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Glossary

Make sense of the language of startups and venture capital.

30 results

Tag Along

Tag along provides that if a majority shareholder decides to sell their stake in the company to a third party, minority shareholders have the right to sell their shares alongside the majority shareholder. This allows the other shareholders to join the sale of their shares, on the same terms requested by the majority sh

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TAM, SAM, and SOM

TAM, SAM, and SOM are concepts that refer to the market size a product or service can target.

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Term sheet

A term sheet is a non-binding document that is typically signed by a startup and an investor before signing an investment instrument (a convertible note, a SAFE, or an equity round).

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Valuation cap

A valuation cap is the maximum valuation a startup can reach under an investment instrument such as a SAFE, KISS, or convertible note.

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Venture Capital Fund

A Venture Capital fund, also known as a VC, is an investment fund whose investors are called LPs (limited partners) and whose management is led by a general partner (GP) tasked with investing in startups with a specific profile.

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Vesting, ESOP & Cliff

In the startup context, vesting is a period of time during which stock options granted to team members as part of their compensation are gradually released.

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