Founders Fund

Definition

A venture capital firm explicitly run by founders (like Peter Thiel's firm) with the theory that people who've built companies make better investors; the evidence is mixed.

Example Usage

We're pitching to a Founders Fund-style VC tomorrow, which is great because they understand our pain but also concerning because founders are notoriously terrible investors.

Origin

Concept popularized by Peter Thiel; formalized as a VC category in the early 2000s

Fun Fact

Founders Fund invested $500K in Palantir at the seed stage; Palantir is now worth $30B, making it one of the best VC returns ever

Source: Venture capital organizational terminology

Related Terms

Intermediate

off-ramp

A business and startup jargon term describing an exit strategy or way to gracefully exit a situation, deal, or initiative. Think of it as the metaphorical highway exit when the original plan isn't working out.

🚀 Startup / VC

Intermediate

diluting

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.

🚀 Startup / VC

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Accrued Interest

Interest on convertible notes that automatically converts to equity at future rounds, making the note holders richer for waiting.

🚀 Startup / VC

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vesting cliff

The sadistic waiting period before any of your stock options actually belong to you, typically one year. It's designed to prevent you from taking the job and immediately quitting, essentially holding your compensation hostage for good behavior.

🚀 Startup / VC

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Go-to-Market

The strategy for launching a product to customers, which in startup land typically involves a 90-slide deck, a Slack channel called launch-war-room, and a blog post nobody reads. It's called go-to-market because go-to-three-customers-who-are-your-friends doesn't sound as impressive.

🚀 Startup / VC

Intermediate

Series A / Series B / Series C

A funding round naming scheme that allows investors to pretend they understand what stage a company is at. Each round requires the company to promise even more revolutionary metrics.

🚀 Startup / VC

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