Disrupting disruption with disruptive disruptions since 2010.
A financing round where new investors impose harsh terms on existing shareholders who lack the votes to block it. It's democracy in action, if democracy meant 'whoever has the most money wins.'
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.
An anti-dilution mechanism that adjusts an investor's equity stake if the company raises money at a lower valuation, protecting them from down rounds. Full ratchet is brutal; weighted average is gentler.
A capital efficiency metric calculated as net burn divided by net new ARR, measuring how many dollars a company incincinerates to generate each dollar of recurring revenue. A burn multiple under 1.5x suggests efficiency; above 3x suggests a bonfire of investor capital.
A financing round raised at the same valuation as the previous round, suggesting a company has neither advanced nor declined—essentially treading water while burning cash. More diplomatically acceptable than a down round but almost as concerning to investors.
A funding round with complex terms beyond simple equity purchase—such as multiple share classes, ratchets, or unusual liquidation preferences. It's what happens when lawyers earn their retainers.
A startup valued at over $1 billion that has never undergone the reality check of going public or getting acquired. Their unicorn status exists purely in the fantasy land of private market valuations.
A pejorative term for investors who swoop in during distressed situations to extract maximum value at founders' expense. The same people who call themselves 'value investors' on their websites.
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.
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.
A provision forcing minority shareholders to join a sale if majority shareholders approve it, preventing holdouts from blocking acquisitions. Democracy dies in shareholder agreements.
Surrounded by a protective water-filled trench, which in business parlance describes a company with such strong competitive advantages that rivals can't touch them. Warren Buffett made this term famous by obsessing over companies with "economic moats" that defend market share like medieval fortifications. These days, everyone claims they have a moat, but most are more like puddles.
A structural competitive edge that's difficult or impossible for competitors to replicate, like proprietary technology, exclusive partnerships, or regulatory capture. What founders claim to have and what actually exists rarely overlap perfectly.
The magical period where startup founders burn through investor cash while "validating their business model," ostensibly nurturing their fledgling company from idea to viable business. Like hatching eggs, except the eggs cost millions of dollars and most of them produce nothing. Incubators and accelerators love this word because it makes burning money sound scientific and inevitable.
Making investment decisions at lightning speed with minimal diligence, named after Tiger Global's spray-and-pray approach during the 2020-2021 bubble. High velocity, low conviction, maximum FOMO.
The percentage of transaction value a platform extracts as revenue, revealing how much you're actually taxing your users for the privilege of using your service. Too high and users revolt; too low and investors revolt.
When a company or investor offers to buy shares from existing shareholders at a set price, providing liquidity without a full exit. A release valve for the equity pressure cooker.
The fancy business term for a proposal or offer, usually dressed up with adjectives like 'value' or 'unique' to make it sound more impressive than 'hey, wanna buy our stuff?' In startup pitch decks, the 'value proposition' is that one slide where founders explain why anyone should care about their idea, typically using a Venn diagram that doesn't quite make sense. A good proposition answers 'what's in it for me?' before the listener falls asleep.
The theoretical benefit of being first to market, used to justify rushing out half-baked products. History suggests fast-follower advantage is more valuable, but that doesn't sound as impressive in pitch decks.
A company culture claiming to make decisions based on data analysis rather than gut feeling, though which metrics get measured mysteriously align with what leadership already wanted to do. It's astrology for MBAs.
The magical property where your product becomes more valuable as more people use it—or what every social startup claims to have despite zero evidence. True network effects are rarer than honest user growth numbers.
Restructuring that gives early investors and employees liquidity without selling the company, like a pressure release valve for cap table tension. An exit without the exit.
A funding round at a lower valuation than the previous round, signaling either terrible execution or terrible timing. Triggers anti-dilution provisions and existential crises among founders.
A valuation metric calculated by dividing company valuation by annual revenue, popular in tech because it works even when profits are mythical. Allows investors to justify astronomical valuations by citing "industry standards."