investment-terms

Vocabulary Word

Definition

'Investment terms' refer to the specific details agreed upon when someone invests money into a business. This includes how much money will be invested, how it will be used, and when the investor might expect a return.

Examples in Different Contexts

In Startup Financing, 'investment terms' define the specifics of how funding is provided to startups, including the valuation cap, discount rates for future financing rounds, and liquidation preferences. A startup founder might share, 'Negotiating favorable investment terms was critical to closing our seed funding round successfully.'

Practice Scenarios

Academics

Scenario:

For our final project, we'll be studying a real-life business' investment scenario. Let's examine closely the implications of different financial terms.

Response:

Let's draw up a list of potential investment terms and decide which ones we should study.

Finance

Scenario:

Our client has agreed to invest in the project, but they want a detailed plan of the potential return on investment and associated risks.

Response:

We should draft the investment terms that outline the profit margins and potential risks to the client.