[GROUP 6] NEW BUSINESS

Startup that reaches and exceeds a billion dollar valuation is called

• Dragon

• Unicorn

• Dinosaur

• Eagle

Startup that raises over one billion dollars in one single round of funding is called

• Dragon

• Unicorn

• Dinosaur

• Eagle

The percentage of customers who cancel a service in a certain time period

• Burn rate

• Run rate

• Churn rate

• Retention rate

The rate measures the number of customers a company retains over a given period of time

• Run rate

• Churn rate

• Burn rate

• Retention rate

The amount of money that the startup will spend over a predetermined period

• Churn rate

• Burn rate

• Run rate

• Retention rate

The financial performance of a company, using current financial information as a predictor of future performance is called

• Retention rate

• Burn rate

• Run rate

• Churn rate

Calculate an annual run rate (ARR)

Monthly Revenue * 12 Months = Annual Run Rate

Quarterly Revenue * 4 Quarters = Annual Run Rate

If a business produces $20,000 in sales during its first month, you could multiply that number by 12 to get an ARR of $240,000. However, if that same business followed that up with $18,000 in sales their second month and $15,000 in their third month for a total of $53,000 in first-quarter earnings, so what is their ARR now?

Their ARR now is:

= ($20,000 + $18,000 + $15,000) x 4

= $53,000 x 4

= $212,000

Individuals who seek to invest at the early stages of startups, often with their own money. Their funds support and carry the company through its difficult early stages.

• Angel investors

• Accelerators

• Incubators

• Venture capitalists

Private equity investors that provide capital to companies with high growth potential in exchange for equity stake

• Angels investors

• Accelerators

• Venture capitalists

• Incubators