The Crowdfunding Glossary
To understand the world of crowdfunding and master its secrets and strategies, it is necessary to learn the language that is spoken within this world: what follows is a useful glossary for learning the vocabulary and basics.
A mode of raising funds whereby the amount paid by investors is collected only if it equals or exceeds the predetermined minimum target. It is the most common mode for equity and lending crowdfunding campaigns.
Alternative financing channels to traditional lending institutions.
Aucap (Capital Increase)
Notarized deed that allows a company to increase its capital stock by issuing new shares.
Software used to handle repetitive operations automatically.
User awareness of the existence of a corporate brand, its product/service, and the type of need it meets.
Informal investors who provide capital and expertise to promising startups.
Document that defines the objectives, strategies, processes, policies and actions of an enterprise or project and outlines the financial and economic implications of the same.
Call to action
Inviting the user to perform a certain action, by means of an explicit and unique message and/or tool (e.g., a button, a fill-in field).
Figure responsible for managing a crowdfunding campaign as a whole, coordinating the various activities and monitoring the achievement of goals.
Value of the sums and assets contributed by shareholders, as venture capital, at the time of incorporation of the enterprise or by subsequent changes (see Capital Increase)
Commissione Nazionale per le Società e la Borsa, an investor protection body in Italy.
Indicator of the amount of money raised in a crowdfunding campaign in real time, found on the campaign's online page (see Crowdfunding Platforms).
People you come into contact with for the first time or the first few times, who do not yet know the company.
Co-sale right (tag-along)
Clause guaranteeing investors the possibility to sell their share to a prospective buyer on the same terms proposed to majority shareholders.
Cost per Lead, or the cost incurred to acquire a single lead (see Lead), which indicates the effectiveness of marketing actions taken by a company.
Customer Relationship Management, i.e., software for managing customer relationship across multiple channels and analyzing customer data.
Neologism for a person who founds projects and grows them using crowdfunding.
Collective funding, or fund raising, mostly online, from groups of people who share a common goal or interest.
Online portals that provide the infrastructure for collective funding campaigns.
Investment operations in crowdfunding campaigns.
Pathway through which Italian SMEs can realize through crowdfunding the public offering process for listing on the stock exchange.
Path of interaction between company and customer that leads the latter to purchase the product/service.
Direct access to the stock exchange without IPO, with share price trading directly in the market.
Clause that gives majority shareholders the right to also sell the shares of minority shareholders, on the same economic terms as their own, without having to seek consent.
Online advertising campaign that consists of placing banner ads of your company on third-party sites related to your business and/or the interests of your target audience.
Fundraising for an ethical or social project whose supporters normally receive nothing in return.
Early investors in a campaign, who usually receive more favorable terms or special rewards.
Calendar of content to be posted on different social media and corporate communication channels.
Collective financing mode involving the purchase by investors of shares in the proposing company.
The rights of shareholders to participate in the distribution of dividends (profits) of the company and to receive their share of liquidation proceeds if the company is dissolved.
Sale of one's shares in a company ("exit" from investment).
Expressions of interest (binding+non-binding)
Statement of interest in investing in a company’s crowdfunding campaign; binding if it involves the signing of a contract and an official commitment to pay a certain amount of money, non-binding if it is an informal, generic statement.
Capital raising operations with arrangements other than the criteria established within the crowdfunding campaign (different costs, etc.).
The so-called 3Fs, or the first circle of people to turn to for support and funding, to which can be added the fourth F "fans."
Financial instruments promoted to foster competitiveness and competition among enterprises and to support the establishment of new businesses.
Online form consisting of fields to be filled in with certain data.
Design of the path of actions a user must take and undergo to go from stranger to customer of the company.
Initial Decentralized Exchange Offering, a digital asset exchange platform that enables disintermediated transactions.
Minimum threshold of money to be raised in the set time period for the crowdfunding campaign to be valid.
Risk profile of an investor established on the basis of his or her objective, the time horizon of the investment, and the risk he or she can afford to take in relation to the capital invested.
Initial Public Offer, or Initial Public Offering, the public offering of the securities of a company that wants to go public; a requirement for listing.
Keywords used by users to perform search engine and social searches.
Key Performance Indicators, which are measurable values that make it possible to analyze the effectiveness of a company's actions and verify the achievement of objectives.
Web "landing" page, i.e., the first page on which a user arrives by clicking a link. The main page of a website.
Professional investors and investment institutions with large volumes of investable assets.
Content aimed at attracting a user to become their own contact (lead).
Person whose contact information you have and who is potentially interested in the product/service you are offering.
Collective financing mode that consists of a loan between individuals and remunerates investors who lend the money with the repayment of the loan plus interest.
Software to automate repetitive marketing tasks such as sending emails or tracking customer activity.
Process of identifying the needs and requirements of current and potential customers aimed at determining the most appropriate actions to satisfy them and position one's products and services most effectively.
Budget dedicated to sponsoring a project on various communication channels.
Document containing the main information related to a tender offer transaction.
Searching for users on a search engine that, through keywords, leads to the company site, blog or e-commerce.
Exceeding the minimum collection goal (see Inseparable) set for a crowdfunding campaign.
Links, banners and other paid advertising elements that attract users’ clicks to bring them to the company site.
Text writing activities for websites, emails, social media posts and any business communication channel aimed at persuading users to take an action.
Agreements among the shareholders of a company made outside of the articles of association and bylaws to regulate common actions within the company.
Assessment of the value of the company after the closing of a financing round. It is obtained by summing the pre-money valuation with the capital raised.
Period following the closing of a successful crowdfunding campaign and related communications and actions towards supporters.
Evaluating the value of the company prior to a financing raising, aimed at determining the price and amount of shares that will be sold to each person participating in the financing transaction.
Stage prior to launching a crowdfunding campaign, in which to gather contacts and expressions of interest (see entry) for the campaign.
Institutional entities such as investment companies, insurance companies, funds, banks, etc., or individuals with substantial assets and high financial expertise. They are referred to as “sophisticated investors” in the new EU Regulation.
Person potentially interested in the product/service offered by the company, who does not yet have the direct contact information.
Score given by Google to advertisements based on their consistency with the reference keywords (see entry) chosen for each ad.
Real estate crowdfunding
Label attributed to crowdfunding transactions in real estate, both lending and equity types.
Ordinary savers who decide to invest their savings. They are referred to as “unsophisticated investors” in the new EU Regulation.
Reward (reward on top)
Reward for supporters of a crowdfunding campaign, serving as an incentive to solicit participation and give something back. The reward-on-top approach relies on this element as the first lever to attract investors.
Collective funding mode that rewards supporters with a "prize."
Right of withdrawal
Right to withdraw from investment if previously undisclosed information or material errors in the offer emerge.
Right of reconsideration
Right to withdraw from investment within seven days of joining the campaign, without penalty.
Right to vote
Right to vote on decisions in the corporate meeting.
Simple Agreement for Future Equity, a financing contract that provides for shifting the valuation of the company into the future and through which a party (safe holder) obtains a financial instrument that gives him the right to convert it into shares (equity) at a favorable price upon the occurrence of a specific liquidity event.
Activity of finalizing the sale of a company's product or service.
Search performed on search engines (e.g., Google) and advertising campaign aimed at placing their ads in the results of these searches based on relevant keywords (see entry).
Exchange market for shares or bonds of companies previously issued and purchased in the primary market (directly from the company, on the stock exchange, or in a crowdfunding campaign, for example).
Percentage of capital stock (see item) of an enterprise held by each shareholder.
An enterprise with fewer than 250 employees and a turnover less than or equal to 50 million euros per year.
Social media posts that are shown to target users at agreed-upon times and ways upon payment by the company.
Stock exchange listing
Inclusion of a company’s shares in the list of shares officially traded on a stock exchange.
A surety whereby a person undertakes to a creditor to fulfill an obligation on behalf of a person who is in a position where he or she is no longer able to do so.
All parties directly or indirectly involved in a company's business, from supplier to customer.
A company that has been established for no more than 5 years and has a turnover of no more than 5 million euros, is not listed on the stock exchange and does not distribute profits.
Security Token Offering, the sale of digital investment instruments on a platform authorized by a central authority.
Storytelling activities as a communication strategy.
Work for equity
Remuneration of a work service or supply with shares in the company.
People who are already customers of the company or have been in contact with the company for some time, know the company and have an interest in it.