The private company glossary, organized by the business question behind the term.
These are the mechanisms behind ownership, authority, control, board oversight, financing, transfer rights, exits, and founder equity. The definition matters. The business consequence matters more.
A governance term becomes real when the business reaches the mechanism.
Reference map
Start with the business question, then check the term.
Most owners arrive here because something is stuck, not because they woke up wanting a legal definition. This map keeps the terms grouped by the business situation they usually explain.
Business problem pages
When the term is pointing at a business problem.
Business Problems
Use this when the term points to a symptom the owner needs to name.
Decision hubBusiness Decision Making
Use this when the term affects who decides, when, and with what information.
Check-first pageHow To Figure Out What Is Wrong
Use this when the definition is not enough and the first inspection point matters.
Owner dependenceFounder Dependency
Use this when authority, approvals, or exceptions keep returning to the owner.
Authority mapDecision Rights Matrix
Use this when the term is not enough and the business needs to map who decides.
Business coachingBusiness Coaching
Use this only when the definition has exposed a live problem that needs a first move.
Start here
Six terms that explain the system.
The Governance Gap
The distance between how decisions are supposed to move and how they actually move.
Decision authoritySMART Targets
Specific, measurable, achievable, relevant, and time-bound targets that reality can grade.
Control and consentDecision Rights
Clarifies who may decide what, at which threshold, and with whose approval or input.
Control and consentConsent Rights
Approval rights that stop defined company decisions from moving without a named holder's consent.
Exit and transferDeadlock Clause
Defines what happens when co-founders, shareholders, or directors split and the company still needs a decision.
Board oversightFiduciary Duty
The obligation directors and officers carry to act for the company, not for themselves.
Capital structureLiquidation Preference
Decides who gets paid first when the company sells, recapitalizes, or winds down.
If the term describes a live decision
A term becomes real when the business reaches the mechanism.
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Browse by pressure
Choose the pressure you are actually under.
Who can stop, approve, or force the decision.
Use this when the real issue is authority: who gets a say, who has a veto, and what cannot move without approval.
The Governance Gap
The distance between how decisions are supposed to move and how they actually move.
Control and consentDecision Rights
Clarifies who may decide what, at which threshold, and with whose approval or input.
Control and consentConsent Rights
Approval rights that stop defined company decisions from moving without a named holder's consent.
Control and consentReserved Matters
Decisions management cannot make without approval from a defined person or group.
Control and consentVeto Rights
Gives a defined person or group the power to stop a specific company decision.
Control and consentProtective Provisions
Class-level vetoes over major company decisions written into the share terms.
Control and consentSupermajority Vote
A higher-than-simple-majority threshold for decisions that need broader approval.
Control and consentQuorum
The minimum participation required for a vote or meeting decision to be valid.
How authority moves below the founder.
Use this when the issue is not whether a decision matters, but who is allowed to make it, approve it, escalate it, or carry it.
Approval Matrix
Maps who approves what at which threshold so decisions do not disappear between roles.
Decision authorityDelegation of Authority
Transfers decision power down the org with defined scope, limits, documentation, and revocation.
Decision authorityShadow Governance
The informal decision system that runs beside the formal one and often replaces it under pressure.
Decision authorityChain of Command
The formal authority hierarchy that decides where escalation should go before someone skips levels.
Decision authoritySigning Authority
The formal power to bind the company through contracts, commitments, and legal documents.
Decision authorityAuthorization Limits
The thresholds within which a role can approve, commit, or sign without escalation.
Decision authoritySMART Targets
The target format that separates real movement from attractive activity.
What the cap table says before pressure arrives.
Use this when the question is ownership, dilution, vesting, or whether the equity still matches the contribution.
Founder Vesting
Ties founder equity to time and contribution so the cap table follows the work still being done.
Founder equityReverse Vesting
Allows the company to reclaim unvested founder shares if contribution stops early.
Founder equityOption Pool
A reserved block of shares for grants that can shift dilution before anyone receives options.
Founder equityPreemptive Rights
Lets existing shareholders buy new shares before outsiders so ownership can be protected.
Founder equityPro Rata Rights
Lets existing investors maintain ownership percentage in future financing rounds.
Capital structureAnti-Dilution Provision
Adjusts preferred share conversion when a future round prices below the original round.
How the company is governed when the stakes rise.
Use this when the issue is board structure, independence, information flow, director duty, or financial oversight.
Independent Director
A voting board member structurally separate from management, investors, and material conflicts.
Board oversightBoard Observer Rights
Meeting access and board materials without a vote, with influence that still needs boundaries.
Board oversightAudit Committee
A board sub-group responsible for financial reporting, controls, auditor oversight, and risk.
Board oversightFiduciary Duty
The obligation directors and officers carry to act for the company, not for themselves.
Board oversightBusiness Judgment Rule
The protection directors earn when decisions are informed, diligent, conflicted out, and recorded.
Board oversightInformation Rights
Regular access to financial statements, board materials, and operating data on a defined schedule.
How ownership moves, exits, or gets forced into motion.
Use this when shares may move, an owner may leave, a sale is under consideration, or the deal structure has hidden friction.
Drag-Along Rights
Allows an approved majority to require minority shareholders to join a company sale.
Exit and transferTag-Along Rights
Lets minority shareholders sell on the same terms when a majority holder sells.
Exit and transferRight of First Refusal
Gives existing owners the first chance to match a proposed share transfer.
Exit and transferBuy-Sell Agreement
Defines how ownership transfers when an owner exits, dies, is removed, or must be bought out.
Exit and transferShotgun Clause
Lets one owner name a price and forces the other to buy at that price or sell at that price.
Exit and transferDeadlock Clause
Defines what happens when co-founders, shareholders, or directors split and the company still needs a decision.
Exit and transferEarn-Out
A portion of purchase price paid only if post-closing performance targets are met.
Exit and transferEscrow Holdback
Purchase price held back at closing as security against post-closing claims.
Exit and transferReps and Warranties
Statements about the company that allocate risk when a statement proves untrue.
Exit and transferMAC Clause
Lets the buyer walk or renegotiate if a defined adverse event hits before closing.
Exit and transferNo-Shop
Stops the seller from engaging other buyers while the deal window is controlled.
Exit and transferBreakup Fee
A defined payment if a signed deal terminates under specific triggers.
Exit and transferExclusivity Period
The window where the seller stops shopping the deal while the buyer works toward closing.
Where money enters and the ownership math changes.
Use this when the question is investor terms, conversion, payout order, or the price of capital across rounds.
Liquidation Preference
Decides who gets paid first when the company sells, recapitalizes, or winds down.
Capital structureConvertible Note
Debt that converts into equity at a future priced round, usually through a cap or discount.
Capital structureSAFE
A future-equity financing instrument that converts at a priced round without interest or maturity.
Capital structureAnti-Dilution Provision
Adjusts preferred share conversion when a future round prices below the original round.
Founder equityPro Rata Rights
Lets existing investors maintain ownership percentage in future financing rounds.
Founder equityOption Pool
A reserved block of shares for grants that can shift dilution before anyone receives options.
Board oversightInformation Rights
Regular access to financial statements, board materials, and operating data on a defined schedule.
A-Z index
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Route map
Choose by what is still on your desk.
Use the next page only when it clarifies the next real decision.
Reference terms
Planning terms stay reachable from the glossary.
A useful term when the next move keeps staying abstract.
DelayProcrastination LoopThe pattern behind important work that keeps getting displaced.
PlanningRPM-Style Outcome PlanningA reference term for outcome-first planning language.
PrioritizationEat the FrogA familiar productivity method compared against owner-level decisions.
SystemGetting Things DoneA capture-and-clarify method used in planning comparisons.