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43 Cards in this Set
- Front
- Back
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A/B Testing (or “split testing”)
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A method of testing that involves two different versions to see which is more effective (most commonly associated with web ad campaigns)
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Angel Investors
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Individuals who invest their personal capital directly in new ventures
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Barriers to Entry
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Conditions that create disincentives for other firms to enter a market
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Board of Directors
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A panel of individuals elected by a corporation’s shareholders to oversee the management of the firm
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Bootstrapping
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Using creative means to obtain resources other than borrowing money or raising capital from traditional sources
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Break-Even Point
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The point at which the initial investment is covered, generating a free cash flow
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Burn Rate
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The rate at which a company is spending its capital (until it reaches positive cash flow) [usually expressed in cash burned per month]
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Business Model
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“How an organization creates, delivers, and captures value” (Osterwalder)
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Business Model Innovation
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Generating a new business model that adds value
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Business Plan
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A written document that carefully explains every aspect of a new venture
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Cannibalization
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Reduction in the value of one product due to the release of a new product by the same company
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Capital
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The funds and assets invested in a business by the owners
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Channel
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How the product gets from your company to the customer (i.e., sales or distribution channel)
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Channel Conflict
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The problem of when separate channels (e.g., retail sales and online sales) are in conflict over selling products
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Confirmation Bias
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The tendency to overweight evidence that confirms a hypothesis and underweight or ignore evidence that refutes itf goods sold [Or: The difference between the revenues and the production costs, excluding operating expenses]
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Industry
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A class of sellers that offers products or classes of products that are similar and close substitutes
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Initial Public Offering (IPO)
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When a company issues shares to the public for the first time
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Innovation
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Translating an idea or invention into a good or service that creates value [Or: applied creativity; successful introduction of something new and useful to the market]
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Intellectual Property
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Intangible asset that consists of knowledge and ideas (e.g., patents, copyrights, trademarks, trade secrets)
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Intrapreneur
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An intra-organizational/inside entrepreneur; [“a person within a large corporation who takes direct responsibility for turning an idea into a profitable finished product through assertive risk-taking and innovation” (Gifford and Pinchot)]
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Invention
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The creation of new forms or processes; an idea made manifest
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Inventory
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A company’s raw materials and products waiting to be sold
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Lean Startup
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A startup that relies on validated learning, scientific experimentation, and iterative product releases to gain valuable customer feedback and measure progress. (Ries)
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Marginal Cost
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That amount of money one extra unit of production will add to the total cost of production
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Market
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A group of people who want or need a particular product and have the ability and willingness to pay for it
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Market Research
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The systematic gathering, recording, and analyzing of data about problems relating to the marketing of goods and services
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Market Segment
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A group of individuals or organizations with shared characteristics and similar product needs
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Multi-Sided Market
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An economic platform having multiple user groups that provide each other with network benefits. [Examples include search engines (search engine company, user, advertiser); credit cards (credit card company, merchants, and cardholders); medical devices (patients, doctors, insurers, hospitals).]er”): Income that a company receives from its normal business activities, usually from the sale of goods and services
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Seed Capital (or seed financing/seed money)
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Money used for the initial investment in a startup company [usually for proof-of-concept, market research, or initial product development]
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Social Entrepreneurship
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Applying entrepreneurship to social issues or causes [Or: Creating social transformation]
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Startup
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“A human institution designed to create a new product or service under conditions of extreme uncertainty” (Ries). [Or: “A temporary organization in search of a scalable, repeatable, profitable business model” (Blank)]
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Stock Options
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A special form of incentive compensation providing employees the option or right to buy a certain number of shares of their firm’s stock at a stated price over a certain period of time
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Substitutes
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Different products that at least partly satisfy the same needs of the consumers and therefore can be used to replace one another
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Supply Chain
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A network of all the firms that participate in the production of a product, from raw materials to sale
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Switching Costs
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The costs a consumer incurs due to changing suppliers or products. (Can be monetary, psychological, or effort- and time-based)
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Target Market
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The particular market segment at which a company is focused
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User Innovation
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New product and service development by individual users for themselves, without the assistance of producers
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Value Chain
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The string of activities that moves a product from the raw material stage through manufacturing and distribution to the customer
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Value Proposition
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The quantifiable benefits that a business promises to deliver to customers [Or: The job being done for the customer]
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Venture Capital
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Financial capital provided to startup ventures in exchange for equity ownership
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Viral
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When products or services are self-replicating due to customer referrals. [Or: Advertising or marketing dynamics that use pre-existing social networks and other technologies to produce increases in brand awareness or sales through self-replicating processes. Measured with viral coefficient.]
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Window of Opportunity
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The time period in which a firm can realistically enter a new market
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Working Capital
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Cash available for day
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