Your SaaS terms glossary

A debt covenant is a lender condition in a loan contract.

Raising capital through loans, bonds, or notes that require repayment with interest over time.

Debt with warrants offers financing with potential equity upside.

Revenue collected in advance for services or products yet to be delivered.

A measure of a company's earnings per share accounting for convertible securities that could be converted to shares.

Dilution refers to the reduction in ownership percentage of existing shareholders when a company issues additional shares...

A clause in investor agreements that protects against ownership dilution by issuing additional shares.

The interest rate used to discount future cash flows to their present value.

EBITDA stands for Earnings Before Interest, Taxes, Depreciation, and Amortization, a key financial metric.

A program that gives employees an ownership interest in the company through stock options.

Raising small amounts of capital from many investors online in exchange for equity.

Equity dilution occurs when a company issues additional shares, decreasing existing shareholders' ownership percentage.

Equity financing is raising capital by selling shares, allowing startups to fund growth without debt.

A plan for a startup's founders and investors to sell ownership, usually through an acquisition or IPO.

Revenue generated from existing customers through upselling or cross-selling additional products/services.

The process of building a model to represent a business's financial forecast.

SaaS flexible financing offers dynamic funding options that adapt to the unique needs of SaaS businesses, supporting growth.

A business model providing basic services for free and charging for premium features.

Understand gross margin and its importance for SaaS companies.

A key metric for measuring customer retention in SaaS by calculating recurring revenue from existing customers.

The process through which a private company becomes publicly traded by offering shares to the public.

Understand LTV: The key metric for customer value prediction.