Disrupting disruption with disruptive disruptions since 2010.
Someone who gives you money in exchange for a piece of your company, future profits, or the thrill of watching their capital evaporate. They're either your best friend or worst nightmare, depending on whether your quarterly numbers are trending upward. In startup land, they're the people whose calls you always take.
Short for 'carried interest'—the percentage of fund profits that goes to VCs as performance compensation, typically 20%. It's why venture capitalists drive Teslas even when most of their portfolio is worthless.
The overwhelming wave of convertible notes and SAFEs that convert to equity during a priced round, often revealing a far more complex cap table than founders realized. The moment when chickens come home to roost, except the chickens are financial instruments.
A supplemental investment vehicle created alongside a main fund to accommodate additional capital from LPs or special investors, often for a specific deal or opportunity too large for the main fund. The VC version of ordering extra fries because one serving isn't enough.
The cultural expectation in startup ecosystems that successful entrepreneurs and investors should help newcomers, supposedly creating a virtuous cycle. In practice, it's often networking disguised as altruism.
A minimum funding round size (typically $1-2 million) that triggers the automatic conversion of SAFEs or convertible notes into equity. It's the threshold that separates real funding rounds from friends-and-family pocket change.
The practice where investors force a startup to create or expand the employee option pool before a funding round, effectively diluting founders rather than new investors. It's a clever way to pay employees with founder equity.
The speed at which a venture fund moves through its investment cycle, from raising capital to deploying it to returning capital to LPs. Faster isn't always better—ask anyone who inhaled their food and got heartburn.
When a startup prioritizes acquiring recognizable brand-name customers purely for credibility, even if those deals are unprofitable or unsustainable. It's the corporate equivalent of name-dropping at parties.
The privilege granted to preferred shareholders to convert their fancy preferred stock into common stock, typically exercised when they want to sell or when common stock becomes more valuable (rare but delightful). It's a one-way ticket that investors usually only take when they're confident they're not leaving money on the table.
Loans provided to venture-backed startups, typically secured by assets or future funding rounds. It's called 'non-dilutive capital,' which really means 'you'll dilute yourself later when you can't pay it back.'
A glamorized term for someone who decided that working for themselves would be less stressful than having a boss (spoiler: they were wrong). These brave or foolish souls start their own ventures, risking everything from savings to sanity in pursuit of the dream of being their own boss and working only 80 hours a week instead of 40. Every LinkedIn bio now includes this word because 'unemployed but optimistic' doesn't have the same ring to it.
An entrepreneur who returns to start another company after their previous venture was acquired or failed. They're either gluttons for punishment or genuinely addicted to the startup lifestyle.
When a VC aggressively increases their investment in a portfolio company across multiple rounds, betting their career on being right. Conviction investing taken to its logical extreme.
The exhaustion investors feel after reviewing hundreds of pitch decks that all blur together with the same buzzwords and hockey stick projections. It's why your 'revolutionary AI blockchain solution' makes their eyes glaze over.
The time required for an investment fund to return its original capital to LPs through exits and distributions. It's the VC equivalent of asking 'when do I get my money back?'
An investment opportunity sourced exclusively by one firm rather than through competitive process. The venture capital equivalent of finding $20 in your coat pocket—rare, lucky, and probably won't happen again.
The percentage of a company a VC aims to own to make an investment worthwhile relative to their fund size. It's why large funds often can't invest in your seed round—they need bigger slices.
The internal process VCs use to rank portfolio companies or investment opportunities from best to worst. A forced ranking system that ensures someone always gets picked last for dodgeball.
The act of reducing ownership percentage by issuing new shares, or what happens to founders' equity every time VCs open their checkbooks. In chemistry, it means adding solvent to weaken a solution; in startup world, it means your 50% stake just became 30% and you're supposed to smile because the company is now "worth more." The most expensive way to raise money without technically losing money.
A provision forcing minority shareholders to join a sale if majority shareholders approve it, preventing holdouts from blocking acquisitions. Democracy dies in shareholder agreements.
Raising capital from numerous small investors through online platforms, democratizing access to startup investment and the opportunity to lose money on early-stage companies. Kickstarter, but instead of getting a T-shirt, you get illiquid securities.
Restructuring a company's capital stack—often a euphemism for 'things went poorly and we need to reset everyone's expectations and ownership.' Can range from modest adjustments to burning everything down and starting over.
The percentage of a VC fund set aside for follow-on investments in existing portfolio companies. The math that determines whether your investor can actually support you in the next round or just awkwardly watch.