Glossary entry

First mover advantage refers to the strategic advantage that companies can gain if they are the first to launch a new product or innovation on the market. This advantage can take the form of brand awareness, customer loyalty, technological expertise or barriers to market entry for successors. However, success is not guaranteed - high development costs, technological uncertainties or early wrong decisions can quickly relativise the advantage.

Loss aversion describes the phenomenon that losses have a stronger emotional impact than equally high gains. This cognitive bias leads people to act in a risk-averse manner and avoid potentially favourable decisions just to prevent possible losses. Especially in investment decisions, loss aversion can lead to overly cautious behaviour or holding on to loss-making investments. Understanding this effect is crucial to making rational and successful long-term decisions.

Family offices help wealthy families with asset management and offer advisory services. They are also valuable investors for start-ups, as they invest for the long term and provide extensive networks and expertise.

The negative liquidation preference is an alternative investment model in start-up financing that represents a special arrangement in the event of liquidation. Here, investors do not receive preferential access to the assets, but the founders are paid out first.

The Net Promoter Score (NPS) is a key figure for measuring customer satisfaction and loyalty. It is based on the question of how likely it is that customers would recommend a company to others - on a scale of 0 to 10. Depending on the answer, respondents are categorised into promoters, passives and detractors. The NPS results from the proportion of promoters minus the proportion of detractors.

Business intelligence (BI) comprises methods, technologies and processes for collecting, analysing and presenting company data. The aim is to make well-founded decisions based on facts and trends. BI tools help to visualise large amounts of data, identify patterns and derive strategic recommendations for action.

A service level agreement (SLA) is a contractual agreement between the service provider and customer that defines specific services as well as their quality and availability. Typical contents include response times, key performance indicators (KPIs), responsibilities and measures in the event of non-compliance. SLAs create transparency, set clear expectations and serve as a basis for measuring service quality.

The sales funnel is a model that depicts the step-by-step journey of a potential customer from the first perception of a product or service to the conclusion of a purchase.