M&A Glossary

Browse 14 m&a terms defined in plain English, from the cultural dictionary of computing.

14 M&A Terms

Acqui-hire
Acqui-hire is a business strategy where a company is acquired primarily for its talented employees rather than its products, technology, or revenue. The...
Acquihire
An acquisition done primarily to hire a startup's team rather than to keep its product or revenue stream. The product may be shut down while the talent is...
Corporate Development
The function that handles strategic transactions such as acquisitions, investments, divestitures, and sometimes major partnerships. In larger startups,...
Deal Room
A secure shared repository of documents used during fundraising, diligence, or acquisition processes, often containing financials, contracts, and governance...
Double Trigger
An acceleration provision where employee equity vests early only if two conditions occur, typically a change of control plus termination without cause or a...
Drag Along
A contractual right allowing majority or specified shareholders to require minority holders to participate in a sale or transaction on the same terms....
Enterprise Value
A valuation measure that reflects the total value of a business, typically including equity value plus debt and minus cash. It is often used in acquisitions...
Exit
The event by which investors and founders convert their equity into cash — typically via acquisition (M&A), IPO, or secondary sale. The whole point of the VC...
Exit Event
A transaction or market event that provides liquidity to founders, employees, or investors, such as an acquisition, IPO, or major secondary sale. Exit events...
Holdback
A portion of purchase price or payment intentionally withheld until certain conditions are met, often to cover post-close claims or performance requirements....
IOI
Usually short for indication of interest, a preliminary non-binding statement that a buyer or investor may be interested in a transaction on broad terms. It...
Letter of Intent
A document stating serious intent to pursue a transaction or agreement on broad terms, often before final definitive contracts are signed. Letters of intent...
Management Buyout
A transaction where the existing management team acquires ownership of the business, often with outside financing. It is more common in later-stage or...
MBO
Usually shorthand for management buyout, where the management team acquires the business. In some operating contexts MBO can also mean management by...

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