, rules, and processes that prevent money laundering. Customer due diligence is applied to screening and validating prospective clients under Know Your Client (KYC) standards.
AR (Augmented Reality)
AR is an interactive experience that combines the real world and computer-generated content. The content can span multiple sensory modalities, including visual, auditory, haptic, somatosensory and olfactory. AR can be defined as a system that incorporates three basic features: a combination of real and virtual worlds, real-time interaction, and accurate 3D registration of virtual and real objects
ARPU (Average Revenue Per User)
A metric commonly used in SaaS to measure the revenue generated by an average customer or user over a certain period. ARPU can track revenue changes over time and compare the performance of different products or services. It also helps inform pricing, marketing, and customer acquisition strategy decisions.
ARR (Annual Recurring Revenue)
Annual recurring revenue is predictable income that a business receives each year. Annualised version of MRR.
Accelerator
A startup acceleration program is a structured and often mentor-based program designed to help early-stage startup companies grow and scale rapidly. These programs offer various forms of support, guidance, and resources to assist startups in achieving their goals
Acquihire
The act of acquiring a company for the purpose of hiring the team behind it. Key employees may be tied in for a specified period of time.
Acquisition
An acquisition is when one company or investment group buys another company. This is a common mechanism for exit.
Advisory Board
A group of experts and specialists selected by a company’s CEO and management team to provide advice and support for business development. A board of advisors is an opportunity for startups to fill skill gaps in leadership and, ideally, get unbiased perspectives. Board advisors tend to specialize in a particular area of knowledge, such as finance, law, product development, or accounting.
Agile
Agile methodology is a project management framework that breaks projects down into several dynamic phases, commonly known as sprints. The Agile framework is an iterative methodology. After every sprint, teams reflect and look back to see if there was anything that could be improved so they can adjust their strategy for the next sprint.
Ai (Artifiical Inteligence)
Artificial intelligence (AI) is the ability of a computer or a robot controlled by a computer to do tasks that are usually done by humans because they require human intelligence and discernment.
Alpha
A pre-release version of a product. This is often still part of the testing process.
Analytics (Web)
Web analytics is the measurement, collection, analysis, and reporting of web data to understand and optimise web usage.
Angel Investor
An angel investor is someone who invests their own capital into the growth of a business at an early stage.
Anti-dilution Clause
A contractual clause that protects an investor from having their investment (as a percentage of ownership) significantly reduced in subsequent fundraising rounds
Authorized Shares
Shares in a company that have been sold publicly. They fall within the maximum number of shares a company can sell according to the corporate charter.
B2B (Business to Business)
When the customer and the end user is a business
B2B2C (Business to Business to Customers)
B2B2C represents a business model where a company sells its products or services to other businesses (B2B) with the ultimate aim of reaching and serving their end consumers (B2C) through those intermediary businesses.
B2C (Business to Customers)
Represents a business model where a company sells its products or services directly to individual consumers who are the end-users. In a B2C transaction, there is no intermediary between the business and the consumer.
B2G (Business to Government)
Represents a business model where companies sell their products or services to government entities at the federal, state, or local level. In a B2G transaction, businesses are the suppliers, and government agencies are the customers.
BHAG
Big Hairy Audacious Goal. An extremely ambitious target to motivate progress.
BMC (Business Model Canvas)
The BMC is a strategic management tool that helps businesses visually map out and analyze their business model. It provides a structured framework for businesses to understand and communicate key aspects of their business, such as customer segments, value propositions, channels, customer relationships, revenue streams, key resources, key activities, key partnerships, and cost structure.
Back-End
Back-end refers to the part of a software application or website that is responsible for processing and storing data. It is the behind-the-scenes functionality that is not visible to the user but is essential for the proper functioning of the application.
Balance sheet
A financial statement that reports a company’s assets, liabilities, and shareholder equity. This is used to evaluate the business at the date of publication.
Beta Release
A beta release is a version of a software or product that is made available to a limited number of users for testing and feedback purposes. It is typically the second phase of software testing, following the alpha release.
Bitcoin
A cryptocurrency, a virtual currency designed to act as money and a form of payment outside the control of any one person, group, or entity, thus removing the need for third-party involvement in financial transactions. It is rewarded to blockchain miners for the work done to verify transactions and can be purchased on several exchanges.
Blockchain
Blockchain is a decentralized digital ledger technology that records transactions across multiple computers in a secure and immutable way. It consists of a chain of blocks, each containing a set of transactions. These blocks are linked together in chronological order, forming a chain, hence the name “blockchain.”
Blue Ocean and Red Ocean
Blue ocean is a business strategy focusing on creating new market spaces rather than competing in existing ones. A red ocean is an existing market with many competitors, while a blue ocean is a market yet to be discovered with no competitors
Board of Directors
A Board of Directors (BoD) is the governing body of a company or organization responsible for overseeing its strategic direction, decision-making, and overall management. The board is typically composed of a group of individuals elected or appointed to represent the interests of the company’s shareholders or stakeholders
Bootstrapping
A startup which is able to self-finance, often eliminating the need for seed or angel investment rounds. This can be achieved through early revenue generation, lean operations.
Bounce Rate
Bounce rate is a metric that measures the percentage of website visitors who leave a website after viewing only one page. It indicates the level of engagement and interest of visitors on a website. A high bounce rate typically suggests that visitors are not finding what they are looking for or are not engaged with the content, while a low bounce rate indicates that visitors are exploring multiple pages and engaging with the website. Bounce rate can be influenced by various factors such as website design, content relevance, loading speed, and user experience.
Bridge
Short-term funding that helps the startup access money in between rounds of funding. A bridge may be non-dilutive (bridge loan) or dilutive (bridge round). A bridge is usually not perceived as a positive signal as it indicates the company didn’t reach its expected target, hence the need for a bridge.
Bubble
A bubble describes a timeframe in an economic ecosystem where an industry does not realise that it might be overvalued and over-inflated.
Burn Rate
Rate at which a company spends cash reserves to cover expenses, expressed monthly or weekly. Usually applied to a company with little or no revenues.
Business Model
The term business model refers to a company’s plan for making a profit. It identifies the products or services the business plans to sell, its identified target market, and any anticipated expenses.
Buyout
An investment transaction where one party buys all or the majority of a company’s shares to gain control of the target company.
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CAC (Customer Acquisition Cost)
An important metric in unit economics, the CAC allows a company to keep track of how much it costs to acquire a new customer. Calculated as direct acquisition costs (generally marketing and sales expenses) divided by the number of new customers, the CAC allows a startup to understand which channels deliver the best ROI for marketing spend.
CBDO (Chief Business Development Officer)
The CBDO is responsible for establishing and executing the organization’s Business Development strategy, which includes: identifying unique non-organic growth opportunities, including partnerships, alliances, collaborations, platforms, etc.
CEO (Chief Executive Officer)
A startup CEO is responsible for overseeing all aspects of the business, including developing and implementing overall strategy, building and leading a strong team, raising capital, and establishing partnerships with stakeholders.
CFO (Chief Financial Officer)
The CFO plays a critical role in managing fundraising and investor relations to ensure the company has adequate financial resources to support growth and innovation.
CMO (Chief Marketing Officer)
A chief marketing officer (CMO) is the executive in charge of an organisation’s strategic marketing initiatives. They steer the overarching direction of a brand’s marketing communications.
CPO (Chief Product Officer)
A chief product officer (CPO) is the executive in charge of an organisation’s strategic product initiatives. They steer the overarching direction of a brand’s product, including features and how to articulate them.
CRM (Customer Relationship Management)
CRM refers to the process (but is generally synonymous with software enabling the process) of keeping track of and managing customer relationships.
CRO (Chief Revenue Officer)
A chief revenue officer is a corporate officer responsible for all revenue generation processes in an organization. In this role, a CRO is accountable for driving better integration and alignment between all revenue-related functions, including marketing, sales, customer support, pricing, and revenue management
CRUD
CRUD stands for Create, Read, Update, and Delete. It is a set of basic operations that can be performed on data in a database or any other persistent storage system.
CSO (Chief Sales Officer)
The Chief Sales Officer (CSO) takes charge of your company’s sales department, steering it towards achieving revenue and sales growth objectives. Their main focus is on sealing deals, which involves overseeing various aspects, including sales team training, daily operations, and customer relationship management.
CTO (Chief Technology Officer)
A chief technology officer (CTO) is the executive in charge of an organisation’s technological needs and strategic decision making in terms of tech. Often in technology start-ups the CTO is a co-founder and/or shareholder.
CVC (Corporate Venture Capital)
The investment of corporate funds into external startup companies.
Cap Table
An official document that described the capital structure of a startup, generally used to view the percentage ownership that each investor or employee owns of the company.
Capital
Capital is a term for financial assets, such as funds held in deposit accounts and/or funds obtained from special financing sources such as investment or loans.
Cash Flow
Cash flow is the net amount of cash and cash equivalents flowing into and out of a company. Typically a startup can have 4 sources of cash: Equity Funding (allocating shares to investors), Debt (Loans taken from banks or other institutes) Sales (cash from customers, which is the best), Various grants and prizes (winning research grants and or competitions etc.)
Centaur
A startup that has $100 million in annual recurring revenue.
Chasm
The transition from a little-known product to the mainstream. If a startup can successfully cross the chasm, they have the opportunity for mainstream success and hypergrowth. The concept stems from the renowned book “Crossing the chasm” by Geoffrey Moore.
Churn Rate
Churn rate is the rate at which customers or employees stop doing business with a company or organization. It is typically expressed as a percentage of customers or employees who leave within a given time period.
Click Bait
Click Bait refers to a type of online content, such as headlines or thumbnails, that are designed to attract attention and encourage users to click on the link. The content often exaggerates or misrepresents the actual information or story, leading to disappointment or frustration for the user. Click bait is commonly used to generate website traffic and increase ad revenue.
Cliff
Usually applying to vesting schedules, Cliff vesting is when an employee or investor becomes fully vested on a specified date rather than becoming partially vested in increasing amounts over an extended period.
Commercialization
The process by which products or services are brought to the market. For example, the process by which mRNA research transitioned into a publicly available COVID-19 vaccine.
Common Stock
A class of stock that represents ownership in a company. It is the basic form of stock issued by any company.
Competitive Landscape
The competitive landscape refers to the list of options a customer could choose rather than your product. The list includes your competitors’ products and other types of customer solutions.
Content Marketing
A form of marketing which involves the creation and distribution of content (in any medium) that does not explicitly promote a brand but is intended to generate interest in products or services.
Conversion Rate Optimisation
The methodical process of making iterative changes to a website or app to increase the percentage of users who take a desired action.
Convertible Note
Put simply, a Convertible Note (CN) is debt finance, a type of convertible security that converts into equity. In terms of using a convertible note for seed funding, the debt automatically converts into shares when Series A closes. Rather than a loan from a creditor accumulating interest, a convertible note from an investor converts into equity based on pre-agreed terms
Crowdfunding
Crowdfunding is a funding method that involves raising small amounts of money from a large number of individuals, typically via online platforms or websites. This approach allows individuals or organizations to finance various projects, initiatives, or business ventures by tapping into a diverse pool of backers or investors.
Crowdinvesting
A form of crowdsourcing where individuals get equity in return for their funding. Because this is a heavily regulated environment, crowdinvesting is usually done via specialized crowdinvesting platforms.
Customer Discovery
Customer discovery means identifying who the right customer is for your product while simultaneously finetuning your offering to suit their needs. At this stage you are testing assumptions and hypotheses to validate the customer you’ve identified and their “problem” or need.
Customer Success Manager
A customer success managers (CSM) supports your customers as they transition from sales prospects to active users of your products. They’re focused on customer loyalty and building close long-term client relationships.
Data Room
A data room (also known as a virtual data room) is an online repository of information that is used for the storing and distribution of documents. Generally used to house documents relating to due diligence in funding rounds.
Debt Capital
Debt capital is the capital/finance that a business raises by taking out a loan or other financial security (in this context, debt capital can be an alternative to equity capital).
Dedacorn
Startups with a valuation of more than $10 billion. Derived from the famous concept of “unicorn startup”.
Demo Day
An event organized by an accelerator, incubator, or VC firm where founders formed by that organization pitch their product to investors.
Design Partner
Trusted product testers who provide critical feedback and help fill in missing gaps in a company’s product offering during the early stage of product development.
DevOps
A set of cultural philosophies, practices, and tools aimed at improving and automating the collaboration and communication between development (Dev) and IT operations (Ops) teams within an organization. The primary goal of DevOps is to streamline and accelerate the software development and delivery process, ensuring that applications and services are delivered more efficiently and with higher quality
Dilution
Dilution occurs when a startup issues new shares that result in a decrease in existing shareholders’ ownership percentage of that company.
Disruption
“Disruptive innovation” is a term coined by Clayton Christensen, referring to a process in which an underrated product or service starts to become popular enough to replace, or displace, a conventional product or service Those disrupting solutions are often cheaper than the existing solutions and have a more focused and relevant offering to the customer.
Dividend
A dividend is the distribution of a company’s earnings to its shareholders and is determined by the company’s board of directors.
Down Round
Down Round refers to a situation in which a company raises capital by issuing new shares of stock or securities at a lower valuation per share than the valuation established in a previous financing round. In other words, the company’s valuation decreases in a down round compared to its earlier funding rounds
Due Dilligence
The process performed by investors to assess the viability of an investment target, and to ensure that the information provided by the startup is accurate.
EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization)
This is a popular and widely used method for measuring the financial health of a company and their ability to generate cash.
EIR (Entrepreneur in residence)
It is a position in a company (usually a VC firm) that is a short-term role where an experienced entrepreneur is brought in to develop a new business. The firm is often willing to financially support the EIR’s business idea.
ERP (Enterprise Resource Planning)
Enterprise resource planning (ERP) is a platform companies use to manage and integrate the essential parts of their businesses.
ESG
Environmental, social and governance (ESG) is a framework used to assess an organization’s business practices and performance on various sustainability and ethical issues
Early Adopters
Customers who use the startup’s product or service before the general public does. These users can offer the startup honest and direct feedback, which can be used to improve the product before expanding to a larger audience. The concept was coined by Rogers in his Diffusion of Innovation (DOI) Theory.
Ecosystem
An environment formed by business-oriented people and startups in various stages and organizations for the creation and scaling of new startup companies. Read our book, The Ecosystem, to find out more 
Elevator Pitch
An elevator pitch is a concise and persuasive speech or presentation that is typically delivered in the time it takes for an elevator ride, which is usually around 30 seconds to 2 minutes. The goal of an elevator pitch is to provide a brief and compelling overview of a product, service, idea, or oneself to capture the listener’s attention and generate interest.
Equity
The value of shares issued by a startup (or other company). e.g. she owns 63% of the startup’s equity.
Equity Capital
Equity capital is the capital/finance that a business raises from investors in exchange for equity or stock (in this context, equity capital can be an alternative to debt capital).
Ethereum
Ethereum is a decentralized blockchain platform that allows developers to build and deploy decentralized applications (dApps). It is powered by its own cryptocurrency, ether (ETH).
Evangelist
A person who believes so much in a product or service that they freely try to convince others to use it.
Exit
When a founder ends their involvement in the business, usually via a liquidity event (selling their shares to investors or to another company). The main two types of exits are an acquisition and an IPO.
Exit Strategy
An exit strategy is a Founder’s plan to sell their ownership in a company to investors/another company.
FDA (Food and Drug Administration)
The FDA is responsible for protecting the public health by assuring the safety, efficacy, and security of human and veterinary drugs, biological products, medical devices, food supply, cosmetics, and products that emit radiation
FFF (Friends, Family, and Fools)
The people who fund early-stage startups, often at the pre-seed stage. Also known as the “3F”
Family office
A private fund investing on behalf of a single high-net-worth individual, family (Single Family Office), or group of families (Multi Family Office). Family offices may invest in startups or in VC funds, although that’s just a small part of their activities.
Finder’s Fee
A finder’s fee (also known as “referral income” or “referral fee”) is a commission paid to an intermediary or the facilitator of a transaction. The finder’s fee is rewarded because the intermediary discovered the deal and brought it to the attention of interested parties. The presumption is that without the intermediary, the parties never would have found the deal, and the facilitator thus warrants compensation.
Follow-on Funding
The process of VC firms investing in the later rounds of companies in their portfolios that they have already invested in in order to avoid dilution.
Founder
The person who launches the business, often with co-founders. A grander definition may be “a person or enterprise attempting to find innovative ways to solve an existing problem or fill a gap in the goods or services market”.
Founders Agreement
A contract that a company’s founders enter where they set guidelines for their business relationships. Specifically, founders agreements outline each founder’s rights, roles, responsibilities, compensation, and obligations. Also known as a co-founders agreement, this written legal document sets expectations for each founder so everyone’s on the same page.
Freemium
A business model and\or a marketing tactic where customers are offered a restricted version of a product or service at no cost. Additional features are available at a cost.
Fundraising
Generally a term used to represent the process of generating capital via exchanging equity for external investment (can also include alternative means of generating capital such as crowdfunding or debt finance).
GDPR
The General Data Protection Regulation (GDPR) is the toughest privacy and security law in the world. Though it was drafted and passed by the European Union (EU), it imposes obligations onto organizations anywhere, so long as they target or collect data related to people in the EU. The regulation was put into effect on May 25, 2018. The GDPR will levy harsh fines against those who violate its privacy and security standards, with penalties reaching into the tens of millions of euros.
GTM (Go-to-Market Strategy)
A go-to-market (GTM) strategy is a step-by-step plan designed to successfully launch a product or service to market.
Gamification
Through gamification, a startup can add a game-layer to a product or service that encourages users (via Motivation Theory) to take a specific action in exchange for a reward.
General Partner
A manager at a VC fund. They sit at the top of the VC job pyramid.
Grant
An award (often financial) that is given by one entity to another in order to help them facilitate a goal. For example, governments and large corporations usually run grant programs to support startups and innovative companies.
Growth Hacking
Growth hacking is a catch-all term for strategies focused solely on growth (revenue or users). It is generally used in relation to startups who require substantial growth in a short period of time on relatively small budgets. Read more.
Hackathons
A hackathon is an event that brings together people and creates a collaborative environment for solving a certain problem. The word hackathon is a combination of “hack” and “marathon.” So, essentially it’s a marathon for hackers.
Hard Skills
Hard skills are technical skills required for a job. They are learned abilities acquired and enhanced through education and experience.
Hectocorn
A startup with a valuation of over $100 billion.
Hockey Stick
A term use to represent a growth chart/graph showing sudden and exponential growth.
Hype
Hype in startups refers to the excessive or exaggerated promotion and excitement surrounding a new startup company, product, or service. It often involves creating a buzz or generating a lot of attention and anticipation, sometimes through marketing tactics, media coverage, or social media campaigns
Hype Cycle
Gartner’s Hype Cycle is a graphical depiction of a common pattern that arises with each new technology or other innovation. Each year, Gartner creates more than 90 Hype Cycles in various domains as a way for clients to track technology maturity and future potential. The five phases in the Hype Cycle are Technology Trigger, Peak of Inflated Expectations, Trough of Disillusionment, Slope of Enlightenment and Plateau of Productivity.
ICO (Initial Coin Offering)
The cryptocurrency equivalent to an IPO. A startup looking to raise funds to create a service, app, or coin can use an ICO to raise funds.
ICP (Ideal Customer Profile)
An Ideal Customer Profile (ICP) represents the types of companies that need your product enough that they would pay for it. Your ICP will need to include personas for your user and your buyer. A user represents the direct consumer of your solution, and a buyer represents the person with the influence and authority to make a purchasing decision.
IOT
The internet of things, or IoT, is a network of interrelated devices that connect and exchange data with other IoT devices and the cloud. IoT devices are typically embedded with technology such as sensors and software and can include mechanical and digital machines and consumer objects.
IP (Intellectual Property)
A category of property that can be legally protected. Types of IP include patents, trademarks, copyrights, and trade secrets.
IT (Information Technology)
Information technology (IT) is a broad professional category covering functions including building communications networks, safeguarding data and information, and troubleshooting computer problems.
Impact \ Social Venture
An undertaking by a firm or organization established by a social entrepreneur that seeks to provide systemic solutions to achieve a sustainable, social objective. These are often mission-driven.
In-kind support
Resources besides money (i.e. mentorship, connections, service, or supplies).
Incremental Innovation
Incremental innovation is a series of small improvements or upgrades made to a company’s existing products, services, processes or methods. The changes implemented through incremental innovation are usually focused on improving an existing product’s development efficiency, productivity and competitive differentiation.
Industry 4.0
The concept of integrating smart manufacturing machinery, AI-powered automation, and advanced analytics to help workers and factories become more efficient.
Innovation
Innovation refers to the process of introducing new ideas, methods, products, or services that bring about significant improvements, advancements, or changes in various aspects of life, business, technology, or society as a whole. It involves the creative application of knowledge, resources, and technology to solve problems, meet needs, or seize opportunities.
Intrapreneur
An employee of a large corporation who is given, or taken, the freedom and financial support to create new products, services, systems, etc., within the corporation, yet does not have to follow the corporation’s usual routines or protocols.
Investment Syndicate
A group of investors that agree to participate in an investment round of funding for a startup.
KPIs
Key performance indicators. These show the progress of a startup and highlight areas that need improvement.
KYC (Know Your Customer)
It describes the process of verifying the identity of (new) customers. The KYC process is performed to prevent illegal activities such as money laundering or fraud, in return protecting both company and client.
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KPIs
Key performance indicators. These show the progress of a startup and highlight areas that need improvement.
KYC (Know Your Customer)
It describes the process of verifying the identity of (new) customers. The KYC process is performed to prevent illegal activities such as money laundering or fraud, in return protecting both company and client.
LTV (Lifetime Value)
This is the amount a startup can expect to earn from a customer during the time they are with the company.
Landing Page
In marketing, a landing page is traditionally a standalone web page created for a specific advertising campaign. The term is now used more broadly to include any transactional or marketing-focused web pages.
Lead Investor
An investor who organizes the funding round and invests the largest amount of capital in that round.
Lean Canvas
Lean Canvas is a 1-page business plan template created by Ash Maurya that helps you deconstruct your idea into its key assumptions. It is adapted from Alex Osterwalder’s Business Model Canvas and optimized for Lean Startups.
Lean Startup
Lean Startup is a methodology and approach to building and launching businesses, products, or services with the goal of minimizing waste, maximizing efficiency, and increasing the chances of success. It was developed by Eric Ries and is particularly popular in the entrepreneurial and startup communities
Licensing
A business arrangement where a company sells the right to use their IP to another company to use its brand (trademark), copyrights, or a specific technology, usually patented or protected by trade secrets.
Limited Partner
An investor in a VC firm who provides capital yet has nothing to do with the day-to-day operations. Limited partners may be institutionals (endowments, pension funds…) or private entities (HNWI, family offices…).
Liquidity Event
An event that allows founders and early investors in a company to cash out some or all of their ownership shares. This is often the result of an acquisition, merger, or IPO.
MRR (Monthly Recurring Revenue)
Monthly recurring revenue is a predictable income that a business receives each month. Often a key metric in SaaS or subscription-based models.
MVP (Minimum Viable Product)
A minimum viable product (MVP) is a version of a product with enough features to be usable by early customers, used to validate a business or product idea. These customers then provide feedback for future product development.
Machine Learning
Machine Learning is a subfield of artificial intelligence (AI) and computer science that focuses on the development of algorithms and models that enable computer systems to learn and make predictions or decisions without being explicitly programmed. Machine learning algorithms use data to identify patterns, make predictions, and improve their performance over time
Market Share
The percentage of a total market that your startup will win as customers, within a given timefame.
Marketing Automation
Marketing automation is the process of using software to automate marketing activities. Most commonly used for email, automation put simply is using triggers to begin specific actions. For example, when a user signs up for a newsletter they receive at automated welcome email.
Media Spend
Money which is spent directly on advertising (paid search, paid social, display advertising etc) as opposed to fees charged my marketing agencies or other associated costs.
Metaverse
The metaverse is the emerging 3-D-enabled digital space that uses virtual reality, augmented reality, and other advanced internet and semiconductor technology to allow people to have lifelike personal and business experiences online.
Metrics
A way to measure company growth via a quantifiable measure to track, monitor, and assess the success or failure of the business’s processes.
Micro-VC
Venture capital funds that focus on making smaller investments in early-stage companies, often at the seed stage. These funds often have less capital available and smaller fund sizes.
Mind Mapping
A Mind Map is an easy way to brainstorm thoughts organically without worrying about order and structure. It allows you to visually structure your ideas to help with analysis and recall.
Mockup
A mockup is a visualization or design of an app, web page, or product that illustrates what the final outcome might look like. In user experience (UX) design, mockups define the purpose and intent of a design, often including visual elements such as structure, layout, color schemes, typography, and editorial copy.
Monetize
The process of deriving revenue from the users of your product or service.
Moonshot
An ambitious and ground-breaking project where the risks and potential benefits are difficult to assess. Moonshot projects often take years to come to fruition.
Network Effect
A phenomenon in which the value of a product, service, or platform depends on the number of buyers, sellers, or users who leverage it. Typically, the greater the number of buyers, sellers, or users, the bigger the network effect. Examples of successful network effects include Facebook and YouTube for social media, Uber and Lyft for rideshare, and Etsy for e-commerce.
No-Code Development
No-code development is a type of web development that allows non-programmers and programmers to create software using a graphical user interface, instead of writing code.
OKRs (Objectives and Key Results)
This helps companies define objectives and then track the outcomes. It is designed to achieve far-reaching goals in days instead of months.
Options
stock option (also known as an equity option), gives an investor the right, but not the obligation, to buy or sell a stock at an agreed-upon price and date.
PMF (Product-Market Fit)
When a new product launched on the market generates non-trivial revenue and growth, therefore proving that there was a demand for that innovation. Product-market fit (PMF) is the first major milestone of every startup.
POC (Proof of Concept)
A Proof of Concept (POC) is a preliminary demonstration or experiment conducted to determine the feasibility and viability of an idea, concept, or technology. It is a crucial step in the early stages of a project, product development, or innovation process. The primary purpose of a POC is to assess whether a concept or solution can be practically implemented and whether it will perform as expected.
PPC (Pay Per Click)
PPC affords businesses the opportunity to advertise within the sponsored listings of a search engine or a partner site by paying either each time their ad is clicked.
Paas (Platform as a Service)
PaaS (platform-as-a-service) is a form of cloud computing that enables software developers to build, run, and manage software applications easily, without worrying about underlying infrastructure
Pitch Deck
A pitch deck is a presentation that covers all aspects of your business and it’s revenue model, targeted at generating investment from Angels, VCs etcetera.
Pivot
The act of using experience and existing resources to transform a failed product or service into a successful one.
Pony
A startup with a valuation of more than $10 million.
Portfolio Company
A company that has received an investment from a VC fund or Angel becomes a portfolio company of that fund/person.
Positioning / Brand Positioning
Brand positioning refers to the unique position that a brand occupies in the minds of its target customers. It is the way a brand differentiates itself from its competitors and communicates its value proposition to its target audience.
Post-IPO Debt
Similar to debt funding, this occurs when a firm borrows money after the IPO and must pay it back within a set timeframe with interest.
Post-IPO Equity
Occurs when a firm invests in a company after the IPO is complete.
Post-money Valuation
The approximate market value given to a startup after a round of financing from angel investors or venture capitalists has been completed. The post-money valuation is equal to the pre-money valuation plus the amount invested.
Pre-Seed Round
This stage typically refers to the period in which a company’s founders are first getting their operations off the ground, and is often funded by the founders themselves (or friends and family) to cover the costs of launching operations or developing an minimum viable product (MVP).
Pre-money Valuation
Pre-money valuation refers to the value of a startup not including external funding/investment. How much a startup is worth before it begins to receive any investments.
Preferred Stock
Type of stock that comes with special privileges that is given to VCs to mitigate their investment risk.
Priced Round
Funding round where investors purchase newly issued stock in a company at an agreed-upon price per share. The price per share is determined by the valuation.
Private Equity
Private equity is composed of funds – capital that is not listed on a public exchange – that is directly invested in private companies. Investors utilise private equity (PE) funds to earn returns that are better than what can be achieved in public equity markets or standard savings mechanisms.
Product Manager
A product manager is the person who identifies the customer need and the larger business objectives that a product or feature will fulfill, articulates the product vision and often manages the team building the product.
Product Marketing
A specialism within marketing, product marketing is the process of bringing a product to market. This includes deciding the product’s positioning and messaging, launch strategy, and ensuring potential users understand the value of the product feature set, with a view to increasing demand.
Product Roadmap
A product roadmap is a high-level visual summary that outlines the vision and direction of your product offering, typically focusing on features and user benefits. Some companies choose to make the roadmap public.
Prototype
An initial model of an object built to test a design. This allows the startup to see if the concept can be viable before building and launching at scale.
Quantum Computing
An advanced and rapidly emerging technology that harnesses the principles of quantum mechanics to perform computational tasks that are fundamentally impossible or highly impractical for classical computers. Quantum computers are designed to leverage the unique properties of quantum bits, or qubits, to perform complex calculations and solve problems more efficiently in certain domains.
R&D (Research and Development)
The process by which companies innovate and improve their existing offerings and/or introduce new products and services to the market.
R&D Manager
R&D managers are responsible for leading teams of researchers and developers to create new products and improve existing ones. They work closely with the CTO to develop and implement the company’s technical strategy. The key difference between R&D managers and CTOs is that R&D managers are more focused on the day-to-day management of research and development teams, while CTOs have a broader responsibility for the company’s overall technology strategy.
ROI (Return on Investment)
The money an investor in a business earns for their investment of capital into the company. Any return is from the net profit the business makes. A good ROI is considered 7% or greater.
Referral Marketing
Referral marketing is a marketing tactic that makes use of recommendations and word of mouth to grow a business’s customer base through the networks of its existing customers.
Retention
The rate at which the startup retains its users or customers. This signifies higher levels of customer loyalty, increased revenue generation, and higher levels of customer satisfaction. Retention is a leading indicator of Product-Market Fit. Retention is often measured by its opposite, “churn”.
Revenue
The total amount of money that is generated before expenses.
Runway
The period during which the startup can remain in business, given the current level of funding. It is also imperative for the startup as it helps determine the budgeting, strategizing, forecasting, and fundraising throughout the startup lifecycle
SAFE Note
A type of convertible security. They are documents that early-stage companies use to help raise pre-seed or seed capital. This note acts as a legally binding promise to allow an investor to purchase a specified number of shares for an agreed-upon price at some point in the future. SAFE notes are quick and cheap to set up, so they are usually preferred for smaller rounds.
SAM (Serviceable Addressable Market)
A term used in business and marketing to describe the portion of the Total Addressable Market (TAM) that a company or business can realistically serve and target with its products or services. SAM represents the subset of the broader market that is both accessible and within the company’s reach. Understanding SAM is important for businesses to focus their marketing and sales efforts effectively.
SDK (software development toolkit)
a set of software tools and programs in one installable package. Also known as a devkit, that software companies provide to developers to build applications for specific platforms. SDKs tend to include building blocks, debuggers, and a code framework specific to an operating system (OS).
SEO (Search Engine Optimisation)
The process of improving a website to increase its visibility in search engines for relevant search queries, usually with a focus on user experience, crawlability, indexability and content relevance.
SLA (Service-Level Agreement)
A service-level agreement (SLA) sets the expectations between the service provider and the customer and describes the products or services to be delivered, the single point of contact for end-user problems, and the metrics by which the effectiveness of the process is monitored and approved.
SLG (Sales Led Growth)
Sales-led growth is a growth approach where the sales team and sales processes are the primary driver of customer acquisition, and is often used to generate quick or short-term revenue to aid in the growth of the business. Most commonly compared with Product Led Growth.
SOM (Serviceable Obtainable Market)
SOM is the portion of SAM that you can capture.
SPAC
Special purpose acquisition company. A SPAC raises capital through an initial public offering (IPO) for the purpose of acquiring an existing operating company.
SWOT Analysis
SWOT (strengths, weaknesses, opportunities, and threats) analysis is a framework used to evaluate a company’s competitive position and to develop strategic planning. SWOT analysis assesses internal and external factors, as well as current and future potential. A SWOT analysis is designed to facilitate a realistic, fact-based, data-driven look at the strengths and weaknesses of an organization, initiatives, or within its industry. The
SaaS (Software-as-a-Service)
SaaS is a software licensing and delivery model in which software is licensed on a subscription basis and is centrally hosted, usually cloud-based.
Scale-up
Once a startup reaches the growth phase, it is generally referred to as a scale-up. “A company who has an average annualized return of at least 20% in the past 3 years with at least 10 employees in the beginning of the period (OECD, 2007)”
Scaling
The ability for the startup to grow without being impeded. This often requires capital, planning, the right systems in place, partners, technology, and processes. Scaling usually happens after Product-Market Fit.
Scrum
An agile project management methodology that focuses on pivots, execution, and speed. It is designed to help small teams build complex products.
Secondary Market
The process where private company stock is sold to another private party (rather than selling directly to investors).
Securities
All types of equity or debt.
Seed Funding
Seed funding is the first official equity funding stage. It typically represents the first institutional money that a startup raises. Some VCs or Angels specialise in Seed funding, usually expecting a higher equity stake to account for the increased risk or early stage businesses.
Shareholders’ Agreement
A shareholders’ agreement is an agreement entered into between all or some of the shareholders in a startup. It regulates the relationship between the shareholders, the management of the company, ownership of the shares and the protection of the shareholders.
Smart Money
Value brought by an investor that goes beyond a check. This includes connections, time, and guidance, which is usually provided by the investor to the founders.
Soft Skills
Soft skills, often referred to as interpersonal or people skills, are non-technical skills that relate to how you interact with others, communicate, and work in a team. They are essential in both personal and professional settings. Here are some key soft skills: Communication Skills, Adaptability, Problem Solving, Critical Thinking, Creativity, Time Management, Leadership, Stress Management, Emotional Intelligence, Conflict Resolution, Networking, Customer Service, Negotiation, Presentation Skills
Solopreneur
An entrepreneur who starts and grows a business alone.
Stack (Tech or Marketing)
An expression originally used to describe all the technology services used to build and run one single application, now used more generically as a collection of technologies and tools used by a business to fulfil a certain function.
Startup
The term startup is generally used to refer to new companies in the initial stages of operations, usually characterised by high costs and limited revenue (funded either by the founders themselves are external investment).
Stealth Mode
A startup operating under the radar, keeping their value proposition / product a secret before an official launch so as not to alert competitors prematurely.
Success Fee
A compensation structure paid to a broker-dealer for successfully closing a transaction (i.e., providing funding via their network).
Sweat Equity
Awarding shares/equity in a startup to early employees or contractors in place of some (or all) of their salary.
TAM (Total Addressable Market)
TAM represents the entire potential market for a particular product or service. It includes every individual or organization that could possibly be a customer.
TAM is often considered the largest scope when assessing market potential.
TTL (Time To Live)
The number of months the venture can run on its existing cash before it has to shut down. It is calculated by dividing the company’s cash by the monthly expenses.
TTM (Time To Matket)
Time to market (TTM) is the total length of time it takes to bring a product from conception to market availability
Tag-Along Rights
Agreed stipulation stating that if a founder decides to sell their shares to a buyer, an existing investor can offer their shares to the buyer for the same amount.
Target Market
The group of consumers at which a product or service is aimed.
Technical Founder
The founder responsible for all the tech-related processes of the startup. They have hard technical skills (for example, PHP development). They use their technical ability to build the product and have a share of the overall profit.
Term Sheet
A Term sheet is a nonbinding agreement that shows the basic terms and conditions of an investment. The term sheet serves as a template and basis for more detailed, legally binding documents.
Traction
Evidence that users are willing to pay for your product or service. Traction represents progress or initial growth.
Trend Analysis
Trend analysis is a technique used to examine and predict movements of an item based on current and historical data. You can use trend analysis to improve your business using trend data to inform your decision-making
UI (User interface)
The design of an application, website, or software. In other words, anything the user can see and interact with.
USP (Unique Selling Proposition
The unique selling proposition. This is the one-of-a-kind benefit that the startup offers the customer.
UX (User Experience)
The extremely important process that the design teams use to create products that provide meaningful and relevant experiences to users.
Unicorn
A company (often in the tech or software sector) with a valuation of over US$1 billion.
Unit Economics
The financial metrics and analysis that focus on the direct revenues and costs associated with a particular business, product, or service, calculated on a per-unit basis. A “unit” in this context can represent any quantifiable item or transaction that generates revenue for the business.
VC (Venture Capitalist)
A venture capitalist (VC) is a private equity investor that provides capital to companies exhibiting high growth potential in exchange for an equity stake.
VR (Virtual Reality)
Virtual Reality (VR) is a computer-generated environment with scenes and objects that appear to be real, making the user feel they are immersed in their surroundings.
Validation
The process of determining whether your product is of interest to a given target market and if there is a demand for it.
Valley of Death
A period in the startup lifecycle that occurs after the startup launches a product but has not seen any revenue. This term is the result of plotting the shape of a company’s cash flow onto a graph. The valley is the location on the graph where the cash flow is at a very low point.
Valuation
The calculation of what the startup is worth.
Vesting
The schedule under which founders and employees must remain in the company before receiving their full share of the equity.
Waterfall
A methodology for startups that begins with the requirements gathering stage and then moves on to the design stage before development begins. Once the product has been created, it moves through various testing phases. It is a linear, sequential process.
Wireframe
A wireframe is a basic, two-dimensional visual representation of a web page, app interface, or product layout. Usually one of the first steps in rapid prototyping
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YC (Y Combinator)
Y Combinator. A startup accelerator that launched in March of 2005. Since then, it has launched more than 3,000 companies, including Airbnb, Coinbase, Cruise, DoorDash, Dropbox, Instacart, Quora, PagerDuty, Reddit, Stripe, and Twitch.
Zombie
A startup that looks promising yet has failed to gain traction and grow into a successful enterprise.
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