The bunch glossary

Anchor Investor

A major early investor whose large commitment helps launch a fund and attract additional investors.

Bridge Financing

Short-term funding used to meet immediate cash needs until longer-term financing or a liquidity event occurs.

Bridge Round

A temporary financing round used to provide a company with enough capital to reach the next funding stage or major milestone.

Deal Memo

A document summarising the key terms and conditions of an investment, often used to facilitate discussion and negotiation between investors and companies.

Down Round

A financing round in which a company raises capital at a lower valuation than in previous rounds, diluting existing shareholders' ownership stakes.

Equity

Ownership interest in a company, typically represented by shares of stock or other securities.

Equity Round

A financing round in which a company raises capital by issuing new shares of stock to investors.

Exit

The process by which an investor realizes gains or losses on an investment, typically through a sale, merger, acquisition, or initial public offering (IPO).

Final Close

The point when a fund’s fundraising ends and no further investor commitments are accepted.

First Close

The initial stage of fundraising when a fund accepts its first investor commitments and begins operations.

Hard Cap

The maximum amount of capital a fund will accept from investors.

Initial Public Offering (IPO)

The process through which a private company sells shares to the public and becomes listed on a stock exchange.

Placement Agent

An intermediary that helps fund managers raise capital by introducing them to potential investors.

Round

A stage in the funding process of a private equity or venture capital investment, typically characterized by a specific amount of capital raised or a specific set of investment terms.

Round Size

The amount of capital raised during a particular funding round of a private equity or venture capital investment.

Runway

The amount of time a company can sustain its operations with its current cash resources.

Secondary Market

A market for buying and selling existing securities or assets, rather than newly issued ones.

Secondary Transaction

The buying or selling of an existing investment, rather than making a new investment.

Soft Cap

A fundraising target a fund aims to reach, with flexibility to raise more capital up to a hard cap.

Term Sheet

A document outlining the key terms and conditions of a potential investment, typically used as a basis for negotiations and due diligence.

Unfunded Commitment

The portion of an investor’s committed capital that has not yet been called by the fund.

Venture Round

A funding round in which a venture capital firm invests in a company, typically in exchange for equity.