Capital Allocation

An overview of share buybacks where companies repurchase stock to reduce outstanding shares, manage the cap table, or provide liquidity, distinct from dividends.

A clear explanation of the hurdle rate, detailing how startups use minimum acceptable returns to assess risk, compare against IRR, and make logical capital allocation decisions.

Payback Period measures how long it takes to recover an investment cost. It prioritizes liquidity and risk reduction, essential for startups managing tight cash flows.

A blind pool is an investment fund where capital is committed before specific assets are identified, relying heavily on the fund manager’s track record and strategy.