Concepts

LAST REVIEWED 2026-09ONE PAGE PER TERMEVERY PAGE CARRIES A QUOTE FROM THE ROOM

Each concept is one page: a plain-language definition, why it matters, what a practitioner actually said about it, and where founders get it wrong. Every page links back to the playbook that covers the decision in full. The one-page glossary still exists if you want everything on a single screen.

Exits

• Acqui-hire — Distressed sale of the team, not profits or standalone IP. The negotiation is a retention carve-out; common typically goes to zero.
• Add-backs — Owner expenses added back to EBITDA for a sale; optimize for taxes while operating, recast for enterprise value before you sell.
• Customer concentration — The share of revenue from your largest customer. Buyers flag it above 15%; above 25% it changes the deal structure.
• Earn-out — Exit proceeds parked against post-close milestones, usually 25–50%. Can be starved by the acquirer unless the deal funds your roadmap.
• EBITDA multiple bands — The EBITDA ranges private equity prices against. Crossing a threshold rerates the whole company.
• Letter of intent (LOI) — The non-binding offer that opens diligence. Your price ceiling, not your floor.
• Quality of earnings — The buyer’s review of whether your revenue and margins are what you say they are.
• Strategic vs. financial buyer — Two acquirers, two pricing logics: build-vs-buy heuristics vs. transaction multiples.

Fundraising and terms

• Investor qualification — Ask the fit questions before you pitch: active? last check? deployment stage? Then diligence them back.
• Liquidation preference — Who gets paid first at a sale. 1x non-participating is the standard; anything above it is a red flag.
• LTV:CAC — Lifetime value over acquisition cost. 3:1 is the investor floor; 4:1 is the working bar.
• Material-change update — Three sentences, no ask, sent to investors who passed whenever something real changes.
• Pre-money vs. post-money — Whether the valuation includes the new money. Confirm it in writing before negotiating anything else.
• SAFE — An IOU for preferred stock. Not debt, not equity; the default instrument under roughly $5M.
• Valuation cap — The maximum valuation a SAFE converts at. Scale it to the raise or you sell the company by accident.
• Venture debt — Senior, non-converting debt underwritten to your next equity round. An accelerant, never a rescue.

Equity and legal

• 83(b) election — The 30-day filing that taxes restricted stock at grant instead of at every vest.
• 409A valuation — The fair-market value that sets option strike prices. The one valuation you want low.
• Administrative dissolution — Let the entity lapse by stopping the annual state filing, rather than paying a fee to dissolve. Not a substitute for payroll or counsel.
• Advisor equity — 0.1–0.5% on one to two years of vesting. Never a percentage of money raised.
• Founder vesting — Four years, monthly, one-year cliff, for every founder including you.
• IP assignment — The signed transfer of work product to the company, from everyone who ever touched the code. Never call helpers volunteers.

Getting customers

• Buying committee — Champion, economic buyer, users, procurement, security. The champion is not the committee.
• Customer development — Learning and selling as one funnel: score the pain, book the next step, never end a call without one.
• Founder-led sales — The phase where founders close, because the learning cannot be delegated. There is no autopilot for GTM.
• GTM hypothesis — This customer, this problem, this message, this channel, this action, because of this proof. Not because it worked for someone else.
• Internal champion — The buyer-side person who closes the deal in rooms you are not in. Arm them.
• Pilot vs. paid contract — A customer pilot is paid, time-boxed, and ends in a PO. A design-partner discount is traded for proof points, not used as a substitute for the deal.
• Price-to-pain ratio — Price at about one-tenth of the buyer’s quantified pain, anchored high and discounted visibly.
• Scatter-plot funnel — Buyers enter awareness, interest, consideration, and decision in any order from anywhere. Be present wherever they land.
• Vitamin vs. painkiller — Nice-to-have, active frustration, or emergency. The GTM job is often to make a vitamin feel like an emergency once they have seen the faucet.
• XYZ hypothesis — X% of market Y will pay $Z, tested with the cheapest prototype until it comes back true 70–90% of the time.

Building the company

• AI-native — Agents do the work at every delivery stage; humans set policy. Not the same as buying a coding assistant.
• Amdahl’s law — You are gated by the slowest step. Ten-x coding and the company barely moves until review, test, deploy, and operate catch up.
• Blue ocean — A lane you own. The alternative is a sea of sameness or a red ocean of feature competition, and a SaaS clone now takes days.
• Data moat — Of algorithms, compute, and data, the only defensibility a startup can own.
• Default alive — Cut burn until cash flow is nonnegative without new capital. Most teams cut too shallow and still siphon cash.
• Engineering sovereignty — Run what you want, when you want, where you want. Not tied to one platform, cloud, or model.
• Meat proxy — A human forwarding AI output without reading it, acting as the relay between agents, Slack, CI, and prod.

More concepts are added as sessions cover them. Missing one? It probably gets asked in the room; FounderNexus is where it gets answered.