| Term | Definition | ||||||||||||||||||
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| % Equity | Percentage of capital (after the capital increase) that will be held by the investors in the event that the funding round is executed in its entirety. | ||||||||||||||||||
| Capital Increase | Legal means whereby, upon prior approval of the board of directors and the general shareholders’ meeting, an increase in the company's share capital is carried out either by issuing new shares or increasing their par value. It must be done via a public deed and registered in the Companies Register. | ||||||||||||||||||
| Investment Portfolio | A portfolio of investments or securities is a certain combination of financial assets in which someone invests. An investment portfolio may consist of a combination of fixed income and equity instruments. | ||||||||||||||||||
| CNMV | The National Securities Market Commission (CNMV) is an agency under the Secretary of State for the Economy and Business Support of the Ministry of Economy and Competitiveness, founded in 1988 and responsible for monitoring the securities markets in Spain | ||||||||||||||||||
| Deal Flow | Number of potential investments that an investor reviews over a certain period of time. | ||||||||||||||||||
| Default | A financial default, non-payment of the debt or suspension of payments arises when a person or organisation cannot meet the payment of the interest or principal of a debt on its due date. It occurs when a debtor cannot comply with the legal obligation to pay off their debt. | ||||||||||||||||||
| Dividends | The dividend is the part of the profit that is distributed between the company's shareholders. It is the remuneration that shareholders receive for their ownership in the company. The amount is variable and is based on the annual results of the company. The dividend associated with a project is a percentage of the profits that the entrepreneur undertakes to distribute to shareholders when the company overcomes the initial stage of major expenses and investments and begins to generate recurring profits. It is a way to make a gain from an investment other than via an Exit. This percentage is included in the Partners Agreement and gives promoters an obligation with new investors. | ||||||||||||||||||
| Equity Crowdfunding | Equity Crowdfunding, Crowdequity, or Crowdfunding Investment, is an alternative means of investment that allows all investors, both natural and legal persons, to transparently invest in companies with growth potential through a technological platform. The investment is made by acquiring shares or shareholdings in the chosen company, thus participating in the future profits of the invested company (both for profit sharing and for acquisition by another company). | ||||||||||||||||||
| ESG | ESG investing (Environment, Society, Governance) seeks to incorporate sustainability criteria and corporate ethics into investment decision-making. | ||||||||||||||||||
| Core strategy and Core Plus | It is a real estate investment strategy with low risk/profitability ratios. It will invest normally in “core” properties, although some of them will need an improvement. Core properties mean those well-located properties, with recent construction and with a high occupancy rate of tenants with high credit quality. The profitability in these investments is mainly obtained by a lease recurrent revenue and a capital gain close to inflation. | ||||||||||||||||||
| Added Value strategy | It is a real estate investment strategy with medium-high risk/profitability ratios. This strategy requires buying a property, improving it in some way (renovations, changing tenants, etc.) and selling it at the appropriate time, generating a capital gain. Properties are considered "Value Added" when they present operational or management problems, require physical improvements and or suffer from capital or debt constraints. | ||||||||||||||||||
| Opportunity strategy | It is a real estate investment strategy with high risk/profitability ratio. Real estate will require a high degree of improvement. These strategies may involve investments in developments, in land, including agricultural land, and in niche real estate. | ||||||||||||||||||
| Exit | Procedure in which the investor or investors can make a profit from their investment in a company. The most common mechanisms are an IPO or the sale of all or part of the invested company. | ||||||||||||||||||
| Fair Value | Fair Value (https://fairvalue.io) is a professional tool that will help you as an entrepreneur to know the actual situation of your project through a complete valuation report, based on a proprietary algorithm developed by our specialists in risk analysis, investment and finance. Fair Value offers investors, accelerators and incubators a model that facilitates their decision making, as it allows them to objectively compare the quality and situation of totally heterogeneous projects. The Advanced Fair Value Report provides a global Scoring and an area-based startup breakdown, an estimated valuation range, a complete X-ray of the project including its most outstanding strengths and weaknesses, and a set of recommendations for the entrepreneur. |
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| Fee | The amount to pay for a service. | ||||||||||||||||||
| IBEX 35 | The main reference stock index of the Spanish stock exchange produced by Bolsas y Mercados Españoles (BME). It is formed of the 35 most liquid companies listed on the Electronic Stock Market Interconnection System (SIBE) of the four Spanish stock exchanges (Madrid, Barcelona, Bilbao and Valencia). | ||||||||||||||||||
| Tax Incentives | It refers to the tax reduction contemplated in art. 68.1 of the IRPF law that allows the deduction (if a series of requirements are fulfilled) of 50% of the capital invested in new or recently created companies. For further information, please consult https://www.fellowfunders.es/guia-incentivos. Where private professional advice is recommended. Saber más » | ||||||||||||||||||
| Objective Assessment Report | This document details the information that has been evaluated and analyzed by Fellow Funders' team of analysts (according to its own valuation and scoring models) to determine the valuation (Fair Value) of a company/project. | ||||||||||||||||||
| Objective Feasibility Report | This document details the information that has been evaluated and analyzed by Fellow Funders' team of analysts (according to its own financing and scoring models) to determine the feasibility of a company/project. | ||||||||||||||||||
| Total investment | Total investment volume of the business, including equity and external funds | ||||||||||||||||||
| Reference investor | A professional investor who has knowledge and experience in the alternative investment world and who supports and/or leads investments in projects. | ||||||||||||||||||
| Know-How | Technical and administrative knowledge essential to running a commercial process that is not protected by a patent but is decisive for a company to be commercially successful. | ||||||||||||||||||
| Lemon Way | Lemon Way is an independent payment institution registered and authorized by the Bank of France, as well as authorized by the Bank of Spain (according to art. 25, Directive 2007/64/EC, and art. 11 of Law 16/2009). Its aim is to offer secure payment solutions (www.lemonway.com). The funds transferred to your Wallet are managed by the Lemon Way payment institution and are deposited at BNP Paribas. |
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| Mark to Market | Daily revaluation process of an investment that reflects its current value instead of its acquisition price or market book value. | ||||||||||||||||||
| Real Estate Loan Business | Real estate business that obtains its profitability through the profit generated by a loan. | ||||||||||||||||||
| Real Estate Business in capital gain | Real estate business which obtains its profitability thanks to the capital gain generated because of the sale of assets. | ||||||||||||||||||
| Real Estate Business for Rent | Real estate business which obtains its profitability with recurrent revenues due to rent of operation or lease agreements. | ||||||||||||||||||
| Partners agreement | Contract between partners that establishes a series of internal norms and rules on the relations of the partners of the company and their rights and obligations. These are generally different from those established in the Law. They usually regulate the transfer of participations or shares, the functioning of the corporate bodies, or clauses of permanence and competence. In case they exist, we recommend professional advice for their acceptance. | ||||||||||||||||||
| Term | The expected length of the project in months. | ||||||||||||||||||
| Pre-Money | Valuation of a company prior to the capital increase through which the funding round is executed. | ||||||||||||||||||
| Stakeholding price | A stock is an indivisible and cumulative part of the capital of a Limited Liability Company that confers to its holder the status of partner, conferring on him/her the rights recognized by law and in the bylaws. In the case of a corporation, it is called a share. The Price is the amount to be paid by the investor for each stock or share in the capital increase of the funding round. It is the sum of its nominal value and the issue premium. | ||||||||||||||||||
| Investor’s Deck | Investor Deck is a presentation of your project which is oriented to make it known for the potential investors. It should be perfectly reflected the product or service offered by the company, the target market it is directed to and the business model it has developed in order to monetize the idea properly. Is also important to highlight the relevant metrics the company has achieved (previous years turnover, CAC, LTV, etc.), as well as a road map showing concisely the company’s action plan for the following years. Finally, the amount the company is seeking for this round and the destination of the funds should be indicated. |
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| SME | The European Commission states that a company is an entity performing an economic activity, regardless of its legal form. The three main criteria to determine the type of company, and therefore whether it is an SME or not, are the number of employees, the turnover and its balance sheet. | ||||||||||||||||||
| Expected anual profitability | This is the annualized total return. It represents the average annual return that an investment is expected to earn over a given period. It is expressed as a percentage and is especially useful for comparing investments with different durations. | ||||||||||||||||||
| Expected total profitability | The total return aimed on the project. It represents the objective profit, and it is expressed as a percentage of the investment carried out. | ||||||||||||||||||
| Investors representative | In certain funding rounds, the developer requires investors to be represented by a single person. For this purpose, they must sign a syndication agreement. | ||||||||||||||||||
| ROE | Return on equity. This is an indicator that measures the return on capital and is expressed as a percentage. It is calculated by dividing net income after taxes by shareholders' equity. | ||||||||||||||||||
| ROIC | Return on invested capital. It is a ratio that can be calculated dividing the total returns of the investment between the invested capital. | ||||||||||||||||||
| Scoring | A process based on 10 pillars that assign a score to the project. Fellow Funders only publishes projects that score over 65 points (out of 100). The 10 pillars are: 1. Investible: The project has to be susceptible to investment, it is not “anything goes”. 2. Team: a balanced team committed to the project, with the appropriate abilities to manage it. 3. Reputable: the entrepreneurial team must be above any suspicion or evidence of fraud and must have always acted honourably in their professional conduct or it is discarded immediately. 4. Market: the growth data is consistent with the potential market aimed at and that the project is being implemented at the right time. 5. USP (Unique Selling Point): what differentiates them from the rest, or what is on the market. 6. Competition: who says there is no market without competition? The important thing is to know the competition well, and that is not dominant. 7. Business model, scalable, profitable, with limited financing needs. 8. Traction: validated model, with metrics, growth vectors oriented to financial variables. 9. Projections: how can expenses and revenues progress and why. 10. Exit: every investor wants to know what the divestment process will look like. The projects have a standard partners agreement. | ||||||||||||||||||
| Scoring ESG | ESG investing (Environment, Social, Governance) seeks to incorporate sustainability criteria and corporate ethics into investment decision-making.
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| Real Estate Scoring | Analysis and assessment system of real estate businesses which is useful to compare and detect some possible risks, in both the project founder and in the business viability. | ||||||||||||||||||
| Start-ups | A start-up could be defined as a newly created company with huge possibilities for growth and, sometimes, a scalable business model. Although start-up can refer to a company in any field, it is usually used for those with a strong technological component and are related to the world of IT and the internet. Due to these characteristics, technology start-ups tend to differentiate themselves from other new companies in their growth possibilities and capital needs. | ||||||||||||||||||
| Minimum Ticket | Minimum amount that an investor must disburse to invest in each funding round. In each round, it will imply a different number of shares to be subscribed. | ||||||||||||||||||
| IRR | It is the interest rate generated by a project and is responsible for measuring the profitability of an investment. It expresses the percentage of profit or loss it will have. It is one of the main ratios for evaluating an investment and must be higher than the cost of capital for the project to be investable. Its calculation assumes that the funds generated throughout the project can be reinvested at the same rate. |