Startup Jargon Jungle
The Guide to Startup and Investment Terms
01
Accelerator
A program that provides startups with mentorship, office space, and funding to accelerate their growth over a short period. Think of it as a rocket booster for your business — just without the need for NASA approval.
02
Angel Investor
An affluent individual who provides capital to startups in exchange for ownership equity or convertible debt.
They might not have wings, but they sure can make your dreams fly.
03
Bootstrapping
Building a company from the ground up with personal savings and revenues from the business, without external funding. It’s like pulling yourself up by your shoelaces—if your shoes were made of gold.
04
Burn Rate
The rate at which a startup spends its cash reserves before generating positive cash flow from operations. Basically, it’s how fast your money goes up in flames —
like roasting marshmallows, but less tasty.
05
Cap Table
A spreadsheet or table that shows the ownership stakes in a company, including equity shares, convertible notes, and option pools. It’s like a family tree, but with more drama and fewer reunions.
06
Crowdfunding
Raising small amounts of money from a large number of people, typically via the internet, to fund a new business venture. Picture a digital bake sale, but instead of cookies, you’re selling your wildest dreams.
07
Exit Strategy
A plan for how an entrepreneur intends to exit their investment in a company, typically through an acquisition, merger, or IPO. It’s the entrepreneurial equivalent of “leaving the party while it’s still fun.”
08
Incubator
An organization designed to help startups succeed by providing workspace, mentorship, and sometimes funding. Think of it as a cozy nest where your business
idea can hatch and learn to fly.
09
Initial Public Offering (IPO)
The process through which a private company offers shares to the public for the first time. It’s like a debutante ball for your business—time to put on your best suit and dance with Wall Street.
10
Pitch Deck
A presentation used by startups to pitch their business idea to potential investors. It’s like a PowerPoint on steroids, aiming to impress more than just your high school history teacher.
11
Pivot
A significant change in a startup’s business model or product strategy, often based on market feedback. It’s like a professional dance move—if the dance floor were made of shifting sands.
12
Seed Funding
The initial capital used to start a business, often coming from the founders, friends, family, and angel investors. It’s planting the seed of your idea—hopefully in fertile soil, not in the middle of a desert.
13
Series A, B, C Funding
Subsequent rounds of funding after the initial seed stage, each representing a new phase of growth and investment. Think of it as leveling up in a video game — new challenges, new rewards, and hopefully no bosses.
14
Term Sheet
A non-binding agreement that outlines the basic terms and conditions under which an investment will be made. It’s like the prenup for your business marriage — no wedding bells, but plenty of fine print
15
Unicorn
A privately held startup valued at over $1 billion. It’s not a mythical creature—it’s real, rare, and more valuable than a stable full of racehorses.
16
Valuation
The process of determining the current worth of a company, typically before raising investment. It’s like getting your house appraised, but instead of bricks and
mortar, it’s dreams and spreadsheets.
17
Venture Capital
Financial capital provided to early-stage, high-potential growth companies in exchange for equity. Think of it as a dragon hoarding treasure—except the dragon wants you to use the gold to build another dragon.
18
Runway
The amount of time a startup can continue to operate before it needs additional funding, based on its current burn rate. It’s like a countdown clock on your business rocket — hope you have enough fuel to reach orbit!
19
Scalability
The potential of a startup to grow rapidly and manage increased demand without compromising performance or losing revenue. It’s the business version of Hulk’s
superpower—grow bigger and stronger without tearing your pants.
20
Due Diligence
The comprehensive appraisal of a business undertaken by a prospective investor, typically involving an audit of financial, legal, and operational aspects. It’s like detective work, but instead of solving crimes, you’re uncovering financial skeletons in the closet.
