Section 83(b) of the Code (IRS Tax Code).  A founder/employee purchases company stock at the fair market value of the stock.  Because the purchase price equals the fair market value, there is no income and, therefore, no tax at the time of the purchase.

There is a tax consequence when the founder/employee sells that 83(b) Election company stock.  Depending on how long the stock was held, the gain may be taxed at the lower long-term capital gain rate.

Also see RSPA.

"A key component of vesting is defining what happens to vesting schedules upon a merger. “Single trigger” acceleration refers to automatic accelerated vesting upon a merger. “Double trigger” refers to two events needing to take place before accelerated vesting (e.g., a merger plus the act of being fired by the acquiring company.)

Double trigger is much more common than single trigger. Acceleration on change of control is often a contentious point of negotiation between founders and VCs, as the founders will want to “get all their stock in a transaction – hey, we earned it!” and VCs will want to minimize the impact of the outstanding equity on their share of the purchase price."

(Source: FeldThoughts - http://www.feld.com/wp/archives/2005/05/term-sheet-vesting.html)

An incubator assists a startup through its earliest stages. It may help the startup by providing physical premises, through helping to form relationships with investors or potential hires, or by providing research or other resources that will help launch the startup in the marketplace or by providing other assistance as needed. 

Market research is a business discipline that gathers and synthesizes consumer feedback providing actionable insights about consumers’ behaviors, attitudes and demographics. It helps capture consumer motivations, providing insights that can help guide product development, marketing and positioning. (Source: Robin Boyar, TrustedPeer Expert)

Market research at the startup stage also defines the size and characteristics a of a potential market from the producer's rather than the consumer's viewpoint. It defines both the size and scope of the marketplace and the competitive landscape.

Restricted stock allows the company to repurchase stock on a reverse vesting schedule.  (See also 83(b) Election)

The RSPA is included in Best Practice #5.

A company in its earliest phases of operation is described as a "startup." Most startups are funded through the founder's capital or through small investors, although some attract venture capital. Startups are not self-sustaining entities. They are businesses at the level of experimentation and discovery. 

A venture capitalist is an investor who supports startups or small firms that do not have public capital. Venture capitalists invest in these companies with the expectation of a return on their investment. Since such investors are gambling on startups, they tend to favor companies with a large, well-defined market, a solid, proven team and a clearly-differentiated product.