published 18 August 2016
Every industry has its special language. There is a shared vocabulary amongst doctors, lawyers, journalists, stock market traders—even horseracing aficionados – that help colleagues communicate with each other quickly and efficiently. The problem is a shared language between insiders can also be thoroughly baffling to outsiders.
Start-ups are a case in point. Here are five of the most commonly used terms in the start-up world, contrasted with what they are usually perceived to mean.
What it usually means: An incubator is usually an apparatus where prematurely born infants are kept in controlled conditions for protection and care.
What it means for start-ups: Incubators are institutions that provide a centralized program for startups. The objective is to draw in talent, draw numerous talented individuals to a single location, and to educate/mentor these first-time entrepreneurs to help them find their way into the market.
What it usually means: A deck is a platform-like structure, typically made of lumber, unroofed and attached to a house or building. Or a pack of cards.
What it means for start-ups: A deck, or a pitch deck, is a presentation (usually no more than 10 PowerPoint slides) covering all the aspects of a business. When you describe your venture to potential investors, the deck should be compact and concise while aiming for maximum impact.
What it usually means: An ecosystem is a group of interconnected elements, formed by the interaction of a community of organisms with their environment. It is usually viewed in the context of nature or science.
What it means for start-ups: An ecosystem is the entire environment of start-ups and all related players, a network of interconnecting and interacting parts. Entrepreneurs, their friends and families who help them, schools and institutions, incubators, investors and mentors—all these comprise an ecosystem in the start-up context.
What it usually means: Just another acronym.
What it means for start-ups: Some start-ups provide Software as a Service, which is in contrast to providing software as a product that can be bought and installed into a system. With SaaS, customers gain access to a software and its functions remotely as a Web-based service, and pay for it as a monthly subscription instead of as a big capital outlay.
What it usually means: Creatures from heaven who guide mortals in their daily activities.
What it means for start-ups: Angel investors are similar to venture capitalists in that they fund start-up ventures. They usually provide smaller capital that are most likely their own, whereas VCs provide an average minimum amount that is a managed fund. Angels may come in the form of friends and family, as well as anonymous individuals or angel investor networks. Do-gooders, indeed.