Entering the world of startups can feel like stepping into a whole new language. The startup ecosystem is filled with unique jargon and slang that can leave newcomers feeling bewildered. Whether you’re an aspiring entrepreneur, an investor, or simply interested in the startup world, this guide aims to demystify the language used in the startup community. Here are 40 essential startup terms and phrases to help you navigate the conversations and understand the lingo.

• A/B testing: Experimenting with two different versions of a product or feature to determine which performs better.
• Accelerator: A program that supports early-stage startups through mentorship, education, and funding in exchange for equity.
• Acqui-hire: A term used to describe a business strategy in which one company acquires another primarily for the purpose of hiring its employees, rather than for the products, services, or intellectual property of the acquired company.
• ARR: ARR stands for “Annual Recurring Revenue.” It is a metric used primarily in subscription-based businesses to calculate the predictable and recurring revenue generated from customer subscriptions over a one-year period.
• Angels: Angel investors who provide capital and support to early-stage startups in exchange for equity.
• Bootstrapping: Building a startup with minimal or no external funding, often relying on personal savings or revenue generated by the business.
• Burn rate: The rate at which a startup consumes its available capital to cover expenses.
• Burnout: Physical or emotional exhaustion experienced by startup founders or employees due to high stress and long working hours.
• CAC: Customer Acquisition Cost, the cost incurred by a startup to acquire a new customer.
• Cap table: A table or spreadsheet that outlines the ownership stakes and equity distribution among a startup’s shareholders.
• Churn rate: The rate at which customers or users stop using a product or service over a given period.
• Cockroach: A resilient startup that can survive adverse conditions or setbacks, they focus on tangible long-term viability.
• Disintermediation: Removing intermediaries from a supply chain or market, often facilitated by technology or innovative business models.
• Disruptive innovation: A groundbreaking product, service, or business model that creates a new market or significantly disrupts an existing one.
• Disruptor: A startup or company that introduces innovations or new technologies that significantly impact an industry or market.
• Exit: The point at which a startup founder or investor sells their ownership stake in a company, typically resulting in a financial gain.
• Exit strategy: A plan outlining how a startup founder or investor intends to monetise their investment, such as through acquisition or an initial public offering (IPO).
• Equity Crowdfunding: A method of raising capital for a business or project by sourcing small investments from a large number of individuals, typically through an online platform. In equity crowdfunding, investors receive shares or equity in the company in exchange for their investment, making them partial owners or shareholders.
• Gamification: Incorporating game-like elements, such as rewards or challenges, into a product or service to increase user engagement.
• Incubator: A program that provides resources and support to help startups grow and develop their ideas.
• Intrapreneurship: Refers to the practice of fostering an entrepreneurial mindset and behavior within an established organization. It involves empowering employees to think and act like entrepreneurs within the confines of their existing roles and responsibilities.
• MVP: Minimum Viable Product, the most basic version of a product that can be released to gather feedback and validate the market.
• Pitch Deck: A pitch deck is a concise presentation that provides an overview of a business or startup to potential investors, partners, or stakeholders. It is typically a slide deck that serves as a visual aid during a pitch or presentation.
• Pivot: Changing a startup’s direction, strategy, or business model in response to market feedback or challenges.
• Product/Market fit: The degree to which a product satisfies a strong market demand. Product/market fit has been identified as a first step to building a successful startup which meets early adopters, gathers feedback and gauges interest in its product
• Pro-rata rights: Also known as “preemptive rights” or “anti-dilution rights,” are the rights granted to existing shareholders or investors in a company that allow them to maintain their ownership percentage and participate in future equity financing rounds.
• Running lean: Operating a startup with minimal waste, focusing on essential tasks and resources.
• Run rate: Extrapolating a startup’s current financial performance to estimate its annual revenue or expenses.
• Runway: The amount of time a startup has before it runs out of funding, often measured in months.
• ROI: Stands for “Return on Investment.” It is a financial metric used to measure the profitability or efficiency of an investment relative to its cost. ROI provides a way to assess the return or gain generated from an investment compared to the initial investment amount.
• SaaS: Stands for “Software as a Service.” It is a software delivery model (usually a subscription) in which software applications are provided over the internet as a service.
• Scalability: The ability of a startup to handle increased demand without sacrificing performance or incurring significant costs.
• Seed funding: The initial capital raised by a startup, usually from friends, family, or angel investors, to develop and launch the business.
• Series A, B, C rounds: Series A, B & C are terms for increasing levels of funding based on the stage of a business, therefore the main difference is the amount of funding available for each round, and the level of a scale a business would need to be at to progress to the next stage.
• Serial entrepreneur: An individual who starts and operates multiple businesses over their career.
• Stealth mode: Operating a startup in stealth, keeping it secretive and not revealing its product or business model to the public.
• Sweat equity: Refers to the contribution of effort, time, skills, or expertise that an individual puts into a project or business venture in lieu of financial capital. It represents the value created through one’s labor and contribution rather than monetary investment.
• TAM: Total Addressable Market (TAM) refers to the total revenue opportunity available for a particular product or service within a specific market.
• Term sheet: A term sheet is a non-binding document that outlines the key terms and conditions of a proposed investment or business transaction. It serves as a preliminary agreement and acts as a blueprint for the final legal agreements and negotiations that will follow.
• Unicorn: A startup company valued at over $1 billion.
• Vesting: Refers to the process by which an individual earns ownership or control rights over a particular asset, such as company stock options or retirement funds, over a specific period of time. It is commonly used as a mechanism to incentivize loyalty, long-term commitment, and retention of employees or stakeholders.
• Wireframing: A visual representation or blueprint of a website, application, or user interface (UI) design. It is an early-stage design technique that focuses on the structure, layout, and functionality of a digital product, without including detailed visuals or graphic elements.
• Zebra: A startup focused on building a sustainable and profitable business, contrasting with the “unicorn” pursuit of rapid growth.

With this startup language guide, you’ll be equipped with the knowledge to engage in conversations within the startup community confidently. By familiarising yourself with these essential terms and phrases, you’ll be able gain a deeper understanding of the startup world and be better prepared to navigate its unique language. So step into the world of startups, expand your vocabulary, and be a part of the conversation.