Entrepreneur Dictionary for Startups

The entrepreneur dictionary for startups contains terms and definitions commonly used by entrepreneurs, investors, accelerators, and others who interact with startup ventures and startup financing.
For more entrepreneur resources check out our Acronyms for Startups, Infographics, or Startup FAQ.

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M&A - Mergers & Acquisitions

MAC - Material Adverse Change

Mafia - In the context of angel funding and startups, a colloquial term used to describe the loose association of people previously involved with a highly successful technology company, such as Google, Facebook, Paypal or LinkedIn, as founders, early employees or investors.⁶

Main Street Business - A term utilized to reference small traditional family lifestyle businesses such as local retail and service providers. These businesses are typically operated by family for the benefit of the family without the objective of a liquidation event such as the strategic sale or IPO of the company. As a result, these businesses are not typically funded by angel investment groups or VCs.⁶

Major Investor - As used in investment term sheets, any investor who puts in more than a defined amount into a given round and is therefore entitled to specific information and / or voting rights.⁷

Majority - The percentage defining the level of shareholders that must approve significant company actions such as borrowing money, or acquiring or merging with another business; typically defined to be 50.1% or greater.⁶

Management Buy-in - Management buy-in is the purchase of a business by an outside team of managers who have found financial backers and plan to manage the business actively themselves.⁹
- Synonyms: MBI

Management Buy-out - Management buy-out is the term used for the funds provided to enable operating management to acquire a product line or business, which may be at any stage of development, from either a public or private company.⁹
- Synonyms: MBO

Management Fee - Compensation typically paid annually from an investment fund to the general partner or investment advisor of the fund to cover administration costs, expenses related to investor relations and to compensate them for their services and expertise.⁶

Management Team - The individuals who oversee and manage the operations and activities of a startup company or angel / venture capital fund.⁶

Market - Based on supply and demand, this term refers to the societal arrangement whereby consumers purchase goods and services from businesses and individual sellers in exchange for currency. In economic relevance, the “market” can be divided into different industries, such as biotechnology, food, etc. The exchange between the consumer and seller contribute to a society’s market economy which greatly depends on these transactions for economic viability.⁴

Market Capitalization - The total dollar value of all outstanding shares. Computed as shares multiplied by current price per share. Prior to an IPO, market capitalization is arrived at by estimating a company’s future growth and by comparing a company with similar public or private corporations. (See also: Pre-Money Valuation.)³

Market Channel - The resources and processes necessary to facilitate the transfer of ownership of goods and / or services from the point of production to the point of acquisition by the consumer. ⁶

MBI - Management Buy-in

MBO - Management Buyout

Meetup - A website which enables the facilitation of online in-person meetings of groups with similar interests. Local Meet-ups groups focus on a wide variety of interests, including technology, entrepreneurship, investments and startups from the entrepreneurial world.⁶

Merger - A combination of business entities under which efficiency improvements are expected to be achieved from potential synergies by eliminating duplicate factors of production such as plant, equipment and labor and by the more efficient use of capital driving increases in revenues and profits in the resulting company.⁶

MESBIC - Minority Enterprise Small Business Investment Companies

Mezzanine Debt - Mezzanine debts are debts that incorporates equity-based options, such as warrants, with a lower-priority debt. Mezzanine debt is actually closer to equity than debt, in that the debt is usually only of importance in the event of bankruptcy. Mezzanine debt is often used to finance acquisitions and buyouts, where it can be used to prioritize new owners ahead of existing owners in the event that a bankruptcy occurs.⁵

Mezzanine Financing -

A blend of debt and equity financing, requiring no collateral and does not necessarily involve giving up interest in the company. This capital is typically used to fund growth or to enable management to buy out company owners for succession purposes. The interest rate is high, ranging from 20-30% and lenders can convert their stake to equity or ownership in the event of default.²
Refers to the stage of venture financing for a company immediately prior to its IPO. Investors entering in this round have lower risk of loss than those investors who have invested in an earlier round. Mezzanine-level financing can take the structure of preferred stock, convertible bonds, or subordinated debt.³
Mezzanine Financing is a late-stage venture capital, usually the final round of financing prior to an IPO. Mezzanine Financing is for a company expecting to go public usually within 6 to 12 months, usually so structured to be repaid from proceeds of a public offerings, or to establish floor price for public offer.⁵

Mezzanine Level - Mezzanine level is a term used to describe a company which is somewhere between startup and IPO. Venture capital committed at mezzanine level usually has less risk but less potential appreciation than at the startup level, and more risk but more potential appreciation than in an IPO.⁹

MF - Management Fee

Micro-VC - The correct term for organizations often referred to as super angels. Structured similar to a traditional venture fund, a Micro-VC is typically much smaller in size, with fewer partners, and invests less money but at an earlier stage.⁷

Minority Enterprise Small Business Investment Companies - Minority Enterprise Small Business Investment Companies or MESBICs are government-chartered venture firms that can invest only in companies that are at least 51 percent owned by members of a minority group.⁵
- Synonyms: MESBICs, MESBIC

MoM - Month over Month

Month over Month - A financial comparison which examines a specified performance factor for a specified month with the same performance factor for the previous month. Month over Month comparisons can can be direct comparing the actual performance factors, or differences between the factors in either absolute or percentage terms.⁶
- Synonyms: MoM

Monthly Active Users - Distinct website users who engage with a site's offerings or services in a given month.⁶

MRR - Monthly Recurring Revenue

MSP - Multi-sided Platform

MTD - Month to Date

Mutual Fund - A mutual fund, or an open-end fund, sells as many shares as investor demand requires. As money flows in, the fund grows. If money flows out of the fund, the number of the fund’s outstanding shares drops. Open- end funds are sometimes closed to new investors, but existing investors can still continue to invest money in the fund. In order to sell shares, an investor usually sells the shares back to the fund. If an investor wishes to buy additional shares in a mutual fund, the investor must buy newly issued shares directly from the fund. (See also: Closed-end Funds.)³

MVP - Minimal Viable Product

Notes: