Definition of investment terms

Below, we list out brief definitions of some of our most commonly referenced investment rounds and terms.

Acquired: The default label for company acquisitions. These can include both private and public company acquisitions. If an unspecified buyer acquires a company, it is entered as “acquirer”.

Angel: When angel groups or individual angels invest in company.

Biz Plan Competition: The cash prize or award given to a company in a business plan competition. No equity is involved.

Bridge: A debt round or short term loan until a company secures its next round of funding.

Convertible Note: A debt investment that allows for conversion into equity. Only recorded for private companies.

Corporate Majority: Company acquires 50.01% - 95% of a private company’s equity.

Corporate Minority: Company acquires 50% or less of a private company’s equity.

Crowdfunding: Funding of a company by raising contributions or donations (no equity involved). 

Dead: This company is no longer in existence.

Debt: When a company receives a loan and pays it down over time with interest.

Grant: Government entity or foundation award that provides non-repayable funds to a company.

Growth Equity: A VC, private equity, or investment firm makes an investment into mature companies looking to expand or restructure operations.

Incubator / Accelerator: Funds received from an Incubator/Accelerator program with no equity involved. 

IPO: Occurs when a company goes public.

Merger: A type of exit round where companies merge into one entity. 

Mezzanine: Debt financing that gives the lender rights to convert to an ownership or equity interest if loan is not paid back.

Private Equity: Investments that are not listed on a public exchange. Barietiated as “PE,” it comprised of funds and  investors that invest directly in private companies.

PIPE: Funding rounds after completion of an IPO. When a private company / PE / VC invests in a Public company.

Reverse Merger: Public company acquires a private company or private company becomes Public, and Public company is absorbed into the private company.

Seed: The initial capital used to start a business. Also used when an incubator or accelerator (Inc/Acc) receives an equity stake in a startup.

Seed VC: Initial capital raised from a VC firm.

Series A: The first significant round of funding, usually following a seed or seed VC round. Seed and Series A financings are typically referred to as “early-stage” rounds.

Series B: Second significant round of funding that tends to be a larger amount of money than seed or Series A rounds.

Series C: Third round of funding. Stages B and C are sometimes called “mid-stage” rounds.

Series D - K+: Late-stage funding rounds.

Take Private: A public company gets acquired by a PE or venture capital firm and is taken Private. The acquired company stops trading.

Unattributed: An unknown funding round not involving a venture capital or private equity firm. 

Unattributed VC: An unknown funding round involving a VC firm.





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