• Johnson Manasseh

  • Let's grow together


0123 456 789


121 King Street, Melbourne Victoria 3000 Australia

Must-Know Startup Terms for Future Entrepreneurs

Inspired by the popular TV show Shark Tank, where people show their ideas to investors, noticed that many words used on the show might be confusing for newbies. This got me thinking: Why not make these terms easier to understand?

So, decided to break them down and share what we know with people who want to start their own businesses. So let’s start with an example 

Once upon a time in TechTown, a bunch of tech lovers had this big idea: make gadgets that blend tech seamlessly into everyday life. That’s when TechFit was born.

Their main thing was the SmartBand, a game-changer in fitness tracking. But as they got going, they bumped into a bunch of fancy startup words. Here’s how they figured them out

EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization)

EBITDA is a way to see how much money a company makes from its main operations before subtracting other expenses like taxes or loan payments. For TechFit, it helped them understand how well they were doing financially, even during tough times.

Gross Margin

Gross Margin is the difference between the revenue generated from sales and the cost of producing the goods sold. In simpler terms, it’s the profit a company makes before deducting other expenses such as overhead costs or taxes.

For TechFit, understanding their Gross Margin meant considering how much money they’d keep from selling the SmartBand after covering the costs of making it. This helped them plan for long-term sustainability and growth.


Dilution happens when a company gives away part of its ownership to get more money from investors. TechFit did this to raise funds for growth, even though it meant they would own a smaller part of the company.


Monthly Burn

Monthly Burn shows how fast a company is spending its money each month. With more cash from investors, TechFit could do more, but they kept an eye on their spending to make sure they didn’t spend too much.

Net Profit

Net Profit is the money a company has left after paying all its bills, like taxes and other expenses. For TechFit, it showed how much they were really making from selling their SmartBand after taking out all their costs.


Equity means owning a part of a company. It’s like owning a piece of a pie. When TechFit needed more money to grow, they asked outside investors for cash. In return, they gave those investors a share of their company.

This is called equity financing. It helped TechFit get the money they needed to grow, but it also meant they had to share control of their company. Despite this, TechFit saw it as a smart move to expand and reach their big goals in the long run.

Skyrocket your customer base with our digital marketing specialists

Get a free consultation
limited time


Valuation is how much investors think a company is worth based on things like its products and how much money it’s making. TechFit’s increasing valuation showed that investors believed in their products and saw potential for growth.

In conclusion, understanding startup terms is vital for new entrepreneurs. By explaining terms like EBITDA, Gross Margin, Dilution, Monthly Burn, Net Profit, Equity, Valuation, and Margin, we aim to empower individuals to make smart decisions for their businesses.

Like TechFit, who used these concepts to grow, aspiring entrepreneurs can use this knowledge to succeed. So, next time you hear these terms on Shark Tank or elsewhere, remember: they’re not just fancy words—they’re tools for success.


“Don’t miss out on our latest computer science, technology, lifestyle, and design updates! Keep our notifications on to stay up-to-date.”

Want to get weekly knowledge ?

Get notified whenever we post new stuffs.