Startup Terms

23 Feb 2025

Gross Sales

Gross Sales represent the total revenue a company generates from sales before any deductions.

Net Sales

Net Sales are the actual revenue a company earns after deducting returns, discounts, and allowances from gross sales.

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20 Feb 2025

Registrar of Companies (ROC)

The Registrar of Companies (ROC) is a government authority responsible for registering and regulating companies under the Companies Act in a country.

RTGS

RTGS (Real-Time Gross Settlement) is a payment system that allows instant and high-value fund transfers between banks. Payments are settled in real-time without any delays.

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17 Feb 2025

Vertical Integration

Vertical Integration is a business strategy where a company expands its operations by controlling more stages of its supply chain, either upstream (towards raw materials) or downstream (towards end customers).

Distressed Inventory

Distressed Inventory refers to unsold goods that are at risk of losing their value due to overstocking, expiration, or obsolescence. Businesses often sell distressed inventory at deep discounts to minimize losses.

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14 Feb 2025

Commodity

A commodity is a raw material or primary agricultural product that is interchangeable with other goods of the same type. Commodities are usually standardized, mass-produced, and traded in bulk.

Basket Selling

Basket Selling is a sales strategy where multiple related products are grouped together and sold as a bundle to increase customer spending and convenience.

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11 Feb 2025

Moat (Competitive Advantage)

A moat in business refers to a company's sustainable competitive advantage that protects it from competitors and ensures long-term profitability. It helps a company maintain market dominance and higher profit margins.

Discounted Cash Flow

Discounted Cash Flow (DCF) is a valuation method used to estimate the present value of a company or investment based on its future cash flows. The method accounts for the time value of money by discounting future earnings to today’s value.

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22 Feb 2025

Sleeping Founder

A Sleeping Founder is a co-founder who is no longer actively involved in the company’s day-to-day operations but still holds equity or rights in the business.

Director Identification Number

A Director Identification Number (DIN) is a unique identification number assigned to directors of companies by the government. It is mandatory for anyone who wants to become a director in a registered company.

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19 Feb 2025

Retention Marketing

Retention Marketing focuses on keeping existing customers engaged and encouraging repeat purchases. The goal is to build long-term customer relationships and increase lifetime value (LTV).

Performance Marketing

Performance Marketing focuses on driving measurable results such as clicks, leads, conversions, or sales. Advertisers pay only when a specific action is completed (e.g., per click or per sale).

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16 Feb 2025

Market Skimming

Market Skimming is a pricing strategy where a company sets a high initial price for a new product and gradually lowers it over time. This approach helps recover development costs and maximize early profits before competitors enter the market.

Secondary Market

The Secondary Market refers to a market where pre-owned or previously issued products, stocks, or assets are resold. Unlike the primary market, where products are sold for the first time, the secondary market allows buyers to purchase from other individuals or investors.

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13 Feb 2025

Total Addressable Market

Total Addressable Market (TAM) refers to the total revenue opportunity available if a company were to achieve 100% market share in a specific industry or segment. It helps businesses understand their growth potential and set realistic goals.

C&F Agent

A C&F Agent (Carrying & Forwarding Agent) is a logistics partner who handles distribution, storage, and transportation of goods for manufacturers. They act as a link between companies and distributors or retailers.

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10 Feb 2025

Convertible Note

A Convertible Note is a short-term loan given to a startup by investors, which later converts into equity (shares) instead of being repaid in cash. It is commonly used in early-stage funding when the company’s valuation is uncertain.

Cash Credit Limit

A Cash Credit Limit (CC Limit) is a short-term borrowing facility provided by banks to businesses, allowing them to withdraw funds as needed, up to a specified limit. It helps businesses manage working capital requirements

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21 Feb 2025

Cash Accounting

In Cash Accounting, transactions are recorded only when cash is received or paid. It is a simple method mainly used by small businesses and freelancers.

Accrual Accounting

In Accrual Accounting, transactions are recorded when they occur, even if cash hasn’t been received or paid yet. It provides a more accurate picture of a company’s financial health.

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18 Feb 2025

Average Order Value (AOV)

Average Order Value (AOV) is the average amount spent per order in a given time period. It helps businesses understand customer spending habits and optimize pricing strategies.

Average Selling Price (ASP)

Average Selling Price (ASP) is the average price at which a single unit of a product is sold over a given time. It helps businesses evaluate pricing strategies and product profitability.

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15 Feb 2025

General Trade (Traditional Retail)

General Trade refers to traditional retail stores, such as small neighborhood shops, kirana stores, and mom-and-pop stores. These stores operate independently without structured supply chains.

Modern Trade (Organized Retail)

Modern Trade refers to organized retail formats, such as supermarkets, hypermarkets, and large chain stores, that follow structured supply chains and use technology for operations.

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12 Feb 2025

Anti-Dilution Clause

An Anti-Dilution Clause is a provision in investment agreements that protects early investors from having their ownership percentage reduced when a company issues new shares at a lower price (down round).

Lifetime Value

Lifetime Value (LTV) refers to the total revenue a business expects to earn from a single customer throughout their relationship with the company. It helps in marketing budget allocation and customer retention strategies.

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9 Feb 2025

ARR

Annual Recurring Revenue (ARR) is a key financial metric for subscription-based businesses, representing the predictable and recurring revenue generated annually from subscriptions.

Vertical Scaling

In a business growth context, Vertical Scaling refers to expanding a company by deepening its market presence, enhancing its offerings, and optimizing internal operations instead of entering new markets or diversifying into different products. It focuses on strengthening core competencies and growing within an existing business model.

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