Glossary

A

Accountability Synonymous with responsibility. Every decision must be able to be justified based on sound judgment and ethical principles. Negative consequences must be expected by decision makers whose decisions result in dire outcomes.

ACRE Chart An effective way to determine how to secure funds on the most favorable terms given stated company and operational objectives. The letters A-C-R-E stand for availability, cost, risk, and effect. They represent the criteria to be assessed to determine the most efficient finance option. The different funding options are listed on the vertical axis. The various criteria to be assessed are listed on the horizontal axis.

Adjusted RED The raw rating of equity dilution (RED) score adjusted to account for established future uncertainties in the capital structure of a business. An established capital structure uncertainty exists when there is a possibility that further equity dilution can occur without the necessity of executing a funding round. Such an occurrence is primarily possible due to the existence of convertible securities.

Angel Investor An individual willing to make high-risk investments in early-stage ventures. Typically these individuals have had successful entrepreneurial experience in the areas of investment they consider.

Antidilution The purpose of an antidilution clause is to protect counterparties from dilution of their equity in the event of future equity issuance. An increase in the total amount of outstanding ...

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