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burn rate
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rate at which cash outflow exceeds cash inflow
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buyback clause
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legal agreement regarding an exit by a founding team member prior to the harvesting of the venture
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code of conduct
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formal statement that provides guidance on how ethical conduct is demonstrated
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company culture
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shared beliefs, values and assumptions held by people regarding how to behave or conduct themselves within the context of fitting into an organization
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Delphi method
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group decision-making process that includes a diverse group of people who are located at different locations and willing to respond to a series of questionnaires to assist in providing ideas, information or solutions to a defined question or problem
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escalation of commitment
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tendency to continue with a predetermined action based on the past efforts and contributions to the project rather than an analysis of the current realities that disclose a new solution or approach is necessary
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fail-safe point
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identified point that triggers the entrepreneur to consider what actions are needed to bring the venture back to a healthy position and whether this action is reasonable and feasible
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founders’ agreement
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written document that addresses contractual topics such as division of equity, compensation, contributions to the venture, and commitments to the venture with timelines included
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Gannt chart
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bar chart used to organize and plan sequential steps in a process
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hindsight bias
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belief that, in retrospect, the outcome was predictable when the outcome wasn’t predictable due to various uncontrollable factors
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hubris
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overinflated belief in oneself
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lifestyle business
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business that provides incomes similar to other forms of employment
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Nominal Group technique
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group decision-making process that requests multiple rounds of responses and discussions of response
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noncompete agreement
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formal agreement that the person signing the document will not work for another organization that is a direct competitor of their current employer during employment and usually for a specified length of time after employment ends
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nondisclosure agreement
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formal agreement that the person signing the document will not sharing proprietary information with outside sources
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planning fallacy
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creation of a plan that is too optimistic and not aligned with conservative assumptions
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serial entrepreneur
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entrepreneur who becomes involved in starting multiple entrepreneurial ventures
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social capital
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goodwill that is created through helping someone else
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status quo bias
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pattern of relying on previous actions and results as the accepted pattern and outcome with a bias against change or new information or new results