| Term | Definition |
|---|
| Sole proprietorship | Business with one owner; unlimited liability, pass-through taxation |
| General partnership | Multiple owners sharing unlimited liability and management responsibilities |
| Limited partnership | Partnership with at least one GP (unlimited liability) and LPs (limited liability) |
| Limited liability partnership (LLP) | Partnership where all partners have limited liability; no GP required |
| Corporation | Separate legal entity; limited liability for owners, managed by BOD |
| Pass-through entity | Business form where income is taxed only at the owner level |
| Double taxation | Corporate income taxed at entity level, then dividends taxed at personal level |
| Legal identity | Whether a business is a separate legal entity from its owners |
| Limited liability | Owner’s maximum loss is limited to the amount invested |
| Unlimited liability | Owner is personally responsible for all business debts |
| IPO | Initial Public Offering — first sale of shares to the public |
| Direct listing | Listing existing shares on exchange without underwriter or new capital |
| SPAC | Special Purpose Acquisition Company — shell company that acquires a private company |
| LBO | Leveraged Buyout — acquisition using significant debt |
| MBO | Management Buyout — management team acquires the company |
| Free float | Shares actively traded (not held by insiders, strategic investors) |
| Qualified investors | Accredited/sophisticated investors who can invest in private placements |