Small Business Glossary

Get the fastest LLC formation online with worry-free services and support to start your business

Starts at $49 + state fees and only takes 5-10 minutes

ZenBusiness Small Business Glossary

This is our glossary of small business terms. Our glossary terms range from small business tax terms to business terms every entrepreneur should know. Starting a new business is like learning a new language, and our small business glossary will help you learn the meanings of terms and topics to help you along the way.

A | B | C | D | E | F | G | I | L | O | P | R | S | T | U | V | W 

A

Acquisition: The definition of acquisition in a business context is a circumstance where one company purchases control of another company.

Amendment: Making certain changes to incorporated business entities like LLCs and corporations requires you to file an amendment to your formation documents with the state.

Angel Investor: An angel investor can help entrepreneurs and startups get the funds they need to help their business idea become a reality or their business grow.

Apostille: A special type of government-issued certification for use in another country.

Articles of Incorporation: The document filed with a state government agency (usually the Secretary of State) to create a corporation.

Asset: Assets are any item of value, whether tangible or intangible, that provide some current or future benefit to your business.

B

B Corporation: The nonprofit organization B Lab certifies companies as B Corporations. To gain such certification, a company must meet high performance, accountability, and transparency standards.

Bond: Bonds are debt securities that are issued by companies and governments and sold to investors. As with most debt, bonds have maturity dates, at which point the principal amount must be paid back in full.

Business Plan: A business plan is defined as a guide that lays out what your business’s goals are and how you plan to meet them.

C

C Corporation (C Corp): C Corps are the most popular type of corporation. It taxes its owners (shareholders) separately from the business. All C Corps must have the following governing positions: president or CEO, treasurer, and secretary.

Consolidation: The definition of “consolidation” in business generally refers to combining different departments of a company into one larger unit or combining separate companies into one.

Copyright: It’s simply the right to copy. A person who owns the copyright to a piece of intellectual property is the only person who can copy or give permission to copy it.

Corporation: A corporation is a legal entity that is separate from its owners. A corporation can be considered a “legal person” under the law, meaning it can possess the rights and responsibilities of an individual.

D

DBA: A DBA name is a legal form required whenever a company operates under a name that’s different from its officially registered name. 

Debt Financing: Debt financing is used by many small businesses when they need to raise money for working capital or asset purchases. Here’s a definition of debt financing and the advantages and disadvantages of using it.

Dissolution: Dissolution is the official closure of a business entity with the state. You likely need to file documentation with the state to make this official.

Dividend: Payments made to shareholders and are a way to share profits with investors. 

Domain Name: A domain name is a website’s “name.” These names can help your business find additional success.

E

eCommerce: The act of selling goods or services online. If you sell through your own company website, eBay, Amazon, or on any other digital platform, you’re engaging in eCommerce.

EIN: An EIN is a unique, nine-digit number used to identify a business entity. This identifier is very similar to a Social Security Number (SSN), but for businesses rather than individuals. 

Entrepreneur: Being an entrepreneur is exciting. It involves creating or offering products and services that the public may have never seen before. However, you’ll need a go-getter mentality and lots of grit to be successful (not to mention product research, funding, etc.).

F

Fiduciary Duty: A fiduciary duty is a special type of legal obligation that one party owes to another.

G

Guarantor: A guarantor is a person who guarantees something for someone else. In the financial world, the guarantor definition is a person or entity who promises to pay for something on another person’s behalf if that person doesn’t.

I

Incorporation: The formation of a new corporation, which is a legal entity formally recognized by the state it’s located in.

IPO: An IPO (initial public offering) is when a company first sells shares of its stock to the public.

IRS: Business owners should know what the IRS is and how it works. They will need to be familiar with how their business will be taxed.

L

Liability: Businesses have many kinds of liabilities. They include long- and short-term debt as well as potential legal liabilities incurred when operating the business.

Limited Liability Partnership: A limited liability partnership is a type of business entity structure with at least two partners. A distinguishing characteristic of an LLP is limited personal liability, which can be extremely beneficial in running a business.

Limited Partnership: A limited partnership is made up of at least two people. One is the general partner and this person oversees business operations. The others are known as limited partners and their responsibilities don’t involve the business’s management.

Limited Liability Company (LLC): An LLC is a legal business entity that provides limited liability protection, meaning that the owners are usually protected from the business’s liabilities and debts.

Line of Credit: A line of credit is a loan that operates like a credit card. You have a certain amount to draw from and use only as much as you need.

O

Outsourcing: When one company hires another company or person to handle projects.

P

Patent: A patent is a type of intellectual property granted to an inventor to help protect their invention from being made or sold by competitors. 

R

Registered Agent: A registered agent is a person or entity that serves as a business’s legal point of contact. 

S

S Corporation (S Corp): An S corp is a tax classification. The “S” refers to Subchapter S of the Internal Revenue Code. LLCs and C corporations (the default form of corporation) can apply to be taxed as an S corp if they meet the IRS’s criteria. 

Share: A share is a unit of ownership of a corporation. When a corporation is created, the creators of the business will issue a certain amount of shares or ownership units in the company.

Security: Securities are tradable financial instruments used to raise capital in public and private markets.

Sole Proprietor: A sole proprietorship is an unincorporated business that has only one owner. Sole proprietors are required to pay personal income taxes on any profits that the business earns. 

Stock: Stocks are a type of security that indicates an ownership interest in a company. They are used to help a company grow. Corporations issue stock to help a company grow and to fund all kinds of business purposes and operations.

T

Tax Shelter: Tax shelters are legal strategies that can decrease or defer your tax liability. They come in a variety of different forms and methods and can offer significant benefits if used properly.

U

Underwriter: Underwriters are a part of the business loan and business insurance process. They can help approve applications based on several factors.

V

Venture Capital: Venture Capital, by definition, is start-up money you receive from an investor in exchange for giving that investor a piece of your business.

W

Working Capital: Working capital equals your company’s assets minus your company’s liabilities.

Start an LLC

Ready to get started?

This is it.

Create Your LLC in Minutes