Financing rounds roughly follow the given naming scheme:
* Early-stage companies:
* Series Pre-Seed
* Series Seed
* Series A
* Mid-stage companies:
* Series B
* Series C
* Late-stage companies:
* Series D
* ...
Financing rounds with numerical suffices (e.g. Series B-1) usually refer to situations where the same investors, on the same terms, invest additional money.
%%ANKI
Basic
What name is given to the earliest financing round?
Back: Series Pre-Seed.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1719151112996-->
END%%
%%ANKI
Cloze
The Series {Seed} round follows the Series {Pre-Seed} round.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1719151113006-->
END%%
%%ANKI
Cloze
The Series {A} round follows the Series {Seed} round.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1719151159514-->
END%%
%%ANKI
Basic
When does a Series A round transition to a Series A-1 round?
Back: When the same investors, on the same terms, invest additional money.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1719151113015-->
END%%
%%ANKI
Basic
When does a Series A round transition to a Series B round?
Back: When new investors or new terms are applied to a new investment.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1719151113019-->
END%%
%%ANKI
Basic
When does a Series A-2 round transition to a Series B round?
Back: When new investors or new terms are applied to a new investment.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1719151113024-->
END%%
%%ANKI
Basic
When does a Series A-2 round transition to a Series B-1 round?
Back: N/A.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1719151113030-->
END%%
%%ANKI
Basic
What financing rounds are considered "early-stage"?
Back: Series Pre-Seed, Seed, and A.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1719151113034-->
END%%
%%ANKI
Basic
What financing rounds are considered "mid-stage"?
Back: Series B and C.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1719151113039-->
END%%
%%ANKI
Basic
What financing rounds are considered "late-stage"?
Back: Series D and after.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1719151113045-->
END%%
A **party round** refers to a financing round with many investors that make relatively small investments.
%%ANKI
Cloze
A {party round} is a {round of financing with many investors making small investments}.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1719360934653-->
END%%
%%ANKI
Basic
Why are party rounds discouraged?
Back: You have many VCs but none committed in any meaningful way.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1719360934657-->
END%%
%%ANKI
Basic
Why aren't VCs usually meaningfully committed in a party round?
Back: Their investment is likely much smaller relative to what they'd normally invest.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1719360934661-->
END%%
%%ANKI
Basic
What is the primary motivation behind having a party round?
Back: You can potentially have many fancy names associated with your company.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1719360934665-->
END%%
## Venture Capitalists
A **venture capitalist** (VC) is an investor who provides capital to companies in exchange for an equity stake on behalf of a firm. A firm comprises of the following roles (in order of seniority):
* **Managing director** (MD) or **general partner** (GP). The VCs that make the final investment decisions and sit on the boards of directors of the companies they invest in.
* **Principal** or **director**. Junior deal professionals looking to become managing directors.
* **Associate**. Work for one or more deal partners, usually a managing director.
* **Analyst**. Individuals with similar responsibilites as the associate, though usually less deal-centric.
%%ANKI
Basic
What is VC short for?
Back: **V**enture **c**apitalist.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1718878788273-->
END%%
%%ANKI
Basic
What ambiguity does the term "VC" introduce?
Back: It may refer to a VC firm or an individual of said firm.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1718878788303-->
END%%
%%ANKI
Cloze
Typically VCs provide {capital} in exchange for {equity}.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1718878788311-->
END%%
%%ANKI
Basic
How is a "venture capitalist" defined?
Back: An investor who provides capital to companies, on behalf of a firm, in exchange for equity.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1718878788328-->
END%%
%%ANKI
Basic
What form of capital does a VC typically work in?
Back: Cash flow.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1718878788334-->
END%%
%%ANKI
Basic
Within a VC firm, what does MD stand for?
Back: **M**anaging **d**irector.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1718878788338-->
END%%
%%ANKI
Basic
Within a VC firm, what does GP stand for?
Back: **G**eneral **p**artner.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1718878788342-->
END%%
%%ANKI
Basic
With respect to a VC firm, what does a "managing director" refer to?
Back: A senior VC, generally responsible for making final investment decisions.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1718879311552-->
END%%
%%ANKI
Basic
With respect to a VC firm, what does a "general partner" refer to?
Back: A senior VC, generally responsible for making final investment decisions.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1718878788345-->
END%%
%%ANKI
Cloze
A {general partner} is also known as a {managing director}.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1718878788348-->
END%%
%%ANKI
Cloze
The {principal/director} role follows the {MD/GP} role in seniority.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1718878788353-->
END%%
%%ANKI
Basic
With respect to a VC firm, what does a "principal" refer to?
Back: A VC working their way up to becoming a GP.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1718878788357-->
END%%
%%ANKI
Basic
With respect to a VC firm, what does a "director" refer to?
Back: A VC working their way up to becoming an MD.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1718879311558-->
END%%
%%ANKI
Cloze
A {principal} is also known as a {director}.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1718878788361-->
END%%
%%ANKI
Basic
What types of VCs are grouped under term "deal partner"?
Back: GPs and principals.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1718878788368-->
END%%
%%ANKI
Basic
What distinguishes VCs from angel investors?
Back: The former use a pool of investors' money. The latter uses their own money.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1718879311563-->
END%%
%%ANKI
Cloze
The {associate} role follows the {principal/director} role in seniority.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1718879311566-->
END%%
%%ANKI
Cloze
The {analyst} role follows the {associate} role in seniority.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1718879311572-->
END%%
%%ANKI
Basic
How are analysts and associates typically distinguished?
Back: The latter are usually more deal-centric than the former.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1718879311577-->
END%%
%%ANKI
Basic
What role is a recent college graduate likely given at a VC firm?
Back: Analyst.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1718879311581-->
END%%
%%ANKI
Basic
With respect to a VC firm, what does an "associate" refer to?
Back: An employee usually working directly for one or more deal managers.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1718879311586-->
END%%
%%ANKI
Basic
With respect to a VC firm, what does an "analyst" refer to?
Back: An employee working on general functions for the firm.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1718879311590-->
END%%
While some VCs invest alone, many invest with other VCs. A collection of investors is called a **syndicate**. Most syndicates have a **lead investor** usually responsible for taking the role of negotiating terms on behalf of the entire syndicate.
%%ANKI
Cloze
A {syndicate} is a {collection of investors}.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1719360934669-->
END%%
%%ANKI
Basic
A syndicate collectively refers to which kind of investors?
Back: *Anyone* that ends up purchasing equity in a financing.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1719360934673-->
END%%
%%ANKI
Basic
A "lead investor" is considered the lead of what?
Back: A syndicate.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1719360934678-->
END%%
%%ANKI
Basic
What is the usual responsibility of a lead investor?
Back: Negotiating terms on behalf of the syndicate.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1719360934682-->
END%%
%%ANKI
Basic
*Why* do entrepreneurs want a lead investor?
Back: To limit the number of negotiations to just those with the lead.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1719360934687-->
END%%
%%ANKI
Basic
How many lead investors can a syndicate have?
Back: There is no limit.
Reference: Brad Feld and Jason Mendelson, _Venture Deals_, 3rd ed., n.d.
<!--ID: 1719360934693-->
END%%
## Angel Investors
**Angels** are usually high-net-worth individuals that invest in a company. They must qualify as an **accredited investor** or have an appropriate exemption to invest. Angel investors that make many small investments to companies are called **super angels**.
