Disrupting disruption with disruptive disruptions since 2010.
The percentage of customers who cancel your service each month, also known as the number that keeps founders awake at 3 AM. A high churn rate means your product is a revolving door; a low one means customers haven't figured out how to find the cancel button yet.
A spreadsheet that tracks who owns what percentage of a company, growing increasingly depressing with each funding round as the founders' share shrinks like a wool sweater in a dryer. It's the scoreboard of startup capitalism.
The initial period before any stock options vest, typically one year, during which employees own exactly nothing and question all their life choices. It's called a cliff because if you leave before it, you fall off the edge of ownership into the abyss of having worked for below-market salary for nothing.
A loan that converts into equity during a future funding round, allowing investors and founders to avoid the uncomfortable conversation about what the company is actually worth. It's a financial IOU wrapped in optimism and legal jargon.
Customer Acquisition Cost—how much you spend in sales and marketing to land one customer. VCs compare this to lifetime value to determine if your business model is actually viable or just an expensive hobby.
A VC's strong belief in an investment thesis despite contrary evidence or market skepticism. The confidence to write a check when everyone else thinks you're insane—sometimes brilliance, often delusion.
The person you start a company with based on four hours of friendship and mutual delusion, who will become either your closest ally or your most expensive breakup. Dating is easier than finding a compatible co-founder.
Unsolicited outreach to investors or customers who have no idea who you are and probably don't care. The digital equivalent of knocking on strangers' doors, with similar success rates.
A term in VC fund agreements where once LPs get their initial investment back, GPs get an accelerated share of profits until their normal split is reached. Basically letting the manager 'catch up' to their 20% after paying back investors.
A venture capital fund owned and operated by a larger corporation to invest in strategically relevant startups. They bring money and potential acquisition interest, but everyone knows who they're really working for.
The startup world's euphemism for customers abandoning ship, measured as the rate at which subscribers cancel or stop using your service. It's the metric that keeps SaaS founders up at night, because acquiring new customers is expensive but losing existing ones is devastating. High churn is basically your business slowly bleeding out, but with spreadsheets.
A financing round where new investors impose unfavorable terms on existing shareholders who lack the power to block it. Essentially a hostile takeover by people already inside your building.
The formal demand from a general partner to limited partners to wire their committed funds, usually with 10-30 days notice and an implied "or else" hanging in the air. It's how venture funds move committed money from promised to deployed.
The time window (usually 3-5 years) during which a venture fund actively deploys capital into new investments, after which the GP is supposed to stop writing checks and focus on managing the existing portfolio. Think of it as the VC equivalent of last call at the bar.
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.
Reserved portion of an acquisition's proceeds specifically allocated to employees or specific shareholders, ensuring they benefit even if the waterfall would otherwise drown them. Exit sharing mandated by negotiation or generosity.
A provision allowing limited partners to reclaim previously distributed carried interest from GPs if later losses reduce overall fund returns. The nightmare scenario keeping fund managers up at night.
The VC's cut of investment profits, typically 20% of gains above a certain return threshold. How general partners get rich while limited partners provide the actual money—the ultimate performance fee.
A resilient company that survives on minimal resources and refuses to die despite market conditions that would kill competitors. They're scrappy, resourceful, and nearly impossible to eliminate.
The modern equivalent of passing the hat, except the hat is a slick website and you're asking thousands of strangers on the internet to fund your dream project, questionable invention, or potato salad. It's democratized investing meets collective optimism meets occasional fraud.
Special privileges allowing certain LPs to invest additional money directly into specific portfolio companies alongside the fund, usually with lower or no fees. The VIP backstage pass of venture investing.
Also called tag-along rights, these allow minority shareholders to join a sale transaction if majority holders are selling their shares. The 'if you're abandoning ship, I'm coming too' clause.
Past tense of churning, describing customers who've abandoned ship or accounts that have been excessively traded for commissions. In the startup world, it's the past tense of failure—these are the users who tried your product and decided literally anything else was better. When your investors ask about churned customers, it's never a fun conversation.
The unethical practice where brokers excessively trade in a client's account primarily to generate commissions rather than profits, essentially treating your portfolio like a butter-making operation. In SaaS, it refers to the rate at which customers cancel their subscriptions, making it the metric that haunts every startup founder's dreams. Either way, it's excessive activity that benefits someone other than you.