Pay-To-Play

Pay-to-play provisions are a form of safeguard for companies, helping to protect them from a downturn in market conditions.

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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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Net Operating Income Formula

Net operating income (NOI) is a formula real estate investors use to determine the profitability of a potential real estate investment or other investment. The net operating income formula subtracts your annual gross operating income from your annual operating expenses to see how much cash flow a property or business generates.

ROE Equation

The return on equity (ROE) equation is used to calculate a company’s returns on capital raised through equity.

Anti-dilution

A protective provision for investors that adjusts their equity ownership percentage in the event of a future funding round at a lower valuation, ensuring their stake is not reduced unfairly. Anti-dilution provisions can come in various forms, such as full ratchet or weighted average adjustments.