The quantum founder's glossary

A preferred-stock protection that grants extra conversion shares if a later round prices below what the investor paid.

A loan that converts into equity at the next priced round, carrying interest and a maturity date unlike a SAFE.

A percentage off the next round's share price granted to convertible holders, rewarding risk taken before the round existed.

A financing priced below the previous round's share price, triggering anti-dilution and a hard reset of the equity story.

A clause letting a defined majority force the remaining shareholders to join an approved sale, so a minority cannot block an exit.

The share count assuming every option, warrant and convertible becomes shares: the honest denominator for any ownership claim.

The investor's right to take their money out first when the company is sold, before common shareholders receive anything.

A clause letting an early convertible investor adopt the better terms of any later convertible issued before conversion.

Shares reserved to grant equity to employees, usually created or topped up before a round, at the existing holders' expense.

A provision that penalizes investors who do not invest their pro rata in a future round, usually by stripping their preferred rights.

Two valuation conventions: post-money is pre-money plus the new round, and investor ownership equals investment over post-money.

The right to invest in the next round in proportion to your current stake, so your ownership percentage is not diluted.

The right to match a third party's offer before shares can be sold to them, controlling who joins the cap table and slowing secondary sales.

A convertible instrument granting future equity at the next priced round, with ownership fixed as a share of the post-money valuation cap.

The ceiling valuation at which a SAFE or convertible note converts to equity, fixing the investor's minimum ownership whatever the next round prices.

The right to buy shares at a set price for a set period, often attached to venture debt or a bridge as extra upside for the investor or lender.

An interim financing, usually convertibles from existing investors, that extends runway to a milestone the next priced round needs.

The cash a company consumes per month: gross burn counts total outflows, net burn subtracts cash coming in.

The organized set of documents an investor examines during diligence: corporate, IP, financial, technical and team records.

The investor's structured verification of a company's claims across team, technology, market, legal and finance, before money moves.

A later investment by an existing backer into a subsequent round. Whether your investors have reserves to follow on is a quiet make-or-break.

The investor who prices the round, negotiates the terms, signs the largest cheque and anchors the rest of the syndicate.

A round released in tranches, each unlocked by hitting an agreed milestone, so capital follows progress rather than arriving all at once.

The number of months the company can operate before cash runs out, at the current net burn rate.

Signing is agreeing the deal; closing is when conditions are met and money actually moves. The gap between them carries real risk.

The summary of a round's economics and control terms, mostly non-binding, signed before lawyers draft the definitive documents.

Backlog is contracted work not yet delivered; pipeline is unconverted opportunity. Conflating the two overstates how committed revenue really is.

Net cash burned divided by net new ARR: how many dollars a company burns to add one dollar of recurring revenue. Lower is better.

Whether a company can commercialize without infringing others' patents, a sharper risk in quantum given dense portfolios held by large incumbents.

Whether a company builds the whole quantum system or one enabling layer (control, cryogenics, lasers, software); it decides the business model and moat.

Assignment transfers ownership of IP to the company; a license only grants rights to use it. The difference sets what the company truly controls.

An error-corrected qubit built from many physical qubits, the unit that matters for useful computing and a key roadmap and valuation marker.

A mostly non-binding statement that a counterparty intends to buy, partner or invest, signalling interest without committing cash.

Noisy Intermediate-Scale Quantum: today's era of mid-size, error-prone machines without full error correction, the commercial context for most claims.

One-off engineering paid by a customer to build or adapt something for them: real cash, but not recurring revenue and not a product.

Evidence of commercial pull before real revenue exists: design partners, paid pilots, LOIs and a credible path to first contracts.

The point where a quantum computer solves a useful problem better than any classical machine; the headline claim diligence scrutinizes hardest.

A defined technical achievement that materially de-risks the technology and re-rates the company, the unit of value creation pre-revenue.

A 1-to-9 scale rating how far a technology stands from proven deployment, born at NASA and now standard in deeptech diligence.

A company built on university research, where who owns or licenses the underlying IP, and on what terms, can make or break the investment.

France's research tax credit, a cornerstone of French deep tech funding: a percentage of eligible R&D spend, refundable for young and small companies.

Funding for technology with both civilian and defense or security applications, a large non-dilutive pool that carries export-control and ownership strings.

The European Innovation Council's flagship for deep tech SMEs: a blend of grant and direct equity, highly competitive, gated on technology readiness.

A grant is money you keep; a repayable contribution must be paid back, often conditionally on success. The difference changes the true cost of the funding.

Money that does not cost equity: grants, tax credits, repayable advances and prizes that extend runway without diluting the cap table.

Canada's Industrial Research Assistance Program: non-repayable contributions plus advisory support for innovative SMEs, delivered through industrial advisors.

Canada's federal R&D tax-credit program, a major non-dilutive source: refundable for Canadian-controlled private companies, paid after the fiscal year.

Combining several non-dilutive programs on the same project, subject to rules that often cap the total and reduce one credit when another is taken.

A venture arm of a large company, investing for strategic as well as financial return. A common, double-edged source of capital in quantum.

What a fund is set up to back: sector, stage, geography and cheque size. Matching it is why most quantum rounds are won or lost before the pitch.

A fund's general partners manage it and pick investments; limited partners supply the capital. Their economics and clock shape every deal you sign.

The body inside a fund that approves or kills a deal. The partner you meet must sell your company to it, often without you in the room.

A fund whose thesis is dedicated to quantum technologies, able to price the science where a generalist cannot, but drawn from a small universe.

The group of investors who together fund a round: a lead who prices and anchors it, plus participating co-investors who fill it out.