#3 Term sheets

With this particular task, you can get to know the intentions of the person putting in the money. Check out for exit clauses, if not clearly defined; ask for them to be clear and precise. Even though the term sheets aren’t definite or fixed, it helps to know what the person with the money is actually looking for.

Term sheets are created very carefully to fool even the best people to make them believe that they’ve a struck a great deal. But in the real context, it’s not always the case for an entrepreneur. Hence, at this stage it’s better to validate your term sheets by experienced entrepreneurs who have gone down the  road and/ or a lawyer who has relevant experience.

4. Set Expectations

Most of the deals are left to ambiguity, either due to the lack of clarity at the stage of getting into a deal or because of assumptions made by either party. It is crucial to set expectations from both ends and be clear about it. Entrepreneurs need to build trust with their VC’s and vice versa. If lack of trust exists at the beginning stage of the relationship, it is likely to affect the company as well as the relationship at the later stage.

Never take this relationship for granted because if you fail to maintain it, giving up would be the lonely  thing that you can do with your venture. Hence, be vigilant while entering into a contract.

Read more: 5 Entrepreneurial Lessons From Lord Shiva

Read more: 4 Bold Women Entrepreneurs Who Said "NO" To Campus Placements