Startup Glossary Every Founder Should Know
In the dynamic world of startups, language is as crucial as vision. The right words can open doors to funding, partnerships, and user trust, while misunderstandings often lead to costly mistakes. For founders—especially those new to tech or building inclusive teams—it’s vital to master the terminology that defines the landscape. Whether you’re pitching, building, hiring, or learning, this glossary offers not just definitions but also the context behind each term, helping you navigate with confidence and empathy.
Core Startup Terms
MVP (Minimum Viable Product)
The MVP is the simplest version of a product that solves a core problem for early adopters. It’s not about launching a half-finished idea; it’s about identifying the essential features that demonstrate value and trigger feedback. For neurodivergent founders and teams, building an MVP can be a mindful process, allowing for iterative learning and reducing the pressure of perfection. Remember: Done is better than perfect, especially in the beginning.
Runway
This represents the amount of time a startup can operate before running out of money, based on current expenses. Calculating runway is not just a financial exercise—it’s a survival tactic. The longer the runway, the more time a team has to experiment, learn, and adapt. In environments where women or neurodivergent founders face additional challenges in fundraising, understanding and extending runway can make a profound difference.
PMF (Product-Market Fit)
Achieving PMF means your product satisfies a strong market demand. It’s often described as the moment when customer pull for your product becomes undeniable. Teams might feel it in the form of growing waitlists, positive user feedback, or organic growth. Without PMF, scaling is like trying to build a skyscraper on sand.
CAC (Customer Acquisition Cost)
CAC measures what it costs to acquire a new customer, factoring in marketing, sales, and related expenses. For early-stage startups, keeping CAC low is crucial. This is especially important for teams with limited resources, or those prioritizing accessibility and inclusion over aggressive ad spends.
LTV (Lifetime Value)
LTV estimates the total revenue a company expects to earn from a single customer throughout their relationship with the product. The LTV/CAC ratio is fundamental—if it costs more to acquire a customer than they bring in, long-term sustainability is at risk.
Funding & Equity Explained
Dilution
Dilution occurs when a company issues new shares, decreasing existing owners’ percentage of ownership. Founders should be aware of how investment rounds dilute their stake, especially over multiple fundraising events. The impact is both financial and psychological—holding onto your vision while sharing control.
SAFE (Simple Agreement for Future Equity)
A SAFE is a contract between a startup and an investor, allowing the investor to convert their investment into equity at a future date, typically upon a subsequent funding round. SAFEs are designed to streamline early-stage investments, offering flexibility without the legal complexity of traditional equity rounds.
A SAFE isn’t a loan—there’s no interest or maturity date. It’s a handshake for future partnership, rooted in trust and shared belief in the venture’s potential.
Term Sheet
A term sheet is a non-binding agreement outlining the terms and conditions of an investment. It covers valuation, investor rights, board structure, and more. Understanding the language of term sheets—liquidation preference, anti-dilution, vesting—empowers founders to negotiate from a place of knowledge, not fear.
Other Essential Concepts
Cap Table (Capitalization Table)
A cap table is a spreadsheet or tool that lays out who owns what percentage of the company. It includes founders, investors, employees, and anyone with equity or options. Keeping an up-to-date and accurate cap table is essential for transparency and future fundraising.
Vesting
Vesting schedules determine when founders or employees earn their equity. This protects the company if someone leaves early. A common vesting schedule is four years with a one-year cliff, ensuring commitment before ownership is fully granted.
Pivot
To pivot is to fundamentally shift business strategy in response to new insights or market realities. Pivots are not failures—they are signs of adaptability. For teams led by women or neurodivergent individuals, pivots can reflect unique strengths in empathy and flexibility.
Burn Rate
The rate at which a startup spends its cash. A high burn rate can be dangerous, but sometimes necessary for rapid growth. Monitoring burn rate closely is an act of stewardship—protecting the team’s future, not just the company’s finances.
Building Teams & Culture
ESOP (Employee Stock Option Plan)
An ESOP grants employees the right to purchase company shares at a set price. ESOPs are powerful tools for attracting and retaining talent, especially in competitive markets. For inclusive teams, they also demonstrate a commitment to shared success.
Onboarding
Onboarding is more than paperwork. It’s the structured process of integrating new hires into your culture, tools, and mission. Thoughtful onboarding is especially important for neurodivergent team members, who may benefit from clear communication and supportive resources.
Diversity & Inclusion (D&I)
These principles guide hiring and management practices to ensure that people of different genders, backgrounds, and neurotypes have opportunities to thrive. D&I is not a checkbox—it’s a mindset that shapes everything from recruitment to product design.
Inclusive teams build products that reflect the real world, not just a narrow slice of it.
Remote-First
A remote-first startup prioritizes location independence for all employees. This approach opens doors for talent often overlooked by traditional hiring and supports better work-life integration, especially for caregivers, parents, and neurodivergent professionals.
Product & Growth Metrics
KPI (Key Performance Indicator)
KPIs are measurable values that demonstrate how effectively a company is achieving key objectives. For startups, these might include monthly active users, churn rate, or net promoter score. Selecting the right KPIs means focusing on what truly matters to your mission—not just what looks good in a pitch deck.
Churn Rate
The percentage of customers who stop using your product during a given period. High churn signals a need for change, while low churn indicates satisfaction and product stickiness. Understanding churn is essential for sustainable growth.
ARR (Annual Recurring Revenue)
ARR is a metric for subscription-based businesses, representing the predictable income generated annually from customers. Tracking ARR helps founders gauge long-term viability and plan for growth with confidence.
MoM (Month-over-Month Growth)
MoM growth measures changes in a specific metric—such as revenue or users—from one month to the next. It’s a quick pulse check on the health and momentum of a startup.
Startup Ecosystem & Funding Stages
Incubator
An incubator provides startups with resources like mentorship, office space, and sometimes funding, often in exchange for equity. Incubators are particularly valuable for first-time founders or those seeking community and structure.
Accelerator
Accelerators are time-bound programs that support startups with investment, mentorship, and networking, culminating in a demo day. The atmosphere is fast-paced and intensive, designed to speed up growth and readiness for fundraising.
Angel Investor
An angel investor is an individual who invests personal funds in early-stage startups. Angels often provide more than capital—they offer mentorship and connections, which can be especially transformative for underrepresented founders.
Venture Capital (VC)
VCs are firms that invest pooled funds into startups with high growth potential. Unlike angels, VCs typically invest larger sums and get more involved in governance.
Seed Round
The first formal round of funding, used to prove out the idea and build the MVP. Seed funding can come from friends, family, angels, or early-stage VCs. Understanding the expectations at this stage is crucial—often, investors are betting on the team as much as the product.
Series A, B, C…
Subsequent rounds of funding, each with increasing expectations for growth, traction, and market fit. Each round usually involves more rigorous due diligence and negotiations around valuation and control.
Legal, Compliance & Responsibility
IP (Intellectual Property)
IP covers creations of the mind, such as inventions, designs, and brand names. Protecting IP is essential, especially in tech where ideas are currency. For founders from underrepresented backgrounds, IP can also be a critical asset in leveling the playing field.
GDPR (General Data Protection Regulation)
A European Union regulation that sets strict rules for data privacy and user consent. Compliance is not optional—violations can be costly. Building privacy-first products earns user trust and reflects a commitment to ethical technology.
Respecting user data is no longer just good practice—it’s a competitive advantage.
Due Diligence
The process investors use to investigate and verify a startup’s business, finances, and legal standing before investing. Being organized and transparent during due diligence can accelerate funding and build trust.
Exit
An exit is when founders and investors realize returns on their investment, typically through an acquisition or IPO. Planning for exit is not about giving up; it’s about maximizing impact and value for all stakeholders.
The Human Side of Startups
Behind every term, there are stories—of risk, resilience, and reinvention. For women and neurodivergent founders, language can be a tool of empowerment, breaking down barriers and building bridges. When you understand the vocabulary, you can ask better questions, negotiate with confidence, and build teams that reflect the diversity of the world we live in.
As the startup landscape continues to evolve, so will the language. Staying curious, open, and kind—to yourself, your team, and your users—will serve you far beyond any glossary. The journey is challenging, but you are not alone. May these words be a compass as you shape the future of technology and education—one inclusive, courageous step at a time.
