Glossary
Non-Dilutive Funding
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Glossary
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A 501(c)(3) is a U.S. tax-exempt non-profit; a fiscal sponsor is an existing 501(c)(3) that lets a project receive tax-deductible donations and grants under its umbrella before the project incorporates on its own.
A grant is non-repayable funding awarded by a government agency, foundation, or corporation in exchange for delivering on a specific scope of work. No equity given up, but heavy reporting and compliance attached.
An accelerator is a fixed-term, cohort-based program that invests a small amount in early-stage startups in exchange for equity, then runs intensive mentorship that ends with a demo day.
Burn rate is how much cash your company spends each month. Gross burn is total expenses; net burn subtracts revenue.
Non-dilutive funding is capital you receive without giving up equity in your company. The most common forms are grants (government and foundation), cloud credits, revenue-based financing, and competition prizes.
Every dollar of non-dilutive funding is a dollar you don't have to raise from equity investors, which means you keep that ownership stake yourself. For early-stage founders, $50K of grant money is roughly equivalent to not having to give up 1–5% of the company at typical pre-seed valuations.
Non-dilutive doesn't mean "free." Grants usually come with reporting requirements, restricted use of funds, and often a slower disbursement schedule. Build the application time and compliance burden into your decision.