The Business Professor
Total Quality Management
What is Total Quality Management or TQM? Total quality management consists of organization-wide efforts to "install and make permanent climate where employees continuously improve their ability to provide on demand products and services...
The Business Professor
Time to Market
What is the Time to Market for a startup venture? Time to Market (TTM) is the time it takes to go from an idea to a finished product. Sometimes you will come across the term Speed to Market (STM). In the context of startups, TTM is a...
The Business Professor
Term Sheet Provisions
What are Term Sheets? What are the primary term sheet provisions? A term sheet often covers four main categories: the deal economics, the investor rights, the governance and oversight, and the exit terms. A term sheet must communicate...
The Business Professor
Strategic Analysis and Developing a Competitive Strategy
What is a Strategic Analysis? How does strategic analysis lead to a competitive advantage? Strategic analysis drives out internal and external strengths and weaknesses that affect the organization's growth. It helps you identify the...
The Business Professor
Strategic Acquirer of a Startup
What is a Strategic Acquirer in a Startup? What is a strategic acquisition? Strategic acquisition is more concerned with ensuring that the merger fits within the expectations of the company's long-term plans for the business. To achieve...
The Business Professor
Stock Vesting Schedule
What is a Stock Vesting Schedule? A vesting schedule is an incentive program for employees that gives them benefits, usually stock options, when they have contractually fulfilled a specified term of employment with the company. The...
The Business Professor
Steps in Developing an Operational Plan
What are the Steps in Developing an Operational Plan? Operations plans are extremely specific, detailed documents that clearly define how a department or team can contribute to reaching specific company goals. They typically outline the...
The Business Professor
Stakeholder Analysis
What is Stakeholder Analysis? Stakeholder analysis in conflict resolution, business administration, environmental health sciences decision making,[1] industrial ecology, public administration, and project management is the process of...
The Business Professor
Special Employee Provisions - Term Sheet
What are the Special Employee Provisions in a Term Sheet? The parties often negotiate numerous employee-related provisions into the term sheet. These provisions serve as control mechanisms to either incentivize current management or...
The Business Professor
Small Business Investment Company (SBIC)
What is a Small Business Investment Company (SBIC)? An SBIC is a privately owned company that's licensed and regulated by the SBA. SBICs invest in small businesses in the form of debt and equity. The SBA doesn't invest directly into...
The Business Professor
Shipping and Logistics Functions
What are Shipping and Logistics Functions? Shipping is the act of physically transporting goods or materials between locations. Logistics, on the other hand, is the process of managing an intricate operation. Logistics is used in a vast...
The Business Professor
Set up a Business Entity
What are the steps necessary to set up a Business Entity?
The Business Professor
Self-Employed Contributions Act - SECA
What is the Self-Employed Contributions Act (SECA)? The self-employed pay Self-Employed Contributions Act (SECA) taxes on net earnings. SECA taxes also fund Social Security and Medicare. The self-employed pay both the employee and the...
The Business Professor
Registration Rights - Term Sheet
What are Registration Rights in a Term Sheet? A registration right is a right entitling an investor who owns restricted stock to require that a company list the shares publicly so that the investor can sell them. Registration rights, if...
The Business Professor
Redemption Rights - Preferred Shares
What are Redemption Rights attached to Preferred Shares? The right of redemption is the right to demand under certain conditions that the company buys back its own shares from its investors at a fixed price. This right may be included to...
The Business Professor
Public Offering - Exiting a Business
What is a Business Exit Event? How is a Public Offering a business exit event? An Exit Event is an event where founders and early investors can sell their interest in a company for cash. An exit can be an initial public offering (IPO) or...
The Business Professor
Protective Provisions - Term Sheet
What are Protective Provisions in a Term Sheet? Protective provisions are terms that allow preferred shareholders to veto or block specific corporate actions. Protective provisions can help protect the interests of minority shareholders...
The Business Professor
Preferred Stock - Liquidation Preference
What is a liquidation preferenc in preferred stock? A liquidation preference is a clause in a contract that dictates the payout order in case of a corporate liquidation. Typically, the company's investors or preferred stockholders get...
The Business Professor
Payment Terms - Explained
What are Payment Terms for debtors of a business? Payment terms outline how, when, and by what method your customers or clients provide payment to your business. Payment terms are typically associated with invoice payments. They are an...
The Business Professor
Participating Preferred Stock
What is Participating Preferred Stock? Participating preferred stock is preferred stock that provides a specific dividend that is paid before any dividends are paid to common stock holders, and that takes precedence over common stock in...
The Business Professor
Participating Convertible Preferred Stock
What is Participating Convertible Preferred Stock? A participating convertible preferred (PCP) share is a financial term referring to a security most often issued as part of a venture capital financing deal before a company experiences...
The Business Professor
Option Pools & Capitalization
What are Option Pools? How do Option Pools affect company capitalization? An option pool allows startups to budget out how much equity they will reserve for hires between each funding round. Without an option pool, employee equity would...
The Business Professor
Monetize a Business Idea
How doe you Monetize a Business Idea? 1. Validate that there is a market for your idea. · 2. Talk to people in your chosen market. · 3. Create a prototype.
Institute for New Economic Thinking
What Venture Capitalists Do | #2 | Venture Capital in the 21st Century
What is the relationship between entrepreneurial firms and venture capital? In providing start-up financing, venture capital investment may earn high payoffs if a new technology succeeds, but also risks large losses if it does not....