Shark Tank Technical Word’s Meaning — EBITDA, ROAS, ARR, AOV, PAT, BURN, SEO

In Shark Tank Season 3, many technical and financial terms are being used. If you find yourself confused by these terms, here are the details of each word used in the Shark Tank India show.

EBITDA

Earnings Before Interest, Taxes, Depreciation, and Amortization. This metric shows a company’s profitability before accounting for financing decisions, taxes, and non-cash expenses like depreciation. It helps to compare companies across different industries and financing structures.

ROAS

Return On Ad Spend. This metric measures the amount of revenue generated for each rupee spent on advertising. It helps companies understand the effectiveness of their marketing campaigns and allocate resources efficiently.

ARR

Annual Recurring Revenue. This metric represents the predictable and recurring revenue a company can expect to receive in a year from its existing customer base. It’s important for subscription-based businesses and helps investors understand the sustainability of the revenue stream.

AOV

Average Order Value. This metric represents the average amount a customer spends on a single order. It’s important for e-commerce businesses and helps understand customer behavior and pricing strategies.

PAT

Profit After Tax. This metric shows the company’s net profit after accounting for all expenses and taxes. It’s the bottom line of the income statement and represents the actual profit available to the owners.

BURN

The rate at which a startup is spending its cash reserves. Startups often prioritize growth over immediate profitability, leading to negative cash flow. The burn rate indicates how long the company can sustain its operations before needing additional funding. (in short you can say it: Loss)

SEO

Search Engine Optimization. This refers to the techniques used to improve a website’s ranking in search engine results pages (SERPs). Higher rankings lead to more organic website traffic and potential customers.

Shark Tank Technical Word's Meaning — EBITDA, ROAS, ARR, AOV, PAT, BURN, SEO

Understanding these terms is crucial for evaluating businesses on Shark Tank, as they provide insights into the company’s financial health, growth potential, and marketing strategies. Remember, the context in which these terms are used also matters, so pay attention to how the entrepreneurs explain their metrics and what they mean for their specific business.

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[MBA in Finance]

Nazim Khan is an expert in Microsoft Excel. He teaches people how to use it better. He has been doing this for more than ten years. He is running this website (TechGuruPlus.com) and a YouTube channel called "Business Excel" since 2016. He shares useful tips from his own experiences to help others improve their Excel skills and careers.

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