Do you speak VC? 10 terms you must know before raising venture capital
Raising money for your startup can be a challenging experience for any entrepreneur, but especially as a newbie. Not because pitching is difficult and not because VCs are hard to impress. The challenge lies in the nuances of hearing and understanding what a venture capitalist says. As is the case in every industry, there’s a certain level of jargon used in the venture capital world that can make you feel like you’re reliving the Tower of Babylon. Navigating the complicated world of money can be a mess of confusing terminology. In a recent article, Forbes put together 10 terms you need to learn before raising venture capital. Read our abridged definitions for the terms below and study them well! Put your money where your mouth is Pre-money vs. Post-money Valuation: Valuation is the monetary value of your company. Pre-money valuation refers to a company’s total value before new money is invested. Post-money valuation refers to a company’s total value after new money is invested. In other words: Post-money valuation = pre-money valuation + new funding. Convertible Debt: Convertible debt (also called convertible notes) is a type of bond that the...
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