A Practical Guide to Angel Investing (2nd Edition)

Institutional Investors Organizations that professionally invest, including insurance companies, depository institutions, pension funds, investment companies, mutual funds and endowment funds. IPO Initial Public Offering. The sale or distribution of shares in a portfolio company to the public for the first time. IPOs are often an opportunity for the existing investors to receive significant returns on their original investment. During periods of market downturns or corrections, the opposite is true. IRR Internal Rate of Return. A typical measure of how investors measure performance. IRR is technically a discount rate: the rate at which the present value of a series of investments is equal to the present value of the returns on those investments.

Issued Shares The amount of common shares that a corporation has sold (issued). Issuer Refers to the organization issuing or proposing to issue a security.

Key Employees Professional management attracted by the founder to run the company. Key employees are typically retained with warrants and ownership of the company. Key Person Insurance Insurance to protect the business against interruptions caused by the loss of one of its key employees or executives.

How to Achieve Good Returns

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