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Accelerator
An accelerator is a cohort-based, fixed term program with the primary aim to rapidly grow startup businesses. Limited to a 3 – 4 month intensive period, startups are given access to mentorship, education, networking and funding. At the end of the fixed term, the startup is to “graduate”, ending their program with a demo day where they present to investors. In exchange for all the benefits provided by the accelerator, the entrepreneur will give a share of equity to the partners of the accelerator program.
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Advisory & Education
Support organisations and corporations that provide advice and training for small businesses, startups and aspiring entrepreneurs
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Angel Investor
An angel investor is an individual investor who provides seed or growth capital for businesses usually in exchange for convertible debt or equity. Generally former entrepreneurs or professionals, angel investors are usually driven not only by profit, but by the success in the business venture. Consequently, angel investors generally provide not only capital but also indirect expert advice and contacts to help the business succeed.
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ARPU – Average Revenue Per User
ARPU measures revenue generated per unit and is used to analyse a company’s revenue generation and growth. This assists investors in determining the high or low revenue-generating products.
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ARR – Annual return rate
The Annual Rate of Return is expressed as a time-weighted annual percentage, and is the return an investment provides over a period of time.
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B2B
Business to business - when the offerings of a business are made towards another business
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B2C
Business to consumer - when the offerings of a business are open to the general public
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Bootstrapping
When an entrepreneur starts up an enterprise without the use of external sources of finance. This may include money from the pocket or borrowings from family and friends.
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Bucket testing
A method of market testing in which two versions of an element are compared using metrics
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Burn rate
The rate at which a new company uses up its funds to finance overhead before generating positive cash flow from operations.
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CAC – Customer Acquisition Cost
CAC, is the cost of convincing a potential customer to buy a product or service. CAC can be calculated by simply dividing all the costs spent on acquiring more customers (marketing expenses) by the number of customers acquired in the period the money was spent.
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Churn rate
The percentage of people who have stopped using the service offered by a company.
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CMRR – Committed Monthly Recurring Revenue (Sometimes called MRR)
Committed Monthly Recurring Revenue excludes revenues that are not recurring, and is the value of a portion of subscription revenue that is recurring over a month long period.
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Co-working space
Entrepreneurs and startups can hire co-working spaces. This kind of environment allows startups and entrepreneurs to immerse themselves into like-minded communities, where they can build networks, establish connections, and grow.
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Competition
Compete against other teams in competitions within the start-up space to test and get your idea out there. You may even secure yourself some interested investors.
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Conversion
The amount (usually in %) of visitors or interested people which become actual customers.
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Cottage business
A good business but not something massively scalable. Although not fit for VC, the business can still be successful.
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Decacorn
A startup valued at $10 billion or more
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Disruptive
Anything that is new and innovative that radically changes the existing industry or market, usually resulting in the displacement of old methods or technologies.
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Early adopter
A person who embraces a new product, service or company before everyone else does.
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Elevator pitch
A concise, carefully planned overview of your idea or company that can be delivered in the time it takes to ride an elevator.
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Event
Join other entrepreneurs in networking, skill development and thought provoking seminars.
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Exit
The act of transferring ownership either through sale or trade.
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First mover advantage (FMA)
The advantage gained by the initial significant occupant of a market segment
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Founder syndrome
When a founder begins to believe that the success of his startup requires their insistent input in everything and neglects the importance of teamwork and listening to others.
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Freemium
A freemium product strategy is one where the core product is available free of charge, but users have the option to purchase a premium version of the product or service for price.
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Gamification
The application of gaming elements (e.g. point scoring, competitions, badges) in real life to boost engagement. It is typically used in as an online marketing technique to encourage engagement with a product or service.
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Growth hacking
A marketing technique which focuses on rapid growth through non-traditional tactics such as social media.
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In the wild
When a new technology or concept is out in the real world, not just on the drawing board, launches or demos.
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Incubator
Incubators provide business support resources and services such as networking connections, capital, coaching and physical space to help accelerate the growth and success of startup businesses. Incubation programs are usually sponsored by public institutions, such as universities, or private businesses to help create or foster growth of young businesses.
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Intellectual property (IP)
Creations of intellect which includes designs, logos, inventions, business processes and secrets.
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Intrapreneur
People in large companies who are given the freedom and environment to be innovative.
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Investment Fund
Larger investment institutions which provide a variety or combination of funding options
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Lean
A management approach which maximises customer value by minimising waste.
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Leverage
To use something to your advantage
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Loss leader strategy
Offering a product or service at a loss as a form of marketing expense to bring in customers that you expect future business from.
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Low hanging fruit
The easiest method of generating revenue for startups.
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LTV – Customer Lifetime Value
LTV is based on the present value of the projected future cash flows, representing the dollar value of the customer relationship. This concept shifts the focus of firms to maintaining long-term customer relationships, rather than just quarterly profits.
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Market penetration
The extent at which your potential market is engaged with your product or service.
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Media
Publishers of entrepreneurial topics and interests which may include news articles and tips for entrepreneurs.
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Minimum viable product (MVP)
The version of the product that allows the maximum amount of validation with the minimal amount of effort in product development.
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Monitise
The process of generating money from.
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Network
A group of people who come together with common interests in entrepreneurship to share support, advice and discussion
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Non-disclosure agreement (NDA)
An agreement between two parties to protect sensitive or confidential information, such as trade secrets, from being shared with outside parties.
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One dollar billionare
Refers to the $1 salaray that founders and top executives award themselves which signals their confidence in the growth of the company and doubles up as a tax advantage.
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Pivot
To change directions with the focus of your startup.
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Pre-revenue
A startup which has not yet made a single dollar of revenue.
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Pre-seed Funding
Funding provided to entrepreneurs who have only a little more than an idea, usually used to achieve early market testing and validation of the idea.
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Private Grant
Financial assistance from private organisations, corporate organisations and communities
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Public Grant
Financial assistance from government which often involve stricter auditing requirements
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Responsive design
A platform built for optimal viewing across all devices.
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Retention rate
The ability of a product or service to maintain long-term returning customers.
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Return on Investment (ROI)
The ratio of expected output for an investor given their level of input.
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SaaS – Software as a Service
Software as a service is a software licensing and delivery model in which a software is centrally hosted and is licensed on a subscription basis.
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Scalable
Something that can grow to a large size due to a large market demand and an appropriate business model.
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Stealth mode
The stage of a startup in which they do not reveal what they are doing in order to protect secrets or ward off competition
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Sticky
When a product or service has a high retention rate.
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Sweat equity
Remuneration in the form of equity in exchange for work done, typically used in the early stages of a startup
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Term sheet
The document that outlines the terms of a funding agreement which will include information such as ownership and voting rights
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Traction
Evidence that people are actually or are readily willing to engage in the product or service.
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Unicorn
A term used to describe anything that is rare. It is often used in the context of people or start-ups.
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Value add
Providing additional value.
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VC funds/money
Funding that is obtained from a venture capitalst.
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Venture Capital
A venture capitalist can make loans to or equity investments in startup companies and small businesses with good prospects for long-term growth. Loans can carry rates of up to 20%. In addition, many venture capitalists seek a high rate of return, usually between 30-50%.
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Venture capitalist
An investment fund that manages money from investors who seek to make equity investments in startups and small enterprises with a high growth potential.