ESB V2 Vocabulary

Patent

A legal method used to protect an invention for a limited time.

LLC

A limited liability company (LLC) is a business with pass-through taxation where owners pay taxes on the company's profit and losses through their personal taxes.

Distribution Channel

A method used to get a product from the manufacturer to the end-users.

MVP

A minimum viable product (MVP) is an inexpensive preliminary product to test the product idea.

Compensation

A monetary amount given to employees in return for their work.

Lean Canvas

A one-page document discussing key information commonly seen in a business plan.

Hourly Pay

A payment amount provided to employees for the number of hours they worked.

Investor

A person or entity willing to provide monetary funds to a business with the hopes of earning a return on their money.

Sales Pitch

A persuasive speech prepared to entice a potential customer to purchase a service or good.

SWOT Analysis

A planning tool used to document a company's strengths, weaknesses, opportunities, and threats.

Trade Secret

A practice used by businesses to protect a practice, process, or formula from being shared with other competitors.

Trademark

A practice used to protect brand names, logos, and business names.

Prototype

A preliminary product, commonly a product with minimum viability, from which to test and develop.

Pitch Deck

A presentation given to potential investors to provide a brief overview of the business plan to earn another meeting.

Value Proposition

A promise of value that a company makes about their product or service that makes it attractive to customers.

Confidentiality Agreement

A signed agreement stating that an entity will not disclose information agreed upon by all parties in an arrangement.

Business Opportunity

A situation an entrepreneur analyzes and evaluates to see if starting a sustainable, profitable business is feasible.

Asset

A tangible item a business owns.

Sole Proprietorship

A type of business structure with a single owner. The business is not shielded from any amount of liability.

S Corporation

A type of business structure with a special tax advantage that allows the company to pass its income, losses, deductions, and credits through its shareholders.

Nonprofit

A type of business that has no owner and does not pay federal US taxes.

Piece Work

A type of compensation provided for the amount of work produced.

Marketing Plan

A written plan that outlines a company's marketing strategies.

Contract

An agreement between an employee and a company outlining obligations and terms of employment.

Employee

An individual hired by a company and compensated for their work.

Customer

An individual or business that purchases goods and services from a business.

Stockholder

An individual that owns at least one share in a corporation's stock.

Entrepreneur

An individual who aspires to start and run a successful business.

Stakeholder

An individual with an interest in a business.

Service

An intangible service or skill that is performed.

Angel Investor

An investor who provides funding to a business for a stake in the business in return.

Acquisition Costs

Cost incurred by a business.

Fixed Costs

Costs a business has that remain the same no matter the volume of production.

Royalty Fees

Fees paid for the use of a brand name or image.

Variable Costs

Fluctuating costs that a business has depending on production.

Inventory

Goods a business owns with the purpose of selling.

Sales Channel

How a business sells its products and services to the end customer.

ROI

Return on investment (ROI) is a calculation used to determine how much an investment is making.

Demographics

Statistical data that refers to particular groups within a population.

CEO

The Chief Executive Officer (CEO) holds a leadership role within a business. The CEO oversees a business's operations and resources and makes the major decisions for the company.

CFO

The Chief Financial Officer (CFO) holds a leadership role within a business. The CFO oversees a company's finances.

COO

The Chief Operating Officer (COO) holds a leadership role within a business. The COO is responsible for overseeing the day-to-day administrative and operational functions of a business.

Profit

The amount of financial gain from a business.

Budget

The amount of money a business plans on spending during a given period.

Price

The amount of money charged for goods or services.

Liability

The amount of money owed to an entity.

Grit

The characteristic of being able to tackle goals with courage and perseverance.

Operating Costs

The expenses incurred for running day-to-day tasks in a business.

Target Market

The group of customers a company chooses to market its products and services.

Owner

The individuals that own the business.

Revenue

The number of sales and other income in a business for a given period.

Founder

The person that developed or created a company or organization.

Break-Even Point

The point where a business's revenue matches its expenses over a given period.

Selling Price

The price a company charges for its product or service. The selling price is determined by adding the cost price and the profit margin the company wants to earn.

Opportunity Recognition

The way one approaches new ideas and ventures in their life.

Partners

Two or more individuals that share a business's financial responsibility.

C Corporation

A business structure that allows the company to pass its income, losses, deductions, and credits through its shareholders to decrease their taxation.

Franchise

A business that takes its name and characteristics from an existing business chain.

B2B

A business-to-business (B2B) commercial transaction between businesses.

B2C

A business-to-consumer (B2C) transaction.

Burn Rate

A calculation used to measure a business's monthly cash flow.

Intellectual Property

A creative work or invention to which an individual has been given rights.

Business Plan

A document that addresses the concept, customers, and capital for a business.

Balance Sheet

A document that compares assets to liabilities plus owner's equity.

Commission

A fee paid to an employee for completing a task.

Income Statement

A financial statement that details a business's revenue and expenses for a given period.

Salary

A fixed payment amount provided to a full-time employee.

Marketing

A form of communication between businesses and customers which relays a message promoting services and/or goods.

Copyright

A form of protection individuals can implement to protect their intellectual property. Copyright is designated for print, music, film, and various other forms of creative licenses.