skin in the game

Beginner 🚀 Startup / VC

Definition

Having personal capital at risk in an investment or venture, theoretically aligning interests between founders and investors. It's the 'put your money where your mouth is' principle, except everyone's mouth is usually writing checks their bank account can't cash.

Example Usage

The VC wanted to see skin in the game, so I maxed out three credit cards and took a second mortgage to invest in my own seed round.

Origin

Financial markets terminology, popularized by Warren Buffett and later Nassim Taleb's book 'Skin in the Game' (2018).

Fun Fact

Founders always have catastrophic amounts of skin in the game through opportunity cost and foregone salary, though VCs still want to see actual cash investment too.

Source: Investment and risk management terminology

Related Terms

Intermediate

TAM

Total Addressable Market -- the theoretical maximum revenue if you sold your product to every possible customer on Earth, including people who don't want it, can't afford it, and live in places without internet. It's the biggest number in every pitch deck and the most fictional.

🚀 Startup / VC
Beginner

bootstrapped

Building a company with personal savings, credit cards, and stress ulcers instead of venture capital—either a badge of honor or an excuse for slow growth, depending on your exit results. It's entrepreneurship on hard mode.

🚀 Startup / VC
Intermediate

memo culture

The internal practice at VC firms of writing detailed investment memos that analyze potential deals. Where partners commit their hottest takes to writing so they can be mocked later when wrong.

🚀 Startup / VC
Intermediate

venturer

A fancy term for someone who invests in or undertakes risky business ventures, particularly in the startup ecosystem where optimism meets capitalism. These bold souls throw money and energy at unproven business ideas, hoping to strike gold before bankruptcy strikes them. It's like being an explorer, except instead of discovering new lands, you're discovering new ways to burn through Series A funding.

🚀 Startup / VC
Intermediate

vested

The magical moment when stock options or retirement contributions officially become yours to keep, transforming from corporate dangling carrot into actual ownership. It's the golden handcuffs' lock clicking shut, ensuring you'll think twice before rage-quitting. The startup world's version of 'you must be this loyal to ride this rocket ship.'

🚀 Startup / VC
Intermediate

deployment velocity

The speed at which a venture fund invests its committed capital, often scrutinized as a metric of both deal flow quality and fund discipline. Too slow suggests weak deal flow; too fast suggests poor judgment and FOMO.

🚀 Startup / VC

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