Z-Tranche
A Z-tranche is the lowest ranked portion of a split-investment that is paid off only when all the other senior tranches (aka installments) have been satisfied. A z-tranche comes with pre negotiated payment terms and enables investors to get equity in a company at the lower pre-money valuation when they made their initial investment. It also enables investors to gain more equity in the business because their staggered tranches are not self-diluting.