Business & Finance Glossary: K
9 terms starting with K, from a glossary of 572 definitions covering intangible assets, valuations, and key financial concepts.
Key Performance Indicator (KPI)
A quantifiable metric used to evaluate the success of an organisation, team, or initiative against its strategic objectives. Effective KPIs for growth businesses span financial (ARR, gross margin), operational (productivity, churn), and intangible (brand awareness, employee engagement) dimensions.
Read more →Key Person Discount
A reduction to business value reflecting the risk that the departure of one or more critical individuals would materially impair the company's earnings, relationships, or operational capability. Key person discounts are most significant in professional services, early-stage ventures, and founder-led businesses where revenue concentration or specialised expertise is tied to specific individuals. The discount is typically quantified through scenario analysis estimating the probability and financial impact of the key person's departure.
Read more →Key Person Risk
The vulnerability a company faces when critical knowledge, relationships, or capabilities are concentrated in a small number of individuals. Key person risk is a major factor in intangible asset valuation and due diligence, particularly for professional services firms, early-stage companies, and fund management teams.
Read more →Know Your Customer (KYC)
The regulatory requirement for financial institutions and certain other businesses to verify the identity of their clients, assess their risk profile, and monitor transactions for suspicious activity. KYC procedures are mandated by anti-money laundering regulations including the EU's Anti-Money Laundering Directives and the UK's Money Laundering Regulations 2017, and form the first line of defence against financial crime.
Read more →Knowledge Capital
The accumulated stock of codified and tacit knowledge within an organisation, encompassing technical expertise, process documentation, proprietary methods, and institutional memory. Knowledge capital is a core intangible asset that directly influences innovation capacity, operational efficiency, and competitive advantage.
Read more →Knowledge Economy
An economic system in which growth and value creation are driven primarily by the production, distribution, and application of knowledge and information rather than physical goods. In the knowledge economy, intangible assets — including human capital, software, data, and intellectual property — constitute the majority of enterprise and national wealth.
Read more →Knowledge Spillovers
The unintended transfer of knowledge from one firm or sector to others, creating wider economic benefits that the original investor cannot fully capture. Knowledge spillovers are a defining characteristic of intangible investment and a key justification for public policy support of R&D, education, and innovation.
Read more →Knowledge-Intensive Business Services (KIBS)
Firms that provide specialist knowledge-based services such as consulting, engineering, IT services, legal advisory, and financial analysis. KIBS firms are characterised by high intangible asset intensity, with the majority of their enterprise value derived from human capital, client relationships, proprietary methodologies, and reputation.
Read more →Known and Knowable
The IPEV Section 2.5 evidence standard: information that is 'Known or Knowable as of the Measurement Date' is in scope at every quarterly Fair Value remark, whether the founder surfaced it or not. Known information is on the company's books, in board minutes, or in disclosed correspondence. Knowable information is what a competent valuer can reasonably find — patent registers, regulatory filings, trade press, sector benchmarks, ICAEW/SEC filings, customer references obtained through reasonable enquiry. The standard is asymmetric in the founder's disfavour: information that's knowable but unsurfaced is held against the company, not the analyst. Pre-emptive evidence-building flips the asymmetry — when a founder builds the 12-driver inventory before raise, the Valuer's 'knowable' search returns evidence the founder controls rather than evidence the founder forgot. The 2025 IPEV update sharpened this standard, making per-period reassessment of the known-and-knowable inventory a quarterly discipline rather than an annual exercise.
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