An accelerator supports startups for a limited period during the early stages of business development through coaching, mentoring, financial assistance, and access to necessary networks. Such experts may include investors, business partners, industry experts, and business angels.

Benchmarking is a method of comparing one's own products, services, and processes with those of competitors. This process aims to identify potential improvements within the company.

A financing method in which external investor capital is avoided. The company is financed solely through self-generated cash flow. The advantage of bootstrapping is that the founding team does not experience dilution, meaning they do not have to give up shares and thus retain full entrepreneurial freedom. However, bootstrapping requires strict discipline in expense management from the founding team and can potentially slow down growth.

Bootstrapping Plus is a hybrid form of startup financing. Compared to traditional VC financing with 3-5 funding rounds, Bootstrapping Plus funds the startup primarily through self-generated cash flows and later complements it with 1-2 funding rounds from suitable investors. Bootstrapping Plus is typically used by startups in niche markets that are considered too small for traditional VCs. This results in lower dilution for founders and smaller but still attractive exit opportunities. This type of financing is particularly useful for e-commerce businesses.

The point at which a company reaches the profitability threshold and generates profits for the first time.

A Business Angel is a private investor who supports startups with capital, expertise, and networking opportunities. Typically, a Business Angel is an experienced (startup) entrepreneur or top manager and invests in early-stage financing rounds (e.g., pre-seed or seed rounds). Business Angels hope for a positive appreciation of their shares, which they can sell at a later stage. This could happen, for example, through a full exit by the founding team or a "secondary" sale during a larger financing round with new investors. Some Business Angels also organize themselves into Business Angel Clubs to complete joint deals.

A written business concept that explains the business idea, business model, implementation strategy, and the background of the founding team. Nowadays, lengthy business plans have lost significance, with the focus shifting towards tangible traction.

CVC ("Corporate Venture Capital") refers to equity capital provided by strategic investors, usually other companies with market relevance.

The Capitalization Table records how many shares belong to whom in a company. Employee stock ownership plans, corporate structures, and liquidation preferences must be considered, as well as the distribution of shares, which can shift significantly over different investment rounds.

The Cash Burn Rate refers to the rate at which a startup burns money. Typically, existing cash reserves are divided by the negative cash flow over a given period. The result indicates how long until the company runs out of money. The Cash Burn Rate is particularly relevant in fundraising, as fresh investor capital needs to be raised before the startup becomes insolvent. Additionally, investors want to understand how long the invested capital will last in the company ("runway").

Churn or the Churn Rate, especially in subscription models, indicates how many or what percentage of customers have canceled their subscription and no longer purchase from the company. A company naturally aims to keep churn as low as possible. The opposite of churn is Customer Retention.

Closing typically follows a few weeks after signing. It refers to the actual completion of the signed contract.

In cohort analysis, customers are divided into unchanging groups (cohorts), usually based on a purchase time frame and their behavior (e.g., repeat purchases, order volume, or time intervals between purchases). These are analyzed over an extended period. This method helps calculate important metrics such as Customer Retention, Average Order Value, and Customer Lifetime Value while tracking them over time.

The Contribution Margin represents the profitability of a product or service at various levels. The Contribution Margin is the amount available to cover fixed costs after deducting all variable costs.

The conversion rate describes the ratio between the total number of website visitors and the number of visitors who performed a specific action on the website.

The convertible loan is a popular financing method among business angels and micro-VCs. A startup receives capital in the form of a loan, which has equity-like characteristics. In the next financing round or during an exit, the convertible loan is typically converted into company shares. The advantage of convertible loans lies in the avoidance of notary costs and the speed of financing. Furthermore, the investor and the company do not have to agree on a valuation immediately but can define a valuation corridor for the conversion using a "cap," "floor," and "discount." Several standardized templates (e.g., GESSI) already exist to simplify the process for founders when setting up a convertible loan agreement with an investor.

A method of decentralized capital raising from private investors, business angels, friends, family, and customers—usually facilitated through platforms.

"Customer retention" describes a startup's ability to encourage first-time customers to continue using the product and make repeat purchases, with the goal of building long-term customer loyalty to the company.

A data room is a secure space where information such as contracts and company documents are stored. The purpose of such a data room is to consolidate company information so that it can later be shared securely and confidentially with others, such as investors or potential buyers, during the due diligence process.

Deal flow refers to the potential investment opportunities that an investor receives.

Dilution refers to the reduction of an investor's percentage ownership due to the issuance of new shares, often occurring during financing rounds.

A careful and systematic examination of a potential investment, acquisition, or merger candidate's data.

An elevator pitch is a 60-120 second short introduction of a startup. The goal is to briefly present the equity story to a potential investor in order to secure a more detailed discussion about a possible investment.

An exit refers to the founder’s departure from their company, typically through the sale of their company shares. In most cases, an exit is realized through a sale to a strategic or financial investor (trade sale) or an initial public offering (IPO).

With FBA ("Fulfillment by Amazon"), online retailers can utilize Amazon’s warehousing and shipping network.

The financial model is a summary of a company’s performance using key financial variables. It helps predict future financial performance and forecast the outcomes of different financial decisions to make the best possible choices. Key components of a financial model include financial data on operations, accounting, and corporate financing.

Fundraising refers to the process by which a startup raises fresh capital from investors to finance its operations and growth.

A strategy in online marketing that aims to increase a company's awareness and sales with minimal financial effort. This is achieved through free or low-cost tools and channels such as social media, SEO, or content analysis to drive rapid growth.

An IPO (Initial Public Offering) refers to the first listing of a company’s shares on the stock exchange. The IPO serves as a key exit channel for startups with high valuations. Additionally, startups can raise fresh capital on the stock market to finance their growth plans.

An incubator supports founders in building a startup by providing services, products, or office space. The expertise and knowledge of an incubator help increase the chances of success for young startups. Incubators typically run multi-month programs, where they advise startups, assist in product development, and help craft market strategies.

"Investor Fit" describes the degree of alignment between a startup's profile and an investor’s expectations. Venture capital investors (VCs) follow different investment approaches, which may vary based on target sector, geographic focus, financing stage, and investment amount. For a successful fundraising process, it is advisable to assess the Investor Fit before reaching out to potential investors.

The term Investor Pipeline describes all investors in the fundraising process who are in the investment decision-making phase but have not yet been contacted or approached.

Investor Readiness describes the structured preparation of startups to present a strong storyline, a good pitch, as well as professional analyses and data about the company to potential investors. Good preparation plays a crucial role in determining whether an investment will take place.

Metrics that are particularly important for a startup. KPIs can be used to check whether the startup is meeting its set objectives.

Life-Time-Value describes how much money a startup can earn from a customer over the course of a product's lifecycle. LTV helps companies calculate how much they can invest in customer acquisition. LTV is calculated at different levels. LTR refers to Life-Time-Revenue, while LTV is usually calculated based on Contribution Margins (CM1, CM2, or CM3).

LTV or CLV (Customer Lifetime Value) / CAC (Customer Acquisition Cost) is an important metric for startups. It describes the ratio of revenue from a customer over their entire customer lifetime, minus the costs of revenue and other directly attributable costs, to the cost of customer acquisition. A CLV / CAC ratio below 1 means that acquiring a customer costs more than they generate over time. A CLV / CAC ratio above 1 means that more revenue is earned from a customer than what was spent to acquire them.

An agreement regarding non-binding negotiations between the founder of a startup and, for example, a potential investor. The goal of the LOI is for the contracting parties to confirm that they will conduct exclusive negotiations for a specific period and will not disclose business secrets (Non-Disclosure / Confidentiality).

Abbreviated as "Liq. Pref." or "liquidation preference" in English. Investors often demand a liquidation preference in their investments. This ensures the investor's right to be prioritized in the distribution of proceeds in case of an exit or liquidation. For example, investors may retain their original investment amount in an exit scenario before the founding team participates in the proceeds. This way, the investor protects themselves from unfavorable exit valuations.

The liquidity plan is an important part of a company's financial planning and complements revenue and cost planning. It is used to precisely determine which cash flows occur at what time to ensure the company remains liquid.

An analysis that represents the potential market size. The "TAM-SAM-SOM" method is well established in the fundraising process.

Connecting investors and startups.

Describes the practice of selling, buying, and merging companies. M&A advisors, such as Venture Advisory Partners, facilitate the process for all parties involved.

An NDA (Non-Disclosure Agreement), or confidentiality agreement, is a contract between two parties that ensures secrecy regarding all exchanged written or verbal information related to a specific project. The parties commit to handling all shared information confidentially, even after the project has ended. Potential investors, such as VCs (Venture Capitalists), typically do not sign NDAs, as these would overly restrict their operational activities.

A presentation containing the most important information about a startup as part of a fundraising round. The goal is to convince potential investors to invest. The Pitch Deck introduces the startup and provides insights into aspects such as the product, market & competition, financial metrics, the team, and unique selling points. All these elements are combined into a compelling and coherent Equity Story.

A pivot refers to the strategic shift in a startup’s business model to better align with market demand. Various reasons can lead to a pivot, such as customer feedback suggesting the need for change or new regulatory market conditions.

The Post-Money Valuation refers to the value of a company after completing a fundraising round. Example: If a startup raises €2.0 million from investors in exchange for 20% of its equity, the company is valued at €10.0 million post-money. To determine the pre-money valuation, the investment amount is subtracted from the post-money valuation. In this case, the startup would have a pre-money valuation of €8.0 million.

The Pre-Money Valuation refers to the valuation of a startup before completing a fundraising round. (See "Post-Money Valuation").

Q&A sessions are exchanges between two parties where questions are asked and answered in a structured manner. These sessions are a regular part of due diligence processes during fundraising or M&A transactions, where investors or acquirers can ask the company's management team important questions.

Scalability refers to the ability of a business model or company to adapt to rapid growth or enable such growth while becoming increasingly profitable.

A more advanced startup that is already in the expansion phase.

Signing refers to the signing of an investment agreement or a Share Purchase Agreement in an M&A deal or during fundraising. Once all conditions for completing the deal are met, it is finalized (see "Closing").

Syndication allows multiple investors to come together and collectively provide the necessary funding for a company.

"Ticket Size" refers to the financial amount that an individual investor invests in a startup during a fundraising round. In contrast, "round size" refers to the total amount invested in the company at a given point in time.

The momentum with which a startup grows. It can generally be divided into "Soft Traction" and "Hard Traction". Soft Traction refers to all non-monetary metrics that indicate strong growth, such as user growth. Hard Traction describes the positive development of financial metrics with a monetary impact, such as revenue or Average Order Value (AOV).

The unique feature of a product or service that differentiates it from competitors in the market.

A Unicorn is a startup with a valuation of more than $1 billion before going public or being acquired. A Decacorn refers to a startup with a valuation of more than $10 billion.

Venture capital, also known as risk capital, refers to investment capital that investors provide to startups and growth companies. This is typically done in the form of equity or mezzanine financing. Young companies often rely on financing structures similar to equity, where both the investor and the company share risks as well as potential value increases.