In continuation of our Series on various important terms used in Start-up , here we are sharing our series-2 comprising of important terms used by industry and vital for any startup to model their business accordingly.
| S. No. | Startup Term | Meaning |
| 22 | Exercise period | It means that when you leave the company or this startup then with all your ESOPs, how much time will you get to convert those options in to actual stocks. This is a very important determinant that if this period is small , then you will have to buy those stocks with your own money, which you would not want to do. If this period is long, then it allows, you to wait for a time when you will get a chance to sell it to someone, then you would want to convert those options in to stocks, because that is what makes economic sense. |
| 23 | Exercise price | When you get ESOPs, you get them at a exercise price which means they are not free. Usually, the startup charge a very nominal amount, Rs.10 per ESOP. But there could be companies, that give you a discount on their current stock price, especially if it is publically listed. |
| 24 | Exit | It means that an investor invested in your startup and at some point of time which is usually between 7-10 years, they will want a return on their money through an exit. Exit could be an IPO or it could be a sale or acquisition or it could be a merger, but this is usually the time period that the investors wait for before they want their money back. |
| 25 | Freemimum | It means that your product adopts a pricing strategy in which some features are completely free for everybody, but to get more and richer features, you have to pay a certain amount. Freemium is a combination of the Free and Premium. |
| 26 | GVM- Gross Merchandise Value | It is used a lot in E-Commerce companies, It basically represents the MRP of all the products that you have sold cumulatively. It gives a sense of whatever merchandise or products that you are selling, what is the total cumulative value. |
| 27 | GTM- Go to Market Strategy | It means that whenever you will be launching your product, its not like people are eagerly waiting for your products, so you need to adopt a GTM or Go To Market strategy , which means , how will you ship the product our in the market?How will people get to know of the product? How will they give a feedback? How will they pay for the product? All these things are part of the GTM or Go To market Strategy |
| 28 | Incubator | It’s a place where your start-up incubates or nurtures in a way. They help with ideation, they help with mentoring, they help with coaching, they help even with funding, so these are incubators or they are also called accelerators such as Y Combinator. They basically are a great way for you to start your start up through the expertise of the people who have already done that. |
| 29 | IPO- Initial Public Offering | One of the exit possibilities for a startup and its investors is to do an IPO and become Publically listed company. |
| 30 | Landing Page | It means if any customer sees your ad anywhere on a digital format and they click on that ad, where do they go to as the URL or the webpage is called the landing page they land on it. On that page all the value propositions of your products should be mentioned correctly which will then allow startup to convert. |
| 31 | LTV- Life Time Value | It is a very interesting term. It basically shows when you acquire a customer, what do you think how much value would you be able to extract from them in their lifetime. For finding this out one has to plot the retenttion of that customer, you have to gauge when will the customer return and when the customer returns, how much would they spend, when will they return? So there are lot of parts that go into the measurement, but LTV is an important metric for any start-up specially during the time of investing. |
