Traunch

AAA

DEFINITION of 'Traunch'

One of a series of fund allotments earmarked for a specific purpose, such as a financing round in a start-up. Traunches are used by venture capital firms as a means of minimizing risk. Some experts believe "traunch" is a misspelling of "tranche", which means a slice or portion, and is used to describe instruments such as mortgage-backed securities that can be sliced into smaller pieces for sale to investors.

INVESTOPEDIA EXPLAINS 'Traunch'

For example, a development-stage company that has sought venture capital funding may initially receive a $2 million traunch out of a $5 million financing round, with the balance to be received after a month.

RELATED TERMS
  1. Venture Capital

    Money provided by investors to startup firms and small businesses ...
  2. Angel Investor

    An investor who provides financial backing for small startups ...
  3. Down Round

    A round of financing where investors purchase stock from a company ...
  4. Vulture Capitalist

    1. A slang word for a venture capitalist who deprives an inventor ...
  5. Seed Capital

    The initial capital used to start a business. Seed capital often ...
  6. Series A Financing

    The first round of financing undergone for a new business venture ...
Related Articles
  1. Entrepreneurship

    How Venture Capitalists Make Investment Choices

    In order to increase your odds for receiving funding, here are some criteria considered by venture capitalists.
  2. Fundamental Analysis

    Cashing In On The Venture Capital Cycle

    Find out how VC firms make the market go round, and round and round.
  3. Options & Futures

    When Your Business Needs Money: Angel Investors

    If you have a promising business that needs a boost, you may be able to put your faith in these wealthy investors.
  4. Entrepreneurship

    Top 9 Venture Capital Interview Questions

    Ace your interview by learning how to break down the most common questions asked.
  5. Personal Finance

    Seek An Adventure In Venture Capital

    Make a career out of chasing down the "next big thing".
  6. Professionals

    Understanding Interpersonal Skills

    Interpersonal skills are the social skills people use to interact effectively with other people. A lack of good interpersonal skills may lead to unsuccessful personal relationships, as well as ...
  7. Investing News

    The 5 Wealthiest People in Mexico

    Most people in the know have heard of Carlos Slim and his massive fortune. But what about Mexico's other richest people?
  8. Entrepreneurship

    The Most Successful App Companies

    The rapidly expanding mobile-app industry is worth billions of dollars. Its growth has led to huge success for some firms and very little for many more.
  9. Investing Basics

    Undervalued Franchises: The Best Choice?

    Searching for an undervalued franchise? Here's a quick guide to what's hot and what's a good bet.
  10. Entrepreneurship

    How do people make money on the videos they upload to YouTube?

    Learn about the primary ways that people can generate income based on the videos they upload to YouTube, including advertising and product placement.

You May Also Like

Hot Definitions
  1. Commercial Paper

    An unsecured, short-term debt instrument issued by a corporation, typically for the financing of accounts receivable, inventories ...
  2. Federal Funds Rate

    The interest rate at which a depository institution lends funds maintained at the Federal Reserve to another depository institution ...
  3. Fixed Asset

    A long-term tangible piece of property that a firm owns and uses in the production of its income and is not expected to be ...
  4. Break-Even Analysis

    An analysis to determine the point at which revenue received equals the costs associated with receiving the revenue. Break-even ...
  5. Key Performance Indicators - KPI

    A set of quantifiable measures that a company or industry uses to gauge or compare performance in terms of meeting their ...
  6. Bank Guarantee

    A guarantee from a lending institution ensuring that the liabilities of a debtor will be met. In other words, if the debtor ...
Trading Center