As an entrepreneur, you always have to be on the lookout for new opportunities. It could be a new business idea or talking to investors, which entails meeting and/or networking with venture capitalists or angel investors. VCs are everywhere: at conferences, networking events, trade shows, even church!  For other entrepreneurs that are trying to raise capital and want to learn how to nurture a venture capital relationship, the following is a bit of advice from past experience.

Define and communicate clear metrics.

 Being able to define and communicate clear metrics is the first step for nurturing an investor relationship. You need to know how much money you need and when you're going to need it.

You also need to be able to measure whether or not your company is meeting its goals, so that investors know if they should keep investing in you.

If your goals are not being met, this is a sign that something needs to change. If they are being met, then the next steps are clear: raise more money or sell more products.

The best way to do this is by setting up a dashboard that tracks all of your key metrics throughout each month; investors love seeing this data before they invest in you because it gives them confidence that their investment will pay off in the long run.

 Choose a time to talk regularly.

 Developing a relationship with a venture capital firm is similar to any professional relationship. You need to put in the work to build trust and credibility, make yourself available when they need you, and demonstrate that you are responsive and proactive.

Choose a time to talk regularly. Whether it’s weekly or monthly, set up regular calls or meetings with your venture partner at least every four months. These conversations will help you keep each other updated on what’s going on at your company and how it relates to their portfolio companies. They’re also a great opportunity for you to share highlights from your last few months, including any new hires or partnerships that could be relevant for them.

Make yourself available when they need you. If there is an event like Demo Day or another milestone coming up that would benefit from having the VC present (or if they really want to be there), make sure that they have all the information they need in advance so they can plan accordingly.

Give open and honest updates on what's working and what's not.

 It's easy to get caught up in the excitement of a new relationship. It's also tempting to spend all your time talking about your business, so you can't help but wonder: "How do I nurture this relationship?"

The answer is simple: You nurture a venture capital relationship by giving open and honest updates on what's working and what's not.

When you're in the process of raising money, it's easy to lose sight of how much work actually goes into building a company. Your board members are busy people who have many other things on their plates. You need to make sure they know how things are going with your business so they don't have to ask every week. That way, if there are any problems or concerns, they'll catch it sooner rather than later.

Keep your conversations very open-ended and non-specific until you meet again in person. If something important comes up during an email conversation that needs more discussion, schedule a phone call or meet them for coffee later in the week or month when you can talk more at length about it.

 Be proactive in seeking your investor's advice, but don't take it personally if they say no.

 The best investors will not only give you feedback and advice, but they will also help you anticipate challenges that may come up in the future.

To build a relationship with your VC, be proactive in seeking their advice. Don't wait for them to ask you what you think about something; if there's something that's bothering you, bring it up first. If there's a problem with your team or a deal that's not working out, let them know right away so they can help address it.

Be honest about what's going on in your company. Don't just ask for advice when things are going well — share negative news as well. Good investors understand that startups have ups and downs, making it important for them to hear about both sides of the story from time to time.

If your investor offers up helpful advice or feedback, don't take it personally if they say no or don't agree with you 100 percent of the time. A good investor wants to do what's best for your business — even if that means disagreeing with you sometimes!

Don't wait too long to ask for more money if you need it.

 Venture capitalists are not banks. They're not in the business of lending money to startups. They invest in startups with the expectation that they'll make money when a company goes public or gets bought by another company.

That means VCs will be happy to see you again when it's time for your next round of funding, but they won't wait around until that time comes if they have other options. They're looking for companies that will return their investment many times over, and if your company isn't on track to do that, they'll move on to one that is.

Don't wait too long to ask for more money if you need it. If you've raised enough money from investors and don't need more capital now, great! But if you do need more funding and haven't asked yet, there's a good chance investors are expecting you to ask soon — whether or not they would actually invest more money right now. So don't wait until you need another round of funding before asking around; start making introductions and setting up meetings as early as possible so investors can get to know your team and product before they decide if they want in on the next round of financing.

Maintain a good relationship even after you've taken your company public or sold it.

 After you've closed your first round of funding, the work begins. You need to build a relationship with your investors to keep them engaged and excited about your company's future.

It can be easy to think that once you've closed your funding round, the job is done and you can relax. But venture capital is an ongoing relationship. Your investors are looking for opportunities to help your business grow — and they expect you to keep them in the loop.

Keep them updated on company news. Investors want to know what's going on at the company they invested in. They're more likely to get involved when they feel like they're part of the team and have access to information before it reaches the public domain. If there's an upcoming event or announcement related to your business, let them know about it first so they can plan accordingly.

If you nurture the relationship with your venture capital partner, your business will prosper.

Ultimately, remember that your venture capital investor is a partner. You need to nurture your relationship with them just as you would any other business relationship. Doing so will ensure that the investment they have placed in you was worth their time and money.

The life sciences industry has been operating under a tough market environment for the last couple of years. The cost of launching new drugs has risen dramatically, and an increasing number of companies are restructuring their operations to cut costs and try to stay afloat.

Get Razor-Focused On Your Target

When it comes to the biotech industry, keeping in mind your company's specific target and focus is a big factor in being able to successfully make it through tough markets. The biotech sector has been a particularly hard-hit one of late; as many are aware, there's a lot of volatility in that industry, with market cap swings well above the market average. But we have found that even in those volatile times, there's a sweet spot for companies who have a clear idea of their target and know how to get there.

A company can make their target more specific by using a combination of geography and disease state. For instance, if your company focuses on endocrinology, you could choose to specialize in diabetes in the United States instead of endocrinology across the globe. This isn't to say that your company should only be limited to one country or disease state; you can still expand globally while remaining focused on one particular area. The important thing is keeping your options open while maintaining your core competencies throughout the process. This is especially true when things get difficult.

Partner Early And Often

 When a company is facing a financial crisis, it’s important to partner early and often with your legal counsel.

The first step is to make sure that the company has a plan in place to get through the downturn. This may include cutting costs, laying off employees and other short-term measures.

Once you have that plan in place, it’s time to start thinking about how you can protect your assets and employees from lawsuits during this difficult period. The best way to do this is by restructuring your company’s employment agreements early on and getting them approved before your financial problems become too severe.

If you wait until the last minute, then restructuring employment contracts will be much more difficult because there will be fewer options available for reducing compensation or benefits than if you had done it early on when times were better.

Have An Exit Strategy

It is important to think about how the company will be sold or taken public. This is especially critical in biotech, where the end-game is typically an exit either through a sale or an IPO. To maximize value, a company must position itself so that it can be attractive to potential acquirers.

A company's value is directly related to its ability to meet the criteria of potential buyers (and investors). This can be done by defining a clear and compelling business narrative that aligns with the goals of the buyer and investor. If you are looking for an acquirer that wants to add your technology to their product line, make sure your story fits into theirs. If you are looking for a strategic partner with a specific need, make sure your story meets their needs. In addition, if you are preparing for an IPO, you should be prepared to answer questions about how you compare with other companies and why an investor should buy your stock rather than another stock.

Positioning is critical because it sets the stage for everything that follows in the process and determines what value might be achieved under different scenarios (i.e., stand-alone vs. sale vs. strategic partnership). The positioning strategy must include specific milestones along with clear goals and action plans that can be used throughout its duration.

Put A Timetable In Place To Meet Goals

Another way to cope with tough markets is to set a timetable in place. A timetable gives a company the ability to measure their progress and determine if they are on track to make their expected goals. It also gives them a chance to decide whether changes need to be made for them to meet those goals. In order for the timetable to be effective, it should include details about what needs to be done and how long it should take. For example, if a biotech firm wants to launch a new product in three months, they would need to have all of the materials ready by a certain date and then have everything shipped by another date. They might also want to have some kind of marketing strategy in place so that they can promote their new product once it's released. This could involve anything from social media campaigns or advertisements on television or radio stations. If you're going through a restructuring process at your company then this type of planning is critical because there will be many people involved who are trying their best but may not always agree with each other's ideas or methods for achieving success.

Use A Scenario-Based Planning Process

Scenario-based planning is a logical and methodical approach to planning for the future. It helps companies think through their options, make sound decisions and align resources around their key strategic priorities.

The basic premise is that life does not proceed in a straight line. In fact, it is full of surprises and unexpected events that can throw even the best-laid plans off track. Sometimes these surprises are good—the markets for your products take off faster than expected or you receive a valuable new patent. Other times these surprises can be bad—your lead drug candidate fails in clinical trials or a competitor launches a competing drug that steals market share from your own products.

To understand how scenario-based planning works, let’s consider an example of how this process could apply to biotech companies with strategic plans based on four key priorities: (1) commercializing drugs currently in development, (2) bringing new drugs into development, (3) optimizing costs through restructuring and (4) expanding operations overseas. The company has already created a business plan that outlines the details of each priority, including key milestones and resources required to achieve them. The company may even have picked out an “optimistic” scenario that assumes all goes according to plan and its revenue projections align with timetables.

In the end, companies have to balance the need to cut costs, reduce exposure to risky assets, and provide higher returns for shareholders in tough economic environments. That can involve everything from job cuts to asset sales. And while biotech companies may be more vulnerable to these kinds of changes, they are also better positioned to weather market storms than some other industries. With large upfront investments and lengthy approval processes needed to launch new products in the healthcare space, a company's strongest asset can also be one of its most valuable liabilities—and identifying how these strengths and weaknesses fit into each company's overall strategy is vital when evaluating whether or not it makes sense long-term.

There is a reason why investors invest; they want to see a good return on investment. A good investor plays an incredibly critical role in the recruiting process. If you are the type of person who likes to know who you are working with, and what your financials are before you dive in — then having an investor on your side can be a great addition to your startup. Many companies can run into pitfalls when they accept capital from investors that they did not choose themselves because they failed to negotiate certain protections and clauses within the investment contract.

For early stage startups, you need employees to choose the company. Not the other way around

The startup hiring process is like a first date. You want to put your best foot forward and impress, but if you are too smitten you may not see the red flags.

If you continue down this path, it can be disastrous for your company. In a recent survey of small business owners, 30% of respondents cited hiring the wrong person as the single biggest mistake they have made.

For early stage startups it is doubly critical that you get your hiring right. It is hard to overstate how important the first employees are to a young company. The product and brand are in a state of flux; teams are lean; and there is no playbook for most of what you'll do. You need employees who choose to be part of something special, even when things get tough — not just because they got an offer letter and want a job.

To find these people, investors will sometimes tell founders they should not hire someone they are considering. This can be frustrating when you're 10 resumes deep in the candidate funnel: why would someone on the outside suggest that after all this work? But it's worth pausing to consider the reasoning behind this advice from a different angle:

A good investor can help you close candidates; a great investor will sometimes tell you they see a red flag in your perfect candidate.

The Ideal Candidate

If you’re a seed-stage startup, you need to be a great recruiter. No matter what your product is, the first thing a candidate will do is look at your team. In fact, a good candidate will be talking to multiple startups simultaneously, and your team will be one of the two or three most important factors in their decision.

The first few people you hire are likely to set the bar for everyone else. If you’re lucky enough to have a candidate who is an incredible fit and ready to come on board, even if they don’t have years of experience with the technology or business model you’re working with, you should hire them. Their enthusiasm and personality will infect other employees and help them grow into their roles. They’ll also be able to recruit others by simply being excited about the opportunity to help build something new.

Before bringing anyone on board, it’s important that both parties are clear about what they’re getting into — if they aren’t, they won’t last long. Begin every candidate discussion with one commitment:

First, tell them that while obviously you are incredibly enthusiastic about this startup, that you believe people choose companies, not the other way around.

Proposing the Candidate to the Investor

There's an old saying in Silicon Valley: "Decent investors will help you close candidates. Insightful investors will tell you who not to hire." If a potential investor has invested in or worked at a company where your candidate was previously employed, it's likely they'll have some insight into that person's character and performance.

It's common to ask for references from your potential candidate's previous employers, but what about calling their previous investors? How much value can an investor provide on a reference check?

An investor can give you an honest assessment of the candidate because they have no stake in the outcome of your hiring decision. In most cases, they don't work with the candidate anymore and they aren't interested in providing a reference. However, if you explain your situation clearly and present them with specific questions relating to the candidate's strengths and weaknesses and their cultural fit, they might be open to sharing their thoughts with you.

The key is to be prepared before reaching out to an investor. Provide a bit of your background with the company and the investors to level-set any hesitation from the candidate.

It's clear to see that investors bring value to the recruiting process, and they should be taken seriously. Investors can help you identify talented candidates, give you test insights, or even save you time in your hiring process. That being said, it's also clear that not all investors are created equal. Asking a few pointed questions when dealing with these individuals can help you separate the wheat from the chaff.

Deciding if a career in venture capital is right for you can be a difficult decision. Venture capital is arguably one of the ideal career paths for young, ambitious professionals with a passion for entrepreneurship. The industry attracts top talent from both economics and business schools who are trying to change the world. It offers competitive salaries, stock options, and the potential to work with America's hottest startups. Venture capital may be able to fill your need to stay connected with entrepreneurial ventures (although, as you'll see below, it isn't the only option). But before you jump headfirst into the exciting world of start-ups and venture capital firms, make sure that this career path is right for you.

Venture capital has come a long way over the past decade

Venture capital has come a long way over the past decade. While it's still seen by some as a risky business, the experiences of the investors themselves have improved dramatically. They're getting more and more sophisticated as they learn how to evaluate companies, how to evaluate their own work, and how to make money in the venture world. The success stories like LinkedIn, Twitter, and Zynga have led others to believe that VCs can be an incredibly lucrative career path. But there are still a lot of naysayers out there who think that VC is a bubble about to burst—and it's even been blamed for the current state of unemployment in Silicon Valley. In reality, though, it's not a terribly risky job at all. Venture investing is a very high-risk job—if you don't pick good investments you're not going to do well—but the rewards from some of these investments are astronomical. This means that people who get into venture capital as early as possible have an opportunity to turn around millions of dollars in their careers.

The landscape of venture capital has changed

The landscape of venture capital has changed dramatically. Venture capital has always been a relatively tiny industry within the world of finance and business, but even though it's still small, it's grown considerably from less than $1 billion in investments in 1965 to over $100 billion today.

Along with an increase in the amount of funding, there's been a change in the type and breadth of companies receiving capital. The classic venture capital model was to invest in early-stage technology companies that were thought to have huge potential for growth. However, as the number of startups and successful exits have exploded, so have the kinds of companies that now receive VC funding—retail, biotechnology, restaurants, transportation, healthcare—you name it. This is partly because there are simply more companies (and entrepreneurs) out there than ever before—in large part due to the increase in technology that's made it easier to start a company—and also because VCs have realized they can make money not only from huge exits, but also from smaller exits at reasonable multiples.

There is no one-size-fits-all formula for success in venture capital

In general, VC is suited for people who thrive on the challenge of finding and supporting great entrepreneurs, have the ability to work in a fast-paced environment, and can easily adapt to change. It's also helpful to have a strong passion for technology, business and/or finance. However, there is no one-size-fits-all formula for success in venture capital.

If you're contemplating a career in venture capital but aren't sure if it would be a good fit, consider these questions:

Do you enjoy working with entrepreneurs? Are you comfortable being the "bad guy" when necessary?

Venture capitalists spend a lot of time working with entrepreneurs at the earliest stages of them building their companies. The relationship between an entrepreneur and his or her investors is one of the most important ones they'll have as they start their businesses. It's critical that they feel like they're on the same team with their VCs and trust them implicitly. If you want to be a VC but don't enjoy interacting with people or are uncomfortable being assertive when necessary, it probably isn't right for you.

Are you highly analytical? Do you enjoy learning about new industries?

VCs need to be able to quickly grasp unfamiliar topics and understand complex business models.

The answer to "is a career in venture capital right for you" will depend heavily on your interests, skills, and talents. You might want to do something completely different if you were to enter the venture capital world. Some people might get the wrong idea thinking that being a VC means you're getting rich quick by investing in new companies but it's not always like that. It's very hard work, responsibility is great and the pressure just to make a portfolio of investments successful can be burdensome on some. This is also why most people think that VC firms don't take much risk or chances since they mostly take part in follow-on rounds or seed rounds instead of making an investment during an initial round. It's a misconception that there are no risks involved but this is actually true when it comes to bets made by investors - if they back the right players however then risks are manageable.

The annual contracts that software companies offer are pretty great. You'll get an intuitive application at a discounted price and pay for any additional services on an as-needed basis. The best part is you know exactly how much you're going to spend that year. Part of the reason why this is so attractive to business owners is because it's predictable. Predictable costs give you more control over your budget, allowing you the freedom to focus on growing your revenue. But, it's time to reconsider your annual plan.

Monthly contracts win on long-term retention

The verdict on monthly vs. annual contracts is in — and the winner is monthly. According to our recent retention study, annual contracts lose 21% of customers after their first year, while monthly contracts lose only 10%.

That's a big difference.

What's more, this data comes from a large pool of online retailers who use ReCharge to power their subscription businesses. So it's real-world data that applies to you and your business.

Why do annual contracts have such a high attrition rate? One reason may be that people are more likely to subscribe to something they're not 100% confident about for a shorter period of time. However, there also seems to be a growing trend towards shorter-term commitments across the entire economy. For example, gyms are now offering one-month memberships rather than annual ones.

So should I kill my annual contract plan?

The answer depends on your needs and your business situation.

If you have an annual contract, don't automatically cancel it. See if you can negotiate with your provider to get a better rate. If you're happy with the services you receive and find that you're using everything in the plan, it makes sense to keep it.

But if you feel like you're paying for things you don't need — or if your business has changed since you signed up for the plan — it's time to consider switching to monthly contracts (if possible). Here are some things to consider before canceling your annual contract.

If you have a high-usage plan, but don't use all of the minutes, data or text messages included in your package, then an annual plan may be better than a monthly contract. But if you need to upgrade during the year, then an annual contract means paying extra fees. This could cost more than switching to a monthly contract when you need more data or minutes.

If your company is growing quickly and adding new employees every month or quarter, then a monthly contract makes sense because everyone can get the plan they need as soon as they start working with the company.

Don't undervalue your product or service

As a business owner, you're well aware of the data that shows that more than 60 percent of customers leave after the first year.

If you're offering annual instead of monthly contracts, you may be losing business for no good reason.

A focus on customer loyalty is important, but don't undervalue your product or service. If your monthly pricing is higher than the monthly equivalent for an annual contract, that's fine — customers get a break if they commit to longer terms. But if your monthly option is less expensive than an annual contract, it might be time to raise your prices.

It's not just about making more money either; it's about sending the right message to your customers: You offer a great product, and it deserves its full price tag. 

As you can see, it's often valuable—if not essential—to consider an annual contract if you want to take your business or career to the next level. It might not be right for everyone, but many businesses and professionals live in a world of ever-expanding growth and expansion. With the right account manager and all the tools available through annual contracts, you'll be able to make those goals into realities. Give it some thought, especially if you've gotten a bit mired down in the same routine and feel that something is missing from your life or business. As more and more people realize how much value these annual plans offer, there's every reason to think that more and more businesses will want to take advantage of them sooner rather than later.

There are many reasons why you should have a business plan ready. In the long run, you'll reach your company's goals, avoid making the same mistakes your competitors made, and launch new products on time. As a start-up company without much experience and limited resources, having a business plan written can be difficult, but if done correctly it can make or break your business.

Executive Summary

The executive summary comes first in the business plan, but it should be the last thing you write. This is because it has to be very clear and concise, summarizing all of the key points of your business plan in less than two pages. It's your opportunity to summarize three or four key points about your company - including its mission statement, its goals for growth and what makes it different from competitors - before diving into details. Your executive summary should be no more than two pages long, with brief summaries of other sections of the plan.

It’s essential if you’re seeking a loan or investment

The purpose of a business plan is to give any potential investors or lenders an idea of how you plan to run your business. If your business is just starting out, it’s important to not only have a plan in place but to make sure you revisit it and update it on a regular basis so that you can stay on track and adjust as needed.

It’s essential if you’re seeking a loan or investment. Investors who are considering putting money into your company will want to see that you’ve put time and effort into creating a thorough plan.

It helps you find holes in your plan before they happen. It may be difficult to think about your business failing, but planning ahead and mapping out what could happen can help save your business if things do go awry.

It outlines goals and details how you plan to achieve them. Having a step-by-step guide can keep everyone on the same page and working toward the same goal.

It helps you understand costs and where money needs to be allocated. Starting and running a small business requires a lot of money, so it’s important to know up front where all of your funds will come from, how much you need for start-up expenses and how much of that you can use for personal survival.

Market Analysis

Market Analysis is one of the most important elements of a business plan. The plan needs to identify the target market segments and then provide some data to indicate how fast each segment is growing. The size of the target market should be described in terms of number of clients, revenues or geographic area. There should be enough information included about the target market to demonstrate that there is an opportunity for the product or service being proposed.

In addition to addressing the target market and its growth, the Market Analysis section should describe any trends within the industry that will affect potential sales of the business being proposed. For example, if a new technology is expected to make a product obsolescent, this should be identified in this section so that it can be addressed later in the marketing strategy section.

Sales & Marketing Plan

Sales and marketing is the method of generating interest in a product or service, with the goal of getting a customer to buy that product or service. Sales and marketing entails everything from online advertising to cold calls to developing a customer referral program. It also includes tracking customer information, such as their buying habits and preferences, using customer relationship management (CRM) software.

Marketing plans are developed by all types of businesses, large and small, for-profit and not-for-profit enterprises. Marketing plans are used to describe how an organization can implement its marketing strategies.

Create a marketing plan that details your sales strategy for your business. Depending on the type of business you have, this will be different for every business owner. For example, if you have a restaurant business, you will want to include information about your menu items, pricing, location and target market in your plan. You should also consider your competition and how you will differentiate yourself. If you have an internet business selling products or services, include information about how you will market your website and drive traffic to it in your plan.

Financials

The financials section of your business plan should include a sales forecast, expenses budget, cash flow statement, balance sheet and a profit and loss statement. This is an interesting part of the business planning process because you really need to know your numbers. Don't worry if you don't have all your costs down yet. Some things will be hard to estimate until you get started, but it's important to put down some numbers even if they are just estimates.

It is better to overestimate than underestimate because overestimating will cause you to save money or raise more capital before starting up in case you underestimate your expenses. This is money you will need for unexpected problems that arise during construction or opening and for working capital in the early months before revenue starts coming in. It can take several months or even years for a new business to become profitable.

In the end, a business plan can provide a solid foundation for your business, and will help keep you focused on these key areas to ensure that the business is profitable. Business owners must know how to run their company in order to ensure its success. Having an outline of possible scenarios that could happen and how to handle them ahead of time are going to allow small businesses to thrive. Having this information and being prepared will allow companies to succeed much faster than a company without one.