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Okay, and now we are going to talk about basic concepts.

Why to explain some basic concepts?

Probably some of those concepts you already know that.

But if you are moving in the startup world, in the start up ecosystem and

you talk with other investors, entrepreneurs or whatever, and

they say something, you need to know that [LAUGH] what they're saying.

You can ask, what does it mean?

But they wouldn't teach some of those concepts.

The first one is a startup.

The startup, probably you know what's that.

It's a project, it's an idea,

it's a team of a group of people that are just trying to do a service or product.

That's a startup.

It's like a commando,

it's a very close thing that's making a great change in the market.

And a startup in the legal sector could be a small company,

could be a small group, it could be a group inside a big

corporation that are trying to do something different.

An entrepreneur, probably you are an entrepreneur and you don't know it.

An entrepreneur is a person who's trying to change something,

a person who's trying to do something different.

For example, big entrepreneurs, you know Michael Page,

you know Bill Gates, you know Steve Jobs, but

I think that they all are entrepreneurs.

Those person who comes from Africa to Europe,

just crossing the Mediterranean Sea, they want to change something.

Those person who cross all America,

from South America to North America, those are entrepreneurs.

Imagine Christopher Columbus,

he was probably the biggest entrepreneur in the world.

Yes, Christopher Columbus, he raised money from the Kingdom of Spain for

an idea, discover new world or a new way to arrive to a place.

The investment was three ships and

the return of investment was a huge continent.

Another concept, MVP, minimum viable product.

This is a concept that is related to the linear startup model.

That is, create something at its core that solve a problem and

with just that minimum product, with that minimum service,

you start to try to sell and you have both.

Business model that is very important to answer that question.

If someone asks, okay what's the business model of your business, of your product,

you need to explain how you're going to get paid for something.

For example, the business model of Netflix.

The business model of Netflix is just subscriptions.

This business model of Rocket Lawyer, subscriptions, different slant.

Then you need to explain what's your business model.

For example, if you're a marketplace, who is going to pay, the lawyers or

the customer that are looking for a lawyer?

Business plan, I have already explained and probably you know that I don't

love business plan, but a business plan could be different ways of business plan.

A business plan could be just one page,

what is called the deck, or three, ten, or whatever pages that explain your business.

Incubator, there are a lot of new concept, incubator, accelerator, what's that?

An incubator is a place, for example Founder Institute.

Founder Institute, that just take you and validate if your

business idea works, and just push you to start your business.

An accelerator, an accelerator is okay, you have proof

that you already have a project or a business, that it's working.

And they help you to grow, for example Y Combinator.

Y Combinator helps startups that already exist to just go up.

There are very, very well known cases of Y Combinator.

Then we can talk about your company, that could be a limited liability company, and

we need to start talking about equity, stock, debt, what's that?

Equity is part of your company or a stock, debt is when you take money.

Also probably you are interested in talking in business angels.

What's a business angel?

It is someone to invest in companies.

I used to invest in companies.

I don't have a VC, I don't have a huge amount of money,

but with my money, I invest in startups.

Who used to be or who are those business angels?

Business angels are entrepreneurs that already have a good business.

Professional that work in a large corporation that they have money, but

also VC managers that they put their first money.

The angel investor are those people who believe in you, in your project, and

put the first money, the seed money.

VC, venture capital, venture capital is some

company that his business is putting money and take money back.

Remember, the business of a VC, that they are professionals,

is putting money in your company and try to multiply the money that they put

when they sell the stock or when the company goes public.

Then, very important, concepts like customer lifetime value.

What's the customer lifetime value?

The customer lifetime value is all the money that

one client is going to pay to you all the time that he's in your company.

I will repeat.

Customer lifetime value is all the money that the customer

will pay to you during all the time that he's in your company.

For example, let's imagine that Rocket Lawyer acquire a customer.

The customer lifetime value of that customer is all the months or

all of the years that he's going to pay, and put all that amount together.

Why that concept is important?

Because, the customer lifetime value is the maximum

price that you could pay to acquire a new client.

Customer acquisition cost, the customer acquisition cost is

the money that you need to pay to gain a new customer.

The customer acquisition cost is the money that you need to pay

to have a new customer.

ROI, return of investment, that is very, very, very important.

Your project is a company and your company want to succeed.

And to know if that company succeed, probably, is the return of investment.

For example,

if some people put more in your company what would be the return of investment?

How much money they are going to get back?

There are a lot and lot of more concepts in the entrepreneur ecosystem.

These are the most relevant and probably the concepts that you need to know.

Please, don't lose time knowing and memorizing all those concepts,

just, you need to just know it, thanks.

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Glossary and basic concepts

Legal Tech & Startups

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