Startup From the Bottom
An individual who establishes a company or organization
Founder
The value added by having a product available when it is convenient for customers (e.g. specific season or hours of operation)
Time Utility
The quantity of a good or service that consumers are willing and able to purchase at various prices
Demand
What would happen over time if your investment was constantly gaining and losing by the same percentage?
You would lose money
a performance ratio used to evaluate the efficiency or profitability of an investment
ROI (return on investment)
The first time a company sells its stock to the general public on a stock exchange
Initial Public Offering (IPO)
The value added by changing raw materials or putting parts together to make them more useful (e.g., turning thread into a shirt)
Form Utility
The total amount of a specific good or service that is available to consumers
Supply
Legal rights to ownership of ideas in the industrial, scientific, literary, and artistic fields
Intellectual Property
is a way to calculate the average outcome of an investment if it were repeated many times. It helps investors quantify risk by weighing the probability of different scenarios (gains vs. losses).
Expected value (EV)
An occurrence that allows founders and investors to cash out some or all of their shares (e.g., an IPO or a merger)
Liquidity Event
The value added by having a product where customers can buy it (e.g., a gas station on a busy highway)
Place Utility
Money that has already been spent and cannot be recovered; logically, it should not influence future business decisions.
Sunk Cost
what is left from revenue after you pay for the materials
Gross Profit
When the earnings from an investment (interest, dividends, or capital gains) are reinvested to generate their own earnings
Compounded Growth
An investor who provides capital to startups or small companies that wish to expand but do not have access to equities markets.
Venture Capitalist
The value added by making it easy for the customer to take ownership (e.g., offering credit cards, financing, or easy checkout)
Possession Utility
The market state where the quantity demanded equals the quantity supplied, resulting in a stable market price.
Equilibrium
Circumstances or capabilities that put a company in a favorable or superior business position
Competitive Advantage
the money or assets used by an individual or organization to fund the purchase of income-generating assets
Investment capital
An individual or business entity that is allowed to trade securities that may not be registered with financial authorities. They must meet specific income or net worth requirements.
Accredited Investor
The value added by communicating with the consumer (e.g., manuals, labels, or advertising)
Information Utility
The value of the next best alternative that is given up when making a choice.
Opportunity Cost
Often called "The Bottom Line," this is the total amount of money left over after all operating expenses have been paid
Net Income
is the portion of the business that you actually "own" if you sold all the assets and paid off all the debts
owner’s equity