Founded by Nicklaus “Nick” Moser, Moser Capital Management works with entrepreneurs in the early stages of their startups, helping them establish themselves in the market. Taking a hands-on approach to managing portfolio companies, Moser Capital Management’s team also supports founders as they raise money from investors.
Below is a glossary of terms every entrepreneur needs to understand before embarking on a financing round:
-Term sheet. This is a non-binding summary of the offer from a potential investor. It clarifies the terms upon which the investor is willing to invest in a startup. These terms are negotiable.
-Due diligence. This is the process in which an investor digs deep into a startup to confirm statements put out by founders and to verify details about the firm. It happens after a term sheet is written up but before investors wire cash into the startup’s account.
-Pro rata rights. This is a right carried by an investor to potentially increase their ownership stake in a company in subsequent funding rounds, without which their initial stake would be diluted. An investor may request this to safeguard their ownership stake from excess dilution.
-Convertible note. A type of financing where an investor loans a startup money with interest but maintains the right to convert that debt to equity later on. It is a common arrangement in very early-stage companies when accurate valuation is difficult.
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