churning

Definition

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.

Example Usage

Our customer churning rate hit 15% this quarter, which means we're losing clients faster than our sales team can learn to pronounce 'customer retention.'

Source: Business and finance terminology

Related Terms

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unicorn hunting

The venture capital strategy of seeking only investments with potential to return the entire fund, requiring massive exits. A portfolio approach that ignores solid doubles and triples in favor of swinging for nonexistent fences.

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co-investment rights

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.

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preference stack

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.

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Angel Investor

A wealthy individual who gives money to startups in exchange for equity and the warm feeling of watching their investment evaporate. They're called angels because they appear from heaven with cash and then watch helplessly as you fly straight into the ground.

🚀 Startup / VC

Intermediate

biotech

The magical realm where scientists play God with DNA and investors play roulette with their portfolios. Short for biotechnology, it's the industry that promises to cure cancer, extend your lifespan, and justify obscene R&D budgets—all while burning through cash faster than a lab incinerator. Whether it's CRISPR gene editing or synthetic biology, biotech is where biology meets business and hope meets hype.

🚀 Startup / VC

Advanced

Equity Dilution

The process by which your ownership percentage shrinks with each funding round until you own approximately as much of your company as you own of the Pacific Ocean. It's like splitting a pizza with more and more people, except you baked the pizza and now you get one olive.

🚀 Startup / VC

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tranche

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