EQUITY: This is the portion of a company's capital that is provided by its shareholders. Equity is typically considered to be more risky than debt, as shareholders have a residual claim on a company's assets and earnings and are not entitled to a fixed return.

PRE-MONEY VALUATION: This is the value of a company before it raises additional capital through a funding round. The pre-money valuation is used as the starting point for negotiating the terms of the funding round, including the amount of capital to be raised and the ownership stakes of the investors.

POST-MONEY VALUATION: This is the value of a company after it has raised additional capital through a funding round. The post-money valuation is equal to the pre-money valuation plus the amount of capital raised in the funding round.

DILUTION: This is the decrease in the ownership stake of a company's existing shareholders that results from the issuance of new shares in a funding round. Dilution can be calculated by comparing the post-money valuation of a company to its pre-money valuation.

DATA ROOM: a secure virtual space where confidential documents and information are made available for review by potential investors or partners. These would include incorporation documents, legal structure, financial statements, tax returns and audit information, and details of any previous fundraising activities.

GO TO MARKET: the strategy and plan for bringing a product or service to market and making it available to customers.

LEAD INVESTOR: the main investor in a fundraising round, the one who takes the lead role in coordinating the investment round and establishing the key terms.

ARR: annual recurring revenue, a measure of the amount of revenue that a company can expect to receive on a regular basis in a given year.

MRR: monthly recurring revenue, a measure of the amount of revenue that a company can expect to receive on a regular basis each month.

CAC: customer acquisition cost, the amount of money that a company spends to acquire a new customer.

LTV: lifetime value, a measure of the total value that a customer is expected to generate for a company over the course of their relationship with the company.

NDR: net dollar retention, a measure of the percentage of revenue that a company retains from its existing customer base over a given period of time.

MAU: monthly active users, a measure of the number of unique users who engage with a product or service on a monthly basis.

DAU: daily active users, a measure of the number of unique users who engage with a product or service on a daily basis.

CHURN: the rate at which customers stop using a product or service, often expressed as a percentage.

BURN RATE: the rate at which a company is spending its cash reserves, often expressed as the amount of money spent per month.

RUNWAY: the amount of time that a company has before it runs out of cash, based on its current burn rate.
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MARKET SIZE: the total number of potential customers for a product or service, or the total amount of revenue that can be generated from selling the product or service.

MARKET GROWTH RATE: the rate at which the market for a product or service is expanding, typically measured as the percentage increase in market size over a given period of time.

TAM: total addressable market, the total potential market for a product or service.

SAM: the subset of the total addressable market (TAM) that a company is capable of serving, based on factors such as its geographical reach, the capabilities of its products or services, and any legal or regulatory constraints.

SOM: the portion of the serviceable addressable market (SAM) that a company is able to capture, based on factors such as its competitive advantage, its marketing and sales efforts, and the preferences of its target customers.
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FUTURE CASH FLOWS: The standard and most traditional method of valuing a company based on the cash it is expected to generate in the future.

COST OF GOODS SOLD: This is the direct costs associated with the production of a company's goods or services. This includes the cost of materials and labor directly used in the production process.

D&A: This stands for Depreciation and Amortization. Depreciation is the process of allocating the cost of a long-term asset, such as property or equipment, over its useful life. Amortization is the process of gradually reducing the value of an intangible asset, such as a patent or trademark, over its useful life.

EBITDA: This stands for Earnings Before Interest, Taxes, Depreciation, and Amortization. EBITDA is a measure of a company's operating performance that excludes the effects of interest, taxes, depreciation, and amortization on its earnings. EBITDA is often used as a proxy for a company's cash flow from operations.

DEBT AT THE END OF THE YEAR: This is the amount of debt that a company has outstanding at the end of a given year. This can include both long-term and short-term debt, such as loans and bonds.

SALARIES: This is the total amount of money that a company pays to its employees in the form of wages and salaries. This can include regular pay as well as bonuses and other forms of compensation.

RECEIVABLES: This is the amount of money that a company is owed by its customers for goods or services that have been delivered but not yet paid for.

REVENUES: This is the total amount of money that a company earns from its normal business operations. This can include sales of goods or services, as well as other forms of income, such as interest or rental income.

TAXES: This is the amount of money that a company is required to pay to the government in the form of various taxes, such as income tax or sales tax.

CAPITAL EXPENDITURE: This is the amount of money that a company spends on long-term assets, such as property or equipment. These expenditures are typically made to improve the company's operations or to expand its business.

PAYABLES: This is the amount of money that a company owes to its suppliers or other creditors for goods or services that have been received but not yet paid for.

OTHER OPERATING COSTS: This is the collective term for all the other costs that a company incurs as part of its normal business operations, such as rent, utilities, and insurance. These costs are typically considered to be indirect costs and are not directly associated with the production of goods or services.

INTEREST ON DEBT: This is the amount of money that a company must pay to its lenders in the form of interest on its outstanding debt. This can include interest on loans, bonds, and other forms of borrowing.

INVENTORY: This is the total value of a company's raw materials, finished goods, and work in progress. Inventory is typically considered to be a current asset, as it can be sold or converted into cash within a relatively short period of time.

COST OF CAPITAL: This is the minimum rate of return that a company must earn on its investments in order to satisfy its creditors and investors. The cost of capital is typically made up of the cost of debt and the cost of equity, and it reflects the level of risk associated with a company's operations.

WEIGHTED AVERAGE COST OF CAPITAL (WACC): This is a calculation that estimates a company's overall cost of capital by taking into account the relative weights of its different sources of capital. The WACC is typically used as a discount rate when valuing a company's future cash flows.

RISK-FREE RATE: This is the return that an investor can expect to earn on an investment with no risk of default or loss. The risk-free rate is typically represented by the yield on a long-term government bond, such as the U.S. Treasury bond.

INDUSTRY BETA: This is a measure of the volatility of a company's stock price relative to the overall market. A company with a high industry beta is considered to be more risky than a company with a low industry beta.

STARTUP SURVIVAL RATE: This is the percentage of startups that are still in business after a certain period of time. Startup survival rates can vary depending on the industry and the type of business, but typically only a small percentage of startups are able to survive and grow in the long term.

DISCOUNT RATE: This is the rate of return that is used to discount future cash flows to their present value. The discount rate is typically based on the cost of capital and reflects the level of risk associated with the cash flows.

ILLIQUIDITY DISCOUNT: This is the reduction in value that is applied to an asset due to its lack of liquidity. Illiquid assets, such as real estate or private company stock, are typically worth less than liquid assets, such as publicly traded stocks, because they are difficult to sell quickly without incurring a significant loss.

FREE CASH FLOWS TO EQUITY: This is the cash that is available to a company's shareholders after taking into account the cash flows from operations, capital expenditures, and debt payments. Free cash flows to equity can be used to pay dividends, repurchase shares, or invest in new opportunities.

MARKET RISK PREMIUM: This is the additional return that investors expect to earn on an investment over and above the risk-free rate. The market risk premium reflects the compensation that investors require for taking on additional risk by investing in the market rather than in a risk-free asset.

SAFE NOTE: This stands for Simple Agreement for Future Equity. A SAFE note is a type of investment instrument that is similar to a convertible note, but it does not accrue interest or have a maturity date. Instead, the investor receives a right to receive equity in the company at a future date, typically upon the occurrence of a defined trigger event, such as the completion of a future funding round or the achievement of certain milestones.

PRE-MONEY SAFE: This is a SAFE note that is issued before a company raises additional capital through a funding round. The pre-money SAFE converts into equity at a valuation determined in the next round of qualified financing.

POST-MONEY SAFE: A post money SAFE note allows an investor to lock in a certain percentage of the company that they will own at the next round of qualified financing. It gives investors more certainty about their ownership following that round.

CONVERTIBLE NOTE: This is a type of investment instrument that is issued as a debt security but is intended to convert into equity at a future date. Convertible notes typically accrue interest and have a maturity date, at which point they must either be repaid or converted into equity.

QUALIFIED FINANCING: Most commonly a Seed or Series A round, ‘qualified financing’ refers to equity related events which trigger the conversion of a convertible note SAFE note to equity.

CAP: This is the maximum valuation at which a convertible note or SAFE will convert into equity. If the company's valuation exceeds the convertible note cap at the time of conversion, the investor will receive a discount on the price of the equity.

DISCOUNT: This is the discount on valuation at which a convertible note or SAFE will convert into equity. The investor will receive a set discount on the price of the equity at the time their investment converts.

CONVERTIBLE DEBT: This is another term for a convertible note. Convertible debt refers to the fact that the investment instrument is issued as a debt security, but it has the potential to convert into equity at a future date.

LIQUIDITY PREFERENCES: These are the terms and conditions that are included in a convertible note or SAFE that determine how the investment will be treated in the event of a liquidity event, such as an acquisition or IPO. Liquidity preferences can include non-participating, participating, and ratchet provisions, which determine the amount of proceeds that the investor is entitled to receive upon a liquidity event.

NON-PARTICIPATING LIQUIDITY PREFERENCES: These are liquidity preferences that means that in a liquidity event that investor gets paid out first, either with a multiple of their initial investment (typically 1x), or converting that investment into equity first according to their ownership.

PARTICIPATING LIQUIDITY PREFERENCES: Participating liquidity preferences work the same way as non-participating liquidity preferences, except it is not a choice of one or the other: investors get their initial investment back (again, as a multiple, typically 1x) on top of the value of the associated amount of equity.

RATCHET: This is a type of liquidity preference that provides the investor with additional equity upon a liquidity event if the proceeds from the event are less than a certain amount. The ratchet ensures that the investor is not diluted further, even if the company's valuation decreases.

FULL RATCHET: This is a type of ratchet that provides the investor with the full value of their initial investment in the form of additional equity upon a liquidity event. A full ratchet ensures that the investor's ownership stake in the company remains constant, regardless of the company's valuation at the time of the event.

PRO-RATA: This is a provision that allows investors to maintain their ownership stake in a company by purchasing additional shares in future funding rounds on a pro-rata basis. A pro-rata provision allows the investor to maintain their proportional ownership in the company, even as the company raises additional capital and dilutes the stakes of other shareholders.

DRAG-ALONG RIGHTS: a provision in a shareholders' agreement that gives the majority shareholder the right to force the minority shareholders to join in the sale of the company.