409A Valuation: A third party valuation of a company’s common stock. Generally used by startup companies to help determine the exercise price for company stock options.

ARPU: Average Revenue Per User

AOV: Average Order Value.

ARRG Ratio: Average Recurring Revenue (ARR) / Growth Rate.

Accelerator: A program that provides the mentorship and capital necessary to accelerate the growth and success of young startups. Typically, the program will provide some capital and in exchange will take an equity stake in the startup.

Accredited Investor: An individual or institution that meets certain wealth criteria (as defined regulators), and is therefore deemed to be sophisticated enough to participate in private, non-public investments. There are many ways to qualify, including if you are:- An individual that has had income in excess of $200,000 per year in each of the prior two years, and reasonably expects the same for the current year- A spousal couple that has had income in excess of $300,000 per year in each of the prior two years, and reasonably expects the same for the current year- An individual or spousal couple with over $1,000,000 in net worth (excluding the value of their primary residence)- A charitable organization, corporation, partnership or trust with assets in excess of $5,000,000. For most up to date definitions see www.irs.gov.

Allocation: The size of the round that is set aside for a specific investor (can be a fund or group of investors), usually communicated in a dollar amount.

Anchor investor: First investor in a fund; can be also referred to as the lead investor.

ARR: Annual revenue run rate; the revenue for the last month multiplied times 12 months as an estimate of the total revenue rate for the year.

Angel Investor: Wealthy individuals that invest in startups in their early stages of development or seed round of fundraising. Due to the inherent risk of loss of capital or significant dilution in subsequent fundraising, angel investors typically pursue investments with returns that they believe may have the potential to return multiples of the initial investment.

Anti-dilution Clause: Contractual clause that protects an investor from having their investment as a percentage of ownership significantly reduced in subsequent rounds of fundraising. Technically the provision increases the number of shares of Common Stock issuable upon conversion of a convertible security or upon exercise of a warrant or option upon the occurrence of specified events, usually the issuance of more shares for a low price.

Blended Preferences: When all classes of preferred stock have equal payment rights in the event of a liquidation

Bootstrapping: Business strategy by which a startup self-finances, eliminating the need for seed or angel investment. Typically achieved through lean operation and a product that generates revenue early in the companies life cycle.

Bridge Loan | Financing: A loan given to a startup by investors that serves to fund the company until the next round of financing. The bridge loan is usually converted into equity at the next equity financing of the company.

Burn Rate: Rate at which a company consumes cash to cover expenses. Typically expressed monthly or weekly. Usually applied to a company with no revenues, to give a metric of financial health and fundraising needs. A company with a low burn rate can theoretically operate longer without new injection of capital.

Capital Call: When a fund makes an investment and messages the LPs to put capital into the fund account to invest in the portfolio companies.

Cap Table: An official document that shows the capital structure of a company, including the specific ownership level by investor. Generally used to view the percentage ownership that each investor or employee owns of a certain company. For a great tool, check out http://captable.io/.

Carried Interest: The share of generated profits that an investment manager is entitled to keep as compensation. Typical venture capital fund incentive fees range from 20% to 30%, depending on the fund. This can also be referred to as an “Incentive Fee” or a “Performance Fee.”

Clawback: A clawback or clawback provision is a special contractual clause typically included in employment contracts by financial firms, by which money already paid must be paid back under certain conditions.

Cliff: Employee stock vesting agreements generally have a cliff, usually one year, before which no employee stock options vest.