Investors Glossary

Browse 66 investors terms defined in plain English, from the cultural dictionary of computing.

66 Investors Terms

Anchor Investor
A major investor whose early commitment helps validate a financing round and attract additional participants. Anchor investors often influence signaling,...
Angel Round
An early financing round primarily funded by angel investors, usually before or instead of institutional venture capital. It often supports initial product...
Angel Syndicate
A group of angel investors who coordinate to invest together in startups, often through a lead investor or shared vehicle. Syndicates give founders access to...
Anti-Dilution
A protective term that adjusts an investor's ownership economics if later shares are sold at a lower valuation, reducing the impact of dilution from a down...
Benchmark Capital
A well-known venture capital firm frequently referenced in startup financing, company-building, and Silicon Valley history. Mentioning it often signals...
Board Observer
Someone allowed to attend board meetings and receive materials without holding a formal board seat or voting authority. Observer rights are common in venture...
Board Seat
A formal position on a company's board of directors, usually carrying governance rights, meeting participation, and influence over major decisions. Board seats...
Capital Call
A request from a fund to its limited partners to provide committed capital so the fund can make investments or cover obligations. Founders encounter the term...
Closed Round
A financing round that has formally completed, with documents signed and funds committed or wired. Saying a round is closed usually matters more than saying it...
Co-Investment
An investment made alongside a lead fund or main financing vehicle into the same deal, often by existing backers, LPs, or strategic participants. It allows...
Corporate Venture Capital
Venture investing done by established corporations rather than independent VC firms, often for both financial return and strategic access. Corporate venture...
CVC
Short for corporate venture capital, referring to startup investment activity by established corporations. CVC can provide strategic distribution and...
Deal Flow
The stream of potential investment or transaction opportunities coming into a fund, acquirer, or business-development team. Strong deal flow is a major source...
Dry Powder
Cash reserves available for future deployment, often used for investors who still have capital to invest or companies that preserved spending capacity. The...
Evergreen Fund
An investment fund without a fixed end date, allowing capital to stay deployed and recycled over longer periods instead of following a standard fund lifecycle....
Exit Strategy
The plan or likely path by which investors and founders may eventually realize returns, such as acquisition, IPO, or sustained cash-generating independence. A...
External Funding
Capital brought into the company from outside sources such as investors, lenders, or grant makers rather than from internal revenue or founder savings. The...
Family Office
A private investment organization that manages wealth for one family or a small set of families, sometimes participating in startup investing directly. Family...
Funding Round
A discrete event in which a startup raises capital from investors under a defined set of terms. Funding rounds mark shifts in ownership, valuation, and company...
Fund of Funds
An investment fund that invests in other funds rather than directly into operating companies. In venture ecosystems, fund of funds capital often sits behind...
Generalist VC
A venture investor or firm that invests across many sectors instead of specializing deeply in a single domain. Generalist VCs often compete on judgment,...
General Partner
A senior manager of an investment fund who makes decisions on behalf of the fund and is responsible for deploying capital and managing the portfolio. In...
Growth Equity
Investment in relatively mature private companies with meaningful revenue and growth, typically later than venture capital but earlier than full buyout...
Guidance
Management's communicated expectation for future business performance, such as revenue, margin, or growth, typically given to investors, boards, or public...
High-Growth
Describing a company or market expanding at a notably fast rate, often attracting investor attention and operational strain at the same time. High-growth...
Hold Period
The length of time an investor expects to hold an investment before exit or liquidity. Hold periods matter because different capital sources tolerate different...
House Money
Capital or gains treated psychologically as easier to risk because they are seen as winnings or surplus rather than hard-earned principal. In startup and...
Impact Investing
Investing with the intention of generating measurable social or environmental impact alongside financial return. In startup contexts it often appears in...
Information Rights
Contractual rights allowing investors or certain shareholders to receive financial statements, reports, and other company information on an ongoing basis....
Inside Round
A financing round led primarily by existing investors rather than new outside firms. Inside rounds can signal strong internal conviction or difficulty...
Investment Committee
The group within an investment firm that reviews and approves potential deals before capital is committed. Getting through the investment committee is often...
Investment Memo
A written document summarizing the case for or against an investment, including market, product, team, risks, and expected returns. Investment memos force...
Investment Thesis
The core reasoning behind why an investment should generate returns, including beliefs about market trends, team fit, defensibility, and timing. Strong...
Lead Investor
The investor who anchors a financing round, usually setting key terms, taking the largest check, and often taking a board seat. Getting a strong lead investor...
Limited Partner
An investor in a fund who provides capital but does not manage the fund's day-to-day investment decisions. Limited partners sit behind venture firms as the...
Liquidation Preference
A financing term that determines how much investors receive before common shareholders when the company is sold or liquidated. The structure can materially...
Liquidity Event
An event such as an IPO, acquisition, or significant secondary sale that allows shareholders to convert part of their paper ownership into cash. Liquidity...
LP
Short for limited partner, meaning an investor who supplies capital to a fund without managing its day-to-day investments. LPs are the ultimate backers behind...
Market Opportunity
The addressable potential for a company to create value in a particular market, considering demand, willingness to pay, timing, and competitive dynamics. A...
Market Size
The scale of the demand or revenue opportunity available in a market, often framed through TAM, SAM, or other segmentation models. Market size is central to...
Participation Rights
Rights allowing investors to participate in future financings to maintain or increase their ownership, and in some contexts referring to participating...
Portfolio
A collection of investments, products, or business lines managed together. In venture it refers to the fund's invested companies; in operating businesses it...
Portfolio Company
A company that has received investment from a venture fund, private equity firm, or similar investor and is therefore part of that investor's portfolio. The...
Preferred Stock
A class of shares that gives investors special rights relative to common stock, such as liquidation preference, anti-dilution protections, or other...
Private Equity
Investment in privately held companies, often through larger control-oriented transactions than typical venture capital. In startup discussion, private equity...
Pro Rata
In proportion to an existing ownership stake or allocation. In venture financings, pro rata rights let investors buy enough in later rounds to maintain their...
Raise
To secure external capital from investors or other sources for the company. In founder speech, 'raising' usually implies the entire process of pitching,...
Shark Tank
The television show where founders pitch businesses to investors on-air, now widely referenced in startup culture as shorthand for performative investor...
Smart Money
Capital from investors who are expected to provide not just money but also expertise, network access, recruiting help, or market credibility. Founders use the...
Special Purpose Vehicle
A separate legal entity created for a specific investment, transaction, or asset-holding purpose. In startup fundraising, special purpose vehicles are often...
SPV
Short for special purpose vehicle, a separate entity used to hold an investment or structure a transaction. SPVs are common in venture syndicates and secondary...
Startup Ecosystem
The network of founders, investors, accelerators, service providers, employees, events, and institutions that support startup creation in a region or sector. A...
Startup Funding
The capital a startup raises or secures to build product, hire people, and extend runway while it grows. It can come from founders, angels, venture funds,...
Startup Valuation
The estimated value assigned to a startup in fundraising or transaction contexts, often influenced by growth potential, comparables, market conditions, and...
Strategic Investor
An investor who brings strategic value beyond capital, such as distribution, industry credibility, technical partnership, or channel access. Strategic...
Syndicate
A group of investors participating together in a deal, often coordinated by a lead who assembles the round. Syndicates are common in angel investing and...
Syndicate Lead
The investor who organizes a syndicate, sets the terms for other participants, and often serves as the central point of trust and coordination. In angel...
Tier 1 VC
An informal label for a venture firm perceived as especially prestigious, influential, or capable of helping portfolio companies beyond capital. The term is...
Traction
Evidence that a company is gaining real momentum, such as revenue growth, usage, retention, customer demand, or other signs the market is pulling the product....
Valuation
The value assigned to a company in a financing, transaction, or internal analysis. In startups, valuation reflects not just current performance but also...
Value Add
The practical benefit provided beyond the core transaction, such as expertise, introductions, support, or extra capability. In startup conversations, 'value...
VC
Short for venture capital or venture capitalist, depending on context. In startup speech, 'VC' can mean the asset class, the firm, or the individual investor...
VC Fund
A pooled investment vehicle that deploys capital into startups in exchange for ownership, usually with a portfolio approach and a defined investment strategy....
VC Portfolio
The set of companies backed by a venture firm or fund. The composition of a VC portfolio shapes the firm's brand, expertise, and power-law return profile.
Venture Capital
A form of private investment capital used to back startups and other high-growth private companies in exchange for equity. Venture capital expects a small...
Venture Partner
A part-time or non-permanent senior contributor at a venture firm who helps with sourcing, diligence, company support, or thesis work without being a full...

Related Topics