Horizontal Mergers

A horizontal merger is when two or more competing companies in the same industry combine into one company.

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This glossary provides an overview of some key legal terms for startups. It's essential to consult with a legal professional to ensure a comprehensive understanding of these terms and their implications for your specific situation.

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Indication Of Interest

An indication of interest (IOI) is a formal, yet non-binding letter or document expressing interest in purchasing either a company or a company's securities.

Exit

An ‘exit’ is when a founder leaves a startup. For many founders, this is something they’ve planned for from day one, perhaps even hoping to build a unicorn company. They created the startup with the plan of cashing out at some point by selling ownership of the company either to investors or to another company.

NPV Formula in Excel

Net present value (NPV) is the current value of all the cash flows that will happen in the future. This is calculated with the nominal value of cash flow in the future and a discount rate. The equation can be used to calculate the net present value of all cash flows in the future.