List of terms, questions and notes for reference. Will just dump here for easy searching w/ cmd+f
What is a PVP
Principal or VP. See Pods & Heirarchy for more info.
Pods & Heirarchy
Teams are broken up into pods of analysts, associates and VP's. The pods all report to a Principal/Partner, but
they're not usually involved in the day to day matters, instead pods are generally led by VP's.
Analyst -> Associate -> VP -> Principal/Partners
What are Lead Sponsors
Reserved for investors that have a majority stake in a company.
Very useful to know, especially if the investor is a competitor.
What are Deal Types - (Artemis, PIPE, VC-Backed)
- Artemis, named after the goddes of the hunt, is a term used for hidden gem companies. These companies are decently scaled, generating revenue (ideally growing), and have little to no previous funding.
- PIPE (Private Investment In Public Equity) is when an investor buys stock directly from a public company below market price. This is how TCV invested in Netflix. Read more
- VC-Backed is the typical type of deal, where a private company is already raising funds with VC's.
Example Investment Summary
$30M, growing YoY, CEO likes TCV, etc…
DEPRECATED TERMS
What is H&M?
Stands for "Hearts & Mind"... which is an interest level reserved for the top 20 companies. `
What is BPC?
Stands for "Best Private Companies"... which is an interest level reserved for the top 100 companies.~~ - Will soon be deprecated.
What is a VC - Venture Capitalist
Investors who provide financing to start-ups or small companies that are looking to expand. Venture capitalists are usually formed as limited partnerships where the partners invest in the VC fund. The fund normally has a committee that is tasked with making investment decisions.
What is an LP - Limited Partner
Investors in a VC fund are referred to as LP's.
2 & 20
Compensation structure where 2% represents a management fee applied to the total assets and
20% is a performance fee applied to profits and is divided amongst those who have carry.
Typically the 2% covers staff salaries and all operating expenses. The 20% is used to reward key
executives and portfolio managers. Read more
MOIC - Multiple On Invested Capital
Allows investors to measure how much value an investment has generated. It's a gross metric, meaning that
it is calculated before fees and carry. MOIC = (Realized Value + Unrealized Value) / Total Invested
Read more
IRR - Internal Rate of Return
The annual rate of growth that an investment is expected to generate.
Generally speaking, the higher an internal rate of return, the more desirable an investment is to undertake.
IRR is uniform for investments of varying types and, as such, can be used to rank multiple prospective investments
or projects on a relatively even basis. In general, when comparing investment options with other similar
characteristics, the investment with the highest IRR probably would be considered the best.
Read more
EBITDA - Earnings before interest, tax, depreciation and amortization
A measure of a company's operating performance. Essentially, it's a way to evaluate a company's
performance without having to factor in financing decisions, accounting decisions or tax environments.
Read more
TAM - Total Addressable Market
Term used to reference the revenue opportunity available for a product. Serves as a quick metric of the
underlying potential of a given opportunity. Can estimate how much of the market any company can gain if
there were no competitors. Read more
TAM vs SAM vs SOM
- Total addressable market (TAM), or total available market, is the total market demand for a product or service, calculated in annual revenue or unit sales if 100% of available market is achieved.
- Serviceable available market (SAM) is the portion of TAM targeted and served by a company's products or services.
- Serviceable obtainable market (SOM), or share of market, is the percentage of SAM which is realistically reached.
P&L - Profit and Loss Statement
Financial statement that summarizes the revenues, costs, and expenses incurred during a specified period. This, along with balance sheet and cash flow statements, are issued quarterly and annually by every public company. Synonymous w/ income statement. Read more
CIM - Confidential Investment Memorandum
Document used in M&A that provides a prospective buyer with information to generate an initial offer. Does not include a purchase price, but will provide important information including business operations, financial statements, management team, and other data. Interested buyers must sign an NDA since the information is highly confidential. Read more.
M&A - Mergers & Acquisitions
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NEED TO CONFIRM - FTE - Full-time equivalent
A unit that indicates the workload of an employed person in a way that makes workloads or class loads comparable across various contexts. FTE is often used to measure a worker's or student's involvement in a project, or to track cost reductions in an organization
https://corporatefinanceinstitute.com/resources/knowledge/trading-investing/venture-capital-fund/
https://corporatefinanceinstitute.com/resources/knowledge/trading-investing/hedge-fund/
https://corporatefinanceinstitute.com/resources/knowledge/trading-investing/venture-capitalists/