Fifty definitions, in plain words. Pre-seed through Series A. Built so you can send it to your operator hire and they'll catch up in an afternoon.
Most fundraise glossaries on the public internet are accurate and useless. They define ARR as 'annual recurring revenue' and stop. The reason that version doesn't help is that the question founders need answered isn't what the term means; it's what investors do with the term in a partner meeting. The definition is the surface. The use is the depth.
Each entry below is written for a specific reader: a founder preparing a deck, an operator hire reading their first cap table, or an associate writing the first cut of an internal memo. The 'short' line is the dictionary version. The longer line is what the term actually does in a live round — what number a partner is solving for, what trap the term hides, and which of the other forty-nine entries it should be read alongside.
Three reading paths, depending on where you are. Start with the round-stage cluster (pre-seed, seed, Series A, Series B) if you're orienting from scratch. Start with the metrics cluster (ARR, NRR, GRR, magic number, burn multiple) if the deck is built and the partner-meeting Q&A is killing you. Start with the structure cluster (SAFE, post-money, dilution, ESOP, liquidation preference) if a term sheet is on the table and the conversation just got expensive.
The first institutional check, usually before product-market fit.
Pre-seed rounds typically run from $500k to $3M and price the company between $5M and $15M post. Investors are buying the founder, the wedge, and the speed of learning. Revenue is rare and not required.
The round that funds 'the machine,' not the search.
Series A leads underwrite repeatability. The bar is roughly $1M to $3M ARR for SaaS, with NRR above 110% and CAC payback under 18 months. The story is: we found it, now we scale it.
Annualized recurring revenue. Monthly recurring × 12.
ARR is the headline metric for software fundraising. Investors care about the rate of change more than the absolute number. $1M ARR growing 20% month-over-month beats $3M ARR growing 5%.
Revenue growth from existing customers.
Expansion happens through seat growth, usage growth, or upsell to higher tiers. It's the cheapest revenue you can book and the main reason NRR can exceed 100%.
How long it takes to earn back the cost of acquiring a customer.
CAC payback in months = CAC ÷ (monthly gross profit per customer). Series A leads want to see under 18 months for SaaS. Under 12 is exceptional.
Lifetime value of a customer.
LTV depends entirely on retention assumptions. Most decks overstate it. The honest version uses a fixed cohort window (e.g. 24 months) and gross margin, not revenue.
Ratio of lifetime value to acquisition cost.
A 3:1 ratio is the rough industry rule. Below 1:1 means you lose money on every customer. Above 5:1 usually means you're underspending on growth.
Net new ARR ÷ S&M spend, annualized.
A magic number above 1 means sales and marketing dollars are working efficiently. Above 1.5 is excellent. Below 0.5 means GTM isn't paying for itself yet.
Net burn divided by net new ARR.
Coined by David Sacks. A burn multiple under 1 is great. Above 3 is concerning. It's the cleanest single number for capital efficiency at growth stage.
Cash out minus cash in, monthly.
Gross burn is total spend. Net burn subtracts collected revenue. Investors care about net burn because it determines runway. Show both, not one.
How many months of cash you have at current burn.
Show runway with and without the new round. Show it under a flat-revenue case, not your forecast. The number partners care about is the conservative one.
Capital required per dollar of ARR.
Efficiency is the lens partners apply in 2024–2026. Spending $3 to make $1 of ARR is acceptable at seed, ugly at A, fatal at B. The trend matters more than the absolute number.
Company value before the new round.
Pre-money is what existing equity is worth before new capital comes in. Founders sometimes prefer to negotiate on pre-money to preserve clarity on dilution.
Simple Agreement for Future Equity. The standard pre-seed instrument.
A SAFE converts to equity at the next priced round. Post-money SAFEs are now standard. Stack too many at different caps and you get a dilution surprise. Model the conversion before stacking.
A percentage off the next round's price for early investors.
A 20% discount means a SAFE holder pays 80% of what new investors pay. SAFEs often have both a cap and a discount; investors get the better of the two at conversion.
A small raise between priced rounds.
Bridges signal something. Either a milestone slipped or a strategic pivot. Investors read the framing carefully. A 'bridge to default alive' is fine. A 'bridge to next round' is suspect.
How much ownership you give up in a round.
A clean priced round dilutes 15–25%. Pre-seed founders often leave 30%+ on the table across stacked SAFEs without modeling it. Build the cap table forward through Series A before signing anything.
The fund that sets terms and writes the largest check.
The lead does diligence, sets price, and pulls the round together. Other investors take signal from the lead. Your job in fundraising is to find one. The rest follows.
Exclusivity clause stopping you from talking to other investors.
Standard no-shop windows are 30–45 days. Don't sign a longer one. Signing a no-shop without a clear path to close is how rounds die quietly.
The right to maintain ownership in future rounds.
Investors with pro rata rights can buy enough of the next round to keep their percentage. Founders trade these rights carefully. They affect Series B+ allocations.
Who gets paid first, and how much, at exit.
1x non-participating is standard at seed and A. Anything above 1x or 'participating' is a red flag at venture stage. It quietly transfers value from common to preferred at exit.
A formal vote on company decisions.
Most seed leads take a board seat. At Series A it's standard. Independent directors come at A or B. The rule of thumb: board size = stage. Three at A, five at B.
Go-to-market. How you actually sell.
GTM is motion, not strategy. PLG, sales-led, channel. Pick one and prove it before the round. Investors don't fund three motions at seed.
Product-led growth. The product does the selling.
PLG works when time-to-value is short, the user is the buyer, and viral or self-serve loops compound. It does not mean 'no sales team.' Most PLG companies layer sales onto a self-serve base.
Market size built from unit economics, not analyst reports.
Number of accounts × price × attach rate. If you can name each input and where you got it, the slide lands. If you're citing Gartner, it doesn't.
Deals in motion, weighted by stage.
At Series A, leads ask to see pipeline by stage with close dates. Inflated pipeline (everything 90% likely) destroys credibility. Weight conservatively.
Non-binding statement of customer interest.
LOIs are weaker signal than paid pilots. Investors discount them heavily. Convert to paid before raising if possible.
Shared folder of diligence materials.
Standard contents: incorporation docs, cap table, financial model, customer list, key contracts, and team bios. Have it ready before a partner meeting, not after.
An investor offers a term sheet before you're raising.
Pre-emptive offers usually come from existing investors or a fund that's been tracking you. They can be excellent or a trap. Run a quick competitive process either way.
A round priced below the previous one.
Down rounds are no longer career-ending. In 2023–2026 they're common. The narrative is everything. 'Reset and accelerate' lands. 'We had to' does not.
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