The Art of Startup Fundraising

Glossary

In this handy glossary of terms you'll find a list of key definitions that you should familiarize yourself with before and during your journey as a startup founder looking for investment.

angel investor:

An investor primarily involved in early startup investment. (Often a one-off investment made by family or friends to help a startup founder get a project up and running, or a cash injection to help a business weather a difficult period.)

antidilution protection:

A clause in a contract that protects some investors from their equity or shares' dilution when other investors buy stock in a company. This is often applied when shares in a company are sold at a value less than the amount paid originally by existing investors.

board of advisors:

A group of individuals who offer advice to the management of a company. This is an informal relationship and not legally binding, but can provide valuable strategic policies.

board of directors:

A group of individuals who are appointed to collectively appraise and oversee all company activities. This is a formal arrangement and therefore the mandates made by directors must be carried out.

business plan:

A systematic breakdown of how a business will develop. This clearly states any expenses needed to achieve specific goals within a given timeframe.

Bonds:

A form of debt investment. In this case an investor offers a loan to a business in return for bonds equaling that value. These can then be cashed in after an agreed-upon ...