Glossary

Borrowing base explained: eligible receivables, advance rates, ineligibles, concentration caps, and dilution, with a full worked calculation.

Billing cycle explained: monthly vs annual, anniversary vs calendar billing, proration, and co-terming, and how each one changes your cash.

Bad debt is revenue you billed but will never collect. How bad debt expense, allowance for doubtful accounts, and aging schedules really work.

Burn multiple is net burn divided by net new ARR. Get the formula, a worked example, and the benchmark bands from great to bad.

Buy now pay later lets buyers pay in installments while sellers collect upfront. How B2B BNPL underwriting, fees, and embedded checkout actually work.

Bridge financing is short term capital that carries a company to its next round. Compare bridge loans, convertible notes, and the real cost of a bridge.

Capital efficiency measures ARR generated per dollar of capital consumed. Get the formulas, benchmarks, and ways to improve it without slowing growth.

Credit memo explained: how credit notes reduce an invoice, how they differ from refunds and debit memos, and what they do to revenue.

Cost of capital explained: the WACC formula, a worked example, and why founders underprice equity while overpricing financing fees.

CRM is the system of record for pipeline, forecast, and customer history. See how the objects fit together and why implementations really fail.

Customer lifetime value is what a customer is worth after cost to serve. Get the LTV formula, a worked example, and where the math quietly breaks.

Churn rate measures how fast the bucket leaks. Get the formula, logo versus revenue churn, involuntary churn fixes, and cohort analysis explained.

Customer acquisition cost is what one new customer really costs. Get the formula, a worked example, and the LTV to CAC and payback benchmarks.

Credit risk is the chance a buyer never pays. See how probability of default, loss given default, and underwriting turn that risk into a number.

Covenants are the rules attached to borrowed money. See affirmative, negative, and financial covenants, breach consequences, and what to negotiate.

Conversion rate measures how well each funnel stage turns interest into action. Get the formula, worked examples, and the levers that lift win rates.

CPQ turns a verbal yes into an accurate, policy compliant quote. See how configuration, pricing rules, and approvals speed up complex B2B deals.

Collections is how issued invoices become cash. See the dunning cadence, DSO math, and escalation steps that get B2B invoices paid faster.

Cash flow is the money actually moving in and out of your business. See how it works, why it beats profit, and how to collect sooner.

Cap table basics: fully diluted ownership, option pools, SAFEs, preferred stock, and the waterfall math that decides what common shares are really worth.

Deferred revenue explained: why prepaid billings are a liability, not cash you own, plus a worked ASC 606 monthly recognition schedule.

Deal desk explained: what it approves, how the approval matrix works, where CPQ fits, and how to protect margin without slowing the sales cycle.

Days sales outstanding measures how long you wait to get paid. Get the DSO formula, a worked example, best possible DSO, and the countback method.

Dunning turns failed payments back into revenue. Learn retry timing, soft vs hard declines, and how to stop involuntary churn before it starts.

Equity dilution shrinks your ownership every round. See how the math works, what the option pool really costs, and how to raise without it.

Debt financing lets you raise capital without giving up ownership. Compare term loans, lines of credit, and venture debt, plus what covenants cost.

Expansion revenue is the cheapest growth you have. Get the formula, a worked NRR example, and the four sources of upsell and usage growth.

Equity financing trades ownership for cash. See how rounds are priced, what a term sheet really controls, and when to use a non-dilutive option.

Embedded financing puts instant credit decisions and installment terms inside the deal. See the point of sale mechanics, pricing, and recourse.

Embedded finance puts payments, lending, banking, and insurance inside software. See the categories, the BaaS stack, and why platforms build it.

ERP explained for finance teams: general ledger vs subledgers, order to cash, procure to pay, revenue recognition, and a faster financial close.

EBITDA explained with the formula, a worked example, and the add-backs to question. See where it misleads SaaS teams and what to read beside it.

Flat-rate pricing explained: how one fixed price shapes ARPA, expansion revenue, and the sales cycle, and when to switch to usage-based pricing.

Fintech explained for B2B leaders: the four layer stack, how B2B fintech and embedded finance actually make money, and where regulation bites.

Invoice factoring turns unpaid receivables into cash today. See advance rates, real annualized fee math, and recourse vs non-recourse terms.

Gross revenue retention (GRR) explained: the formula, a worked example, how GRR differs from net retention, and benchmarks by segment.

Growth capital explained: growth equity, venture debt, and revenue-based financing compared, plus the burn multiple investors actually check.

Gross margin explained with the formula, a worked SaaS example, COGS rules, benchmarks, and why discounting quietly destroys it.

Go-to-market strategy explained: ICP, pricing and packaging, sales-led vs product-led motions, and the RevOps discipline that makes it repeatable.

GDPR explained for B2B software teams: lawful basis, data subject rights, DPAs, SCCs, and how readiness shortens enterprise security review.

Know Your Business (KYB) explained: entity verification, beneficial ownership, sanctions screening, and how KYB differs from KYC checks.

KYC explained for fintech and B2B teams: identity verification, KYB, beneficial ownership, sanctions screening, and risk rating without the friction.

Master service agreement (MSA) explained: what the framework covers, MSA vs SOW vs order form, and why it drives first deal cycle time.

Monthly recurring revenue explained: the MRR formula, a worked example, the four MRR movements, and why MRR is never the same as cash collected.

Milestone-based billing explained: how to structure deliverable payments, write enforceable acceptance criteria, and handle deferred revenue.

Merchant cash advance explained: factor rate, holdback, daily remittance, and the math that turns a 1.35 factor into a 96 percent APR.

Market penetration explained: the formula, a worked example, TAM vs SAM vs SOM, penetration pricing, and how to win displacement deals.

Net 30 explained: when the clock starts, how it differs from due on receipt, what it really costs, and the 37 percent price of 2/10 net 30.

Net dollar retention (NDR) explained: the NRR formula, a worked example, gross vs net retention, and what the 120 percent benchmark really means.

Order form explained: what a B2B software order form contains, how it differs from a quote and a purchase order, and the fields that delay payment.

Operating cash flow explained: the indirect method formula, a worked example, working capital effects, and how OCF differs from EBITDA and free cash flow.

Purchase order financing explained: how it pays your supplier, real fee math, gross margin requirements, and what it means for software firms.

Payment rails explained: ACH, wires, RTP, FedNow, and cards compared on settlement speed, cost per transaction, and reversibility.

Product-led growth explained: freemium vs free trial, PQLs, time to value, bottom up adoption, and how hybrid GTM teams close self serve accounts.

Payment terms explained: net 30, net 60, net 90, EOM traps, 2/10 net 30 discounts, and what offering net terms really costs a seller in cash.

CAC payback period explained: the gross margin adjusted formula, a worked example, benchmarks by segment, and how payback differs from LTV to CAC.

PCI-DSS explained: the twelve requirements, compliance levels, SAQ types, cardholder data scope reduction, and what changed in PCI DSS 4.0.

Quote-to-cash explained: the full chain from CPQ and order form to billing, revenue recognition, and collections, plus where the process leaks cash.

Revenue recognition under ASC 606 explained: the five step model, performance obligations, deferred revenue, and why financing never changes the schedule.

Runway is cash divided by monthly net burn. Get the formula, net burn vs gross burn, default alive, and the levers that buy months without cuts.

Rule of 40 adds growth rate to profit margin and expects 40 or better. See the formula, worked scores, which margin to use, and burn multiple.

Risk-based pricing prices each buyer on measured default risk, not one flat rate. See the expected loss formula, credit tiers, and pricing grids.

Revenue-based financing trades a share of monthly revenue for cash today. See the repayment cap math and the real annualized cost of a 1.5x deal.

RevOps unifies marketing, sales, and customer success under one data model. See what a RevOps team owns and how it lifts forecast accuracy.

Renewals are how recurring revenue survives contract expiration. Get the renewal rate formula, auto-renewal traps, and retention benchmarks.

Ratio Trade lets B2B buyers pay monthly or quarterly while you collect the full contract value upfront. Ratio underwrites the buyer and runs the schedule.

Ratio Boost turns existing recurring contracts into upfront growth capital: non-dilutive, no warrants, no change to how your customers pay.

ROI compares net return to what an investment cost. Get the ROI formula, a worked example, payback period, and where NPV and IRR do it better.

Special purpose vehicle (SPV) explained: bankruptcy remote entities, true sale, ring fencing, and how a financing SPV differs from a syndicate SPV.

Securitization pools contracted cash flows and sells them as notes. See how tranches, credit enhancement, SPVs, and true sale really work.

Sales velocity measures how much revenue your pipeline closes per day. Get the formula, a worked example, and the one lever that moves it most.

Statement of work (SOW) explained: deliverables, acceptance criteria, milestones, change orders, and how an SOW differs from an MSA and order form.

Sales cycle length decides when pipeline turns into cash. Get the formula, benchmarks by segment, and the four things that stall late stage deals.

SMB means small and medium-sized business. What it means in SMB finance, where it ends and mid-market begins, and why SMB churn runs so high.

Trade credit explained: net terms, the real cost of 2/10 net 30, credit limits, and what extending open account terms costs the seller.

Total contract value (TCV) is every dollar a contract commits over its full term. Get the formula, a worked example, and how TCV differs from ACV and ARR.

Usage-based pricing explained: metered billing, value metrics, credits and commits, plus the honest tradeoff between expansion and predictability.

Unit economics explained: contribution margin, CAC, LTV to CAC, and payback period, with a worked example of when a customer actually pays back.

Upsell means growing revenue inside an account you already won. See how upsell differs from cross-sell, why it drives NRR, and what stalls expansion deals.

Underwriting is how lenders decide who gets credit and on what terms. See what underwriters check, how automated decisioning works, and why speed matters.

Vendor financing explained: in-house installment plans versus third-party funding, captive finance, and what each does to seller cash and risk.

Venture debt explained: how facilities are sized, what warrant coverage really costs, and how to calculate the all-in rate before you sign a term sheet.

Value-based pricing sets price by the value you create, not your costs. See how to size willingness to pay, pick a value metric, and stop discounting.

Value-added reseller (VAR) explained: how VARs earn margin, how they differ from distributors and MSPs, and why channel deals strain working capital.

VAT explained: how output and input VAT net out, when the reverse charge applies, and why cross-border invoicing stalls deals. Includes the VAT formula.

Working capital is current assets minus current liabilities. Get the formula, a worked example, the cash conversion cycle, and why growth eats liquidity.

Warrants are rights to buy shares at a fixed strike price. See how warrant coverage is calculated, what penny warrants cost, and where dilution lands.