UGA Startup Program Glossary

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organization or program that provides advice, mentorship, and/or resources to small businesses, often in a fixed period

monetary amount owed by customers or clients to your business for the goods or services your company provides

monetary amount your company owes to those who supply goods or services to you

leveraging preexisting success of a company or product in a new way

affluent individuals who provide capital for startups in early stages in return for stake in the company; typically provide funds from their personal wealth; can be referred to as simply “angels”

driven by goals to solve practical issues by creating a product, method, or service that could be commercialized

the company’s total financial holdings; current or short-term assets refer to cash or inventory while fixed or long-term assets refer to equipment or land; tangible assets are those you can touch such as a machine while intangible assets are those you cannot touch such as a patent or copyright

driven by a desire to expand knowledge and answer fundamental questions with no initial commercial aims

a benefit corporation; functions similarly to a C corp, but is driven by both mission and profit and required to be transparent about public benefits of the company

on the forefront of new developments or ideas, but ones that have not been reliably tested to allow for usage by the general public

using funding from personal resources to get started

overall profit of a company

Business to Business; a company that sells to other companies

Business to Consumer; a company that sells to the public

how quickly a company spends its money (also referred to as Run Rate)

a document used by entrepreneurs to outline their business concept along with their company’s strategic and financial goals; relied on by investors to be reassured there will be a return on their investment

money provided to entrepreneurs by investors to help fund the startup

a purchase that will continue to provide benefits beyond the taxable year in which it has been purchased, such as property and technology

the amount received from cashing in equity holdings which results in a cash transfer to the institution; excludes the cost at which the equity was acquired

movement of money though a company

a corporation that is taxed separately from its owners; offer the strongest protection of the legal liability of owners and shareholders, but at a higher formation cost; can raise capital through selling stocks; C corps are completely independent from shareholders

applies to shares given to employees over time in order for the CEO to be able to fire employees or let them leave without giving them stock in a short amount of time; can also be utilized by investors with regard to CEOs

development of a product through multiple entities working together

shared office space allowing for freedom from office management tasks; often used to foster growth through being surrounded by entrepreneurs

the percentage of business done by your company with each client; business with one or few clients can be negatively considered over-concentration

a situation in which an individual or entity has competing interests and as a result has the potential to take impartial and unreliable actions; usually requires removal of the conflicted party

a form of protection provided to authors of original works including literary, dramatic, musical, artistic, and certain other works; includes both published and unpublished works; grants exclusive right to reproduce the copyrighted work, prepare derivative works, distribute copies or phonorecords of the copyrighted work, perform the copyrighted work publicly, or display the copyrighted work publicly

a business structure typically chartered by the state or federal government in which ownership is held by shareholders (see C Corp, Close Corporation, B Corp, Nonprofit Corporation, S Corp)

raw material and production costs; fixed costs are those which do not change no matter the number of products produced while variable costs change based on the number of products produced

a good business, but one that is not scalable

a company seeks pre-orders or donation from customers to gauge interest and help to fund the growth of a product, often granting discounts or special packaged in return for customer support; involves use of platforms such as Kickstarter and Indiegogo

identification of consumer market and understanding those within the group in order to determine how your idea will be a solution to a problem they may have; can provide knowledge of how to improve and later market your product or service

issuing of new shares decreases the ownership held by existing shareholders

a technology that alters the way society does something

a technology that alters the way society does something

those in search of new and innovative products

those who purchase or become involved with an innovation due to marketing and usefulness of the product or service; also sometimes referred to as evangelists

Earnings Before Interest, Taxes, and Amortization; a measure of cashflow often used by investors

a succinct sales pitch used to present the entrepreneur’s idea(s) to potential angel or venture capital investors

an institution acquiring an ownership interest in a company (stock or the right to receive stock); often sold to investors; can be calculated by subtracting liabilities from assets; includes elements of license compensation economically equivalent to stock

the reporting of a license as exclusive or nonexclusive should follow the terms of the license agreement; exclusive licenses include those designated as exclusive by field of use, territory, or otherwise

the method used to sell a company

family controlled investment group in which the capital is the family’s own wealth

a marketing strategy in which the product is free, but has an option for more functionality gained with a subscription fee; a business model often used by internet startups and app developers

very early funding; can be a lifeline for capital, but has significant risks attached

financial support during the “Valley of Death” period; capital provided in order to get a product to market

Georgia Research Alliance; a program that seeks to grow Georgia’s economy by expanding research at universities and supporting startups involved with inventions and discoveries

percentage of sales earnings kept by a company after deducting costs for production or service

use of an unconventional marketing strategy to quickly scale growth; leveraging existing platforms to gain momentum

a timed work session of which the goal is to solve a specific problem; often done in groups comprised of members with different skills

one of the three people you need; has the ability to make the idea work

one of the three people you need; has intimate knowledge and “feel” for your customers

one of the three people you need; gets you paid and keeps everything moving; determines viability

the legal process resulting in the formation of a new corporation that separates the firm’s assets and income from the owners and investors of the company

supports startups in early development stages

the first time a company’s stock is made public; indicates a shift from private organization to public company

a physical space designed to foster brainstorming, collaboration, prototyping, or interaction

creations to which one has rights; held by a patent, copyright, trademark, etc.

continuous incremental changes and improvements in a business model or product development

the last group to begin using an innovation

those who begin using an innovation at the average speed usually based on its usefulness

start a company, app, or website

a method used to prove the business concept in a quick and inexpensive manner; utilizes frequent customer input

use resources of technology, partnerships, etc. to your advantage

debts owed by your business to others; current or short-term liabilities usually refer to expenses payable to a supplier while long-term liabilities most often refer to business loans

the number of license or option agreements executed in the year indicated for all technologies; each agreement is counted separately

formalize the transfer of technology between two parties in which the licensor allows the licensee to share the rights to use the technology; an option agreement gives the potential licensee a time period in which it may evaluate the technology and negotiate a license agreement

includes license issue fees, payments under options, annual minimums, running royalties, termination payments, the amount of equity received when cashed-in, and software and biological material end-user license fees equal to $1,000 or more; does not include research funding, patent expense reimbursement, a valuation of equity not cashed-in, software and biological material end-user license fees less than $1,000, trademark licensing royalties from university insignia, or income received in support of the cost to make and transfer materials under Material Transfer Agreements

Limited Liability Corporation; a popular business structure among small businesses that allows for the protection of personal liability, but does not require payment of corporate taxes

marketing through selling at a loss with the expectation of repeat business from customers

the period in which investors have agreed to wait to trade or sell their shares; typically occurs during the IPO of a company and involves shareholders who invested prior to the IPO

the group of consumers to which a company aims to sell its product or service

amount of potential market the company is capturing and how quickly

the most basic form of a product to satisfy a customer used to gather feedback for future development

the way in which the company will make money

shares with protective rights, meaning investments and increases in the number of shares does not affect the percentage ownership held by preexisting shareholders

the reporting of a license as exclusive or nonexclusive should follow the terms of the license agreement; a license designated non-exclusive or co-exclusive should be reported under non-exclusive

organized for charity, education, religious, literary, or scientific work; exempt from taxation on profits

a business structure with ownership by two or more people; unlimited personal liability unless structures as an LLP (Limited Liability Partnership); owners pay self-employment tax (except in the case of limited partners) and personal tax

a grant of a property right for an invention that gives the right to exclude others from making, using, offering for sale, or selling the invention within the United States or importing the invention into the United States; the typical term for a patent is 20 years from the date the patent application was filed; includes Utility Patents, Design Patent, and Plant Patents

the continuing influx of upcoming businesses; can also refer to the progression of ideas as they are refined through development

a major change in direction of the company, often due to lack of success in the original direction; moving towards a different market or using technology for a different purpose

the manifestation of an idea into an item made for consumer use that is typically marketed as a solution to a need or desire

measurable evidence that demonstrates the development of a project along with its scalability and potential for profit; often takes the form of a prototype or proof of market demand to express the potential for success of the idea

quick creation of models of a proposed product or idea through basic mock-ups or 3D-printed prototypes

a website made for optimal viewing across devices

the expected gain for an investor

the income gained from a business activity in a given time; earnings calculated by multiplying per unit cost by the number of units sold

actions with possibility of failure; the six main areas of risk are market, technical, financial, skills and experience, regulatory, and protection

how quickly a company spends its money (also referred to as Burn Rate)

royalties earned on and tied to the sale of products

functions similarly to a C corp, but are able to pass some profits and losses through the owners’ personal income to avoid corporate taxes; must file with the IRS to receive S corp status; state taxation varies; limited to 100 shareholders and all must be U.S. citizens

Software as a Service; often subscription based

Simple Agreement for Future Equity; an agreement between an investor and a company that grants the investor rights to future equity without initially setting a specific price per share

The Small Business Innovation Research Program/The Small Business Technology Transfer Program; NASA programs to provide seed funding for the development of innovative technologies that fulfill NASA needs and have the potential for successful commercialization

a development that has the ability to grow to reach a large market

first round of small investment during the early stages of a company

first significant round of investment in which venture capital is sought by a startup

the venture capital investment round following Series A

workspace designed for interaction of various occupants, typically entrepreneurs, those working on start-ups, and freelancers; allows for the creation of a work community for those who otherwise would not have one; often involves the renting of office space

shares of the company in exchange for work

method for estimating the maturity of a technology; helpful in making decisions about the development of technology; TRL 4-6 are often deemed the “valley of death” period; levels:
TRL 0: Idea
TRL 1: Basic research
TRL 2: Technology formulation
TRL 3: Applied research – proof of concept
TRL 4: Small scale prototype
TRL 5: Large scale prototype
TRL 6: Prototype system – commercial feasibility
TRL 7: Demonstration system
TRL 8: First of a kind commercial system
TRL 9: Full commercial application

activities associated with the identification, documentation, evaluation, protection, marketing, and licensing of technology and intellectual property management; includes all activities associated with the day-to-day operations of a Technology Transfer Office

document between investor and startup outlining the basic terms for financing, often including percent ownership and voting rights

expenditures made by the institution in support of its research activities that are funded by all sources; includes funds from the federal government, local government, industry, foundations, voluntary health organizations, and other nonprofit organizations; includes indirect costs

evidence of established success of the company’s product

an identifying word, name, symbol, device, or any combination used to identify and distinguish goods of differing parties; also used to prevent others from using a similar mark; registered through government offices

protects anything that has commercial value from not being generally known by others

innovation involving entrance into a new market, use of a new distribution strategy or testing of a new business model; long-range form of innovation

the period between applied research and demonstration of a commercial product

the estimated worth of a company; there are many valuation methods, including, but not limited to:

Berkus

Book Value

Comparable Transactions

Discounted Cash Flow

First Chicago

Liquidation Value

Risk Factor Summation

Scorecard

Venture Capital

a statement used by companies to persuade customers to buy their product or service, rather than that of a competitor

financing provided to small, high-risk startup companies with major growth potential in exchange for equity

the investors who work for venture capital firms

measures the efficiency and short-term financial health of a business; calculated by subtracting current liabilities from current assets; shows the ability of a company can pay short-term debts

Sources

Bump, Pamela. “A Glossary of Innovation Terms and Strategies.” Innovation Leader, 2 January 2018, https://www.innovationleader.com/corporate-innovation-glossary/.

“Choose a Business Structure.” U.S. Small Business Administration, https://www.sba.gov/business-guide/launch-your-business/choose-business-structure.

“Entrepreneur Dictionary for Startups.” Launchopedia, https://fundingsage.com/entrepreneur-dictionary-for-startups/?dictionary-letter=b.

“General Information Concerning Patents.” United States Patent and Trademark Office, October 2015, https://www.uspto.gov/patents-getting-started/general-information-concerning-patents#heading-2.

Harrison, Kate. “40+ Startup Jargon Words You Need to Know to Raise Money.” Forbes, 29 August 2014, https://www.forbes.com/sites/kateharrison/2014/08/29/40-start-up-jargon-words-you-need-to-know-to-raise-money/amp/.

Manu, Samidha. “NASA SBIR/STTR Basics.” NASA SBIR/STTR, 8 July 2019, https://sbir.nasa.gov/content/nasa-sbirsttr-basics.

NSBC Editorial Team. “10 Finance Terms Every Entrepreneur Should Know.” The Small Business Site, March 2019, https://www.thesmallbusinesssite.co.za/2019/03/18/10-finance-terms-every-entrepreneur-know/amp/.

Pascual, Shelley. “The Top 20 Startup Jargon Terms You Need to Know.” Startup Guide, 11 December 2018, https://startupguide.com/startup-jargon-terms-you-need-to-know.

Reddigari, Manasa. “15 Basic Business Terms Every Entrepreneur Should Learn.” Microsoft, 25 May 2017, https://www.microsoft.com/en-us/microsoft-365/growth-center/resources/basic-business-terms.

“2018 instructions and Definitions.” AUTM, 24 February 2018.

“Who We Are.” Georgia Research Alliance, http://gra.org/page/1002/about_gra.html.