—Glossary
Fundraising terminology
Definitions for terms used across CapSignal and our resources.
- ADV filing
- SEC Form ADV — public registration for investment advisers; source for CapSignal firm data.
- Agent startup
- Company building AI agents for workflows; distinct investor list from infra or vertical AI.
- Angel investor
- Individual investing personal capital, often at Pre-seed and Seed.
- ARR
- Annual recurring revenue — key SaaS metric for Seed investors.
- Blast outreach
- Identical email to hundreds of investors; low reply rates and deliverability risk.
- Burn multiple
- Net burn divided by net new ARR — efficiency metric investors watch.
- Campaign
- One fundraising outreach effort with a defined match pool, sequences, and timeline.
- Cap table
- Ownership breakdown across founders, employees, and investors.
- Carry
- GP share of fund profits — CapSignal does not charge carry.
- Check size
- Typical investment amount an investor or fund deploys per deal.
- Co-investor
- Another fund investing alongside in the same round.
- Cold outreach
- Email to investors without prior warm introduction.
- Conversion funnel
- Sent → opened → replied → meeting → diligence → close.
- Data flywheel
- AI moat from proprietary data improving model or product over time.
- Data room
- Secure folder of diligence materials—deck, model, cap table, legal docs.
- Day 0 email
- First touch in an investor sequence — highest scrutiny from recipients.
- Deployment signal
- Evidence an investor is actively writing checks—recent investments, follow-ons, or fund close announcements.
- Design partner
- Early customer collaborating before full product — traction signal at Pre-seed.
- Diligence
- Investor review of metrics, references, legal, and product before term sheet.
- Dilution
- Ownership reduction from new investment and option pool expansion.
- DMARC
- Email authentication policy complementing SPF and DKIM.
- Dry powder
- Unallocated capital in a fund available for new investments.
- Engagement signal
- Reply patterns, subject line performance, and send timing data from prior campaigns.
- Exclusion list
- Investors flagged to never receive outreach—conflicts, prior passes, existing relationships.
- Extension round
- Additional capital within same priced round or on SAFE.
- Follow-on
- Additional investment in an existing portfolio company—signals sector conviction.
- Foundation model
- Large pretrained model — infra-layer AI category.
- Fund vintage
- Year a fund started investing — affects deployment urgency.
- GP
- General partner — decision-maker at a venture fund.
- Hot intro
- Strong endorsement from trusted mutual connection.
- Inference cost
- Per-request or per-user cost to run AI models — key AI unit economics.
- Intro path
- Mutual connection route to a target investor.
- Lead investor
- Primary investor setting round terms and often taking the largest check.
- Lead magnet
- Free resource offered to capture founder email — e.g. investor list guide.
- LP
- Limited partner — capital provider to a venture fund.
- Match pool
- AI-ranked set of target investors scored before campaign launch.
- Match score
- CapSignal's 0–100 ranking of investor fit for your specific raise, with written rationale.
- Meeting conversion
- Percentage of replies that become scheduled calls.
- Micro-VC
- Small fund writing Pre-seed and Seed checks, often $250K–$2M.
- Mutual connection
- Person linked to both founder and investor on LinkedIn or portfolio graph.
- NDA
- Non-disclosure agreement — sometimes requested before data room access.
- No-shop
- Term sheet clause limiting founder from soliciting other offers for a period.
- One-pager
- Single-page company summary for investors post-meeting.
- Open rate
- Percentage of recipients who open an outreach email.
- Option pool
- Equity reserved for employee grants — often expanded at Seed.
- Outreach batch
- Group of investors contacted in the same send window.
- Party round
- Raise with many small investors and no clear lead—often harder to close.
- Pass email
- Investor decline — extract reason for future targeting.
- Pipeline fiction
- Inflated CRM stages without real investor engagement.
- Portfolio overlap
- Shared investments between target investor and comparable companies.
- Pre-emptive offer
- Investor term sheet before formal fundraise process.
- Pro-rata
- Right to invest in future rounds to maintain ownership.
- Raise profile
- CapSignal input: stage, sector, traction, target amount, preferences.
- Reply detection
- Automatic pause of sequence when investor responds.
- Reply rate
- Percentage of contacted investors who respond by email. Tracked per campaign from your outreach data.
- SAFE
- Simple Agreement for Future Equity — common Pre-seed instrument.
- Second meeting
- Partner + associate or full partnership — diligence signal.
- Send throttling
- Limiting daily email volume to protect domain reputation.
- Send window
- Optimal days/times for outreach based on investor timezone and historical open data.
- Sequence
- A multi-step outreach cadence (typically 3–5 emails) sent to one investor over 2–3 weeks.
- Series A crunch
- Gap between Seed metrics bar and Series A expectations.
- Signal layer
- One of four data categories—deployment, thesis, engagement, network—used in scoring.
- Signal refresh
- Nightly recalculation of investor activity scores from new data.
- SPF/DKIM
- Email authentication records that improve deliverability when sending from your domain.
- Spray and pray
- High-volume untargeted outreach — avoid.
- Syndicate
- Multiple investors participating in one round.
- Term sheet
- Non-binding document outlining investment terms before definitive agreements.
- Term sheet
- Outline of investment terms before definitive docs.
- Thesis drift
- When investor's actual deals diverge from stated focus.
- Thesis fit
- Alignment between an investor's stated sector/stage focus and your company's category and round.
- Thesis hook
- Opening line referencing investor's portfolio or focus.
- Trial period
- CapSignal 7-day free trial before monthly billing.
- Unit economics
- Revenue and cost per customer or transaction.
- Valuation cap
- SAFE ceiling for conversion price in future priced round.
- Vertical AI
- AI product built for one industry workflow.
- Warm intro
- Introduction through a mutual connection. CapSignal maps potential paths via portfolio overlap.
- Warm path
- Introduction route via portfolio founder or mutual.
- Weekly iteration
- CapSignal campaign adjustments based on reply data.