Looking for funding? Are you about to make a few appointments with angel Investors? Knowing the “business jargon” will definitely help you!
– Due diligence: Process of evaluation of a project by a potential investor based on material facts.
– Investment Readiness: A privileged moment in time when entrepreneurs are ready to meet and negotiate with business angels, as they understand what the prerequisites of the involvement of the business angel in a company are. (Also applies to other types of investors when the entrepreneur knows what is expected from the different types of financing bodies.)
– Latent angel: Rich individual who has made an angel investment, but not in the past three years.
– Mezzanine: Finance used, mainly in larger deals in profitable companies, which combines a small amount of equity with loans secured, where possible, on the company’s assets. Often used as expansion capital.
– Yield rate: The number of investment opportunities that are brought to the attention of investors (by the business angel network) and which resulted in an investment (Source: Sohl Jeffrey E. and Sommer Bruce, “Angel investing: changing strategies during volatile times”, p.9 2002).
– Virgin Angel: Individuals with funds available who are looking to make their first investment.
– Exit Route: The ways in which business angels sell their stake in an investee business. Possible exit routes include management buyouts, sale of stock to another business angel or a formal venture capital firm and—in few cases—listing on the stock market.
(Source: ΕΒΑΝ – Τhe European Trade Association for Business Angels, Seed Funds, and other Early Stage Market Players – www.eban.org)
