Venture Capital Study Guide: 46 Flashcards from Pre-Seed to Carried Interest
Deck VZ7376 in 46 cards: the funding ladder, two and twenty, GP and LP, pro-rata rights and no-shop clauses, plus the 21 cards that duplicate another deck.
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Deck VZ7376 — "Fundraising & Venture Capital" is 46 cards of clean, term-first definitions: no filler, no broken cards, no padding. But before you start it, run one check. If you have already studied deck ML7032 (Startup & Product Terms), 21 of these 46 cards repeat terms you own — seed funding, angel investor, term sheet, pre- and post-money valuation, unicorn, IPO, due diligence, product-market fit, liquidation preference, up and down rounds, burn rate, runway, convertible note, SAFE, bootstrapping, pitch deck, vesting, cliff, equity crowdfunding. Same terms, reworded definitions. Suspend one copy — keep VZ7376's, which carries the arithmetic (post-money = pre-money + new investment) and the numbers (4 years with a 1-year cliff).
Study this deck: Fundraising & Venture Capital
1 / 10Venture capital (VC)
Tap the card for the answer · swipe right if you knew it, left if not
The remaining 25 cards are the reason to study it: they are the other side of the table, the fund's side.
Nine cards worth the deck
| Front | Back |
|---|---|
| "Two and twenty" fee structure in VC | A 2% annual management fee plus 20% of profits as carried interest |
| Carried interest | The share of profits (typically 20%) paid to the fund's general partners as a performance incentive |
| General partner (GP) in a VC fund | The managers who make investment decisions and typically contribute 1–2% of fund capital |
| Limited partner (LP) | Passive investors who provide the majority of the capital but make no investment decisions |
| Vintage year of a VC fund | The year the fund closed and began investing, used to compare fund performance |
| Pro-rata rights | The right of existing investors to join future rounds to maintain their ownership percentage |
| Term sheet's no-shop clause | A provision preventing the company from seeking other investors for a set period |
| ARDC's most successful investment | Digital Equipment Corporation in 1957, returning over 1200x — 101% annualized |
| What percentage of US startups get VC funding? | About 0.05% — roughly 600–800 out of nearly 2 million businesses created annually |
The full vocabulary
The ladder: pre-seed, seed, Series A, growth capital, bridge financing, venture debt, equity crowdfunding, bootstrapping. Fund mechanics: GP, LP, two and twenty, carried interest, vintage year, deal flow, entrepreneur-in-residence, Sand Hill Road. Deal terms: term sheet, no-shop clause, lead investor, pro-rata rights, liquidation preference, dilution, vesting, cliff, convertible note, SAFE. Company-side: traction, burn rate, runway, product-market fit, pitch deck, unicorn, accelerator, incubator, due diligence, exit strategy, IPO.
The deck names the instruments, never their settings
This is the one real gap, and it is exactly where term sheets are negotiated. Card 29 defines a convertible note and card 30 a SAFE — but neither mentions the valuation cap or the discount, which are the only two numbers anyone argues about. Card 21 defines liquidation preference without the 1x / participating vs non-participating distinction that decides who gets paid what. Card 15 defines dilution with no anti-dilution ratchet and no option pool anywhere in the deck.
Write those five cards yourself, then add five more that do the arithmetic: cards 13 and 14 give you post-money = pre-money + new money, but nothing in the deck ever computes an ownership stake. A $2M cheque at an $8M pre-money is 20% of a $10M post-money. Drill that with five made-up rounds and the whole vocabulary locks in.
Three cards to fix
Card 10's front is corrupted — Two and twenty" fee structure in VC carries a stray closing quote. Card 6 refers to "Series B, C, and beyond" but no card defines Series B or Series C: write the two missing rungs. And card 45's ARDC is never introduced — American Research and Development Corporation, founded 1946, the first publicly traded VC firm, whose DEC bet is the industry's founding legend. Card 46's own maths also drifts: 600–800 out of 2 million is 0.03–0.04%, not 0.05%; date-stamp it rather than trusting the round number. All 46 hint fields are empty, so there is room.
Deck code VZ7376, 46 cards, in the Flip It library — sign in at flip-it.app.
Related: 139 Startup & Product Terms and 60 Business Model and Revenue Terms.
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