Glossary

Glossary created by Funderbeam. Contributions from the Business Angel Institute and Invesdor.com

Terms beginning with: B


Benchmarking

The process of comparing a company's performance, costs, products, or strategies to those of leading firms, peers, or standards within the industry. Benchmarks are also used for the valuation of early-stage companies by comparing them to known examples.

Berkus method

A method for valuing pre-revenue startups. According to Berkus, the value depends on five main drivers: soundness of idea, quality of the management team, quality of the board, prototype, and product sales. Typical valuations range from $1-6m.

Board member

Please see Investor roles

Bonds

An interest-bearing debt instrument that governments and businesses use to borrow funds. Bonds are an alternative to bank loans and can be secured or non-secured, listed or non-listed.

Bridge loan

A short-term loan used in anticipation of a permanent loan or financing in order to meet current obligations. Related: Financing rounds

Burn rate

The rate at which a startup is spending its capital to finance overhead before generating a positive cash flow.

Business angels

Individual investors who provide capital and support for startups and entrepreneurs. Usually they bear very high risk and therefore seek a high return on investment.

Business angels

Individual investors who provide capital and support for startups and entrepreneurs. Usually they bear very high risk and therefore seek a high return on investment.

Business model canvas

Please see Canvas

Business model canvas

Please see Canvas

Business plan

A written, formal description of a business that usually contains information on its financial data, strategy, products and services, market analysis, and marketing plan.

Buyback

Please see Exit channels and Repurchase