Startup Terms Glossary

Freemium - Business model in which a basic version of a product or service is offered for free, while premium features are available for a fee.

Soonicorn - Startups that are expected to achieve $1 Billion valuation in near future.

Sweat Equity - Equity granted to mentos and advisors against their valuable time and expertise in startup.

SAFE (Simple Agreement for Future Equity) - A type of financial instrument used by startups to raise capital without issuing stock at the time of the investment. Nevertheless, in a subsequent round of financing or acquisition SAFE note converts into equity in the startup at a discount to the price per share of the new round.

Donkey - Those over-valued startups that secures funding based on few metrics only and have deficiencies and shortcoming in other functions of business.

Bear - Startup founders that are not interested in VC funding and makes huge business independently.

Bootstrapping - Starting and growing a business without external investment, relying on personal savings and Friends & Family.

Scalability - The ability of a company to grow and expand its business operations without a proportionate increase in costs.

Dilution - The reduction in the ownership percentage of a company's shareholders that occurs when the company issues new equity.

Seed round - The first round of financing for a startup, typically from friends, family and angel investors.

Cap Table - Stakeholders of organization and percentage ownership they have.

Camel - These companies can survive for longer time with limited funding owing to its reserves and strategy.

Unicorn - Startups which has achieved $1 billion private valuation.

Burn rate - The rate at which a company is spending its capital to scale and grow especially during the early phase.

Zebra - Companies which can operate their businesses profitably by solving social causes.

Convertible Note - Equity subscribed to based on future round of funding and matching the valuation.

Dragon - Rare startups that raises more than $1 Billion in a single funding round.

Niche - Specific, demographic focused market or target audience.

Key Performance Indicator (KPI) - Metric used to measure the success of a business or specific aspect of a business.

Gross Merchandise Value (GMV) - Measures cumulative MRP of goods sold.

GTM - Go To Market strategy adopted by organizations to create awareness, distribution, marketing and revenue of a newly launched product.

EBITDA - Earning before interest, taxes, depreciation, and amortization for realizing company's core growth and profit.

Series A - The first round of venture capital financing that is typically used to scale the business and prepare it for future growth. Hence, subsequent rounds are termed as Series B, C, ... so on.

Pivot - Changing business directions that involves changing the target market, the product or service offering, the business model, or any other aspect of the company to better align the business with customer needs & position the company for more sustainable growth.

Run Rate - Predicted annual revenue of business based on present monthly sales and growth in financial year.

Traffic - Indicates rate of products/services usage by customers on applications or website on a daily, monthly or yearly basis.

Value Proposition - Defines the value and benefits offered to customer through range of products or services.

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