Market dynamics, business models, and industry factors that drive venture capital decisions.
29 terms
A startup built primarily on top of an existing AI model or API rather than developing its own foundational model.
The financial markets where long-term debt and equity securities are bought and sold, including the IPO market.
A digital economy built around individuals monetizing audiences through platforms, tools, and communities.
A private company valued at $10 billion or more — a step above unicorn status.
Startups built on significant scientific or engineering innovation that creates fundamental technological advantages.
The total amount of committed but undeployed capital available to venture capital funds, indicating the industry's capacity for future investment activity.
The growth phase after product-market fit where a startup scales operations, team, and revenue aggressively.
The tendency for VCs to follow each other into the same sectors, stages, or deals, creating bubbles and crowded investment categories.
Software products designed to serve multiple industries rather than a specific vertical.
The economic cost borne by the less-informed party in a transaction due to the other party having superior information about the asset's true value.
The market failure where information asymmetry causes high-quality deals to leave the market, leaving mostly poor-quality opportunities for less-informed investors.
A market composed of many small customer segments that collectively represent significant demand.
A state where most potential customers already use competing products.
The risk that a fund's vintage year coincides with a market peak, leading to elevated entry prices and compressed returns.
Small, niche SaaS businesses often built by solo founders.
Serviceable Addressable Market — the portion of the TAM (Total Addressable Market) that a company can realistically target and serve given its current product, geography, and business model.
Serviceable Obtainable Market — the realistic portion of SAM a company can capture in the near term given its current resources, competitive position, and go-to-market capacity.
Software as a Service — cloud-delivered software accessed via subscription, generating recurring revenue. The dominant business model in modern enterprise software.
The network of investors, founders, accelerators, universities, and service providers supporting startups.
Total Addressable Market — the total revenue opportunity available if a company captured 100% of its target market.
The percentage of each transaction a marketplace or platform retains as revenue — the fundamental monetization lever for two-sided marketplace businesses.
A prolonged downturn in venture funding, startup valuations, and tech hiring — characterized by layoffs, down rounds, and reduced VC activity.
The market disruption caused when crossover hedge funds deploy massive capital into venture at unprecedented speed and scale.
A private startup valued at $1 billion or more. The term was coined by Aileen Lee in 2013 to describe the rarity of such companies.
Growth achieved through subsidized unit economics — where each new customer or transaction loses money — justified by the expectation of future scale or market dominance.
A decrease in startup valuations during market downturns.
Software designed for a specific industry such as healthcare, construction, or finance.
The influence of macroeconomic interest rates on venture capital investment activity.
A macroeconomic environment of near-zero interest rates that historically fueled aggressive venture investing.