Disrupting disruption with disruptive disruptions since 2010.
A funding round where the company valuation is explicitly set and shares are sold at a specific price per share, unlike convertible instruments that defer pricing. It's the grown-up version of fundraising, with actual valuations and everything.
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.
Additional money invested in a portfolio company after the initial round—either because things are going great and you want more ownership, or things are terrible and you're protecting your original investment. Hope and desperation look surprisingly similar.
Someone who receives equity for occasionally responding to emails and allowing you to use their name on your website. The advisor-to-impact ratio is the lowest in all of business, yet every startup has seven of them.
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.
A provision requiring existing investors to participate in future funding rounds or lose their special privileges. The venture capital equivalent of 'use it or lose it.'
A marketing term VCs use to describe their approach, supposedly indicating fair terms and supportive behavior. In practice, it often means 'we won't screw you quite as hard as the other guys.'
The amount of predictable revenue a SaaS company makes yearly—the metric that determines whether you're 'growth' or 'dead.'
The hierarchical order in which different classes of investors get paid during an exit, determined by liquidation preferences from multiple funding rounds. It's a legal game of Jenga where common stockholders usually lose.
The reduction in ownership percentage when additional shares are issued, especially painful in a down round where new shares are issued at a lower price. Watching your equity stake shrink while your company's value simultaneously decreases.
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 introduction to an investor or customer through a mutual connection, vastly more effective than cold outreach. The difference between your email being read and being instantly deleted by an EA.
A governing body that theoretically oversees your startup but mostly just attends meetings and questions your decisions, led by the investors who own significant stakes.
A provision in IPO underwriting allowing underwriters to sell additional shares if demand exceeds expectations, typically up to 15% more. Named after the first company to use it, because finance people hate straightforward names.
The time required for an investment fund to return its original capital to LPs through exits and distributions. It's the VC equivalent of asking 'when do I get my money back?'
The impossible choice between maintaining control of your company and maximizing its financial value, first articulated by Harvard's Noam Wasserman. You can be rich or you can be king, but probably not both.
A provision forcing minority shareholders to join a sale if majority shareholders approve it, preventing holdouts from blocking acquisitions. Democracy dies in shareholder agreements.
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.
A toxic funding structure where conversion price drops as stock price falls, creating a downward spiral that destroys equity value. The financial equivalent of quicksand—struggling only makes it worse.
A startup that a VC firm has invested in, now living in their collection like a Pokémon card. Each firm has dozens, knowing most will fail but hoping one becomes a legendary holographic Charizard.
A VC who claims they'll actively help your company through connections, advice, and support, as opposed to just wiring money. Reality: they'll make three intros, attend two board meetings, then ghost you unless you're a unicorn.
When investors, customers, or acquirers proactively reach out to a startup rather than being solicited. It's the entrepreneurial equivalent of being asked to the dance instead of doing the asking.
An entrepreneur who returns to start another company after their previous venture was acquired or failed. They're either gluttons for punishment or genuinely addicted to the startup lifestyle.
Contract provisions allowing investors to force the company to buy back their shares after a certain period, typically if there's no exit. A rarely exercised nuclear option that reminds founders who really has the power.