Venture Capital Financing is a form of equity financing (trade stock/ownership for cash) that is typically meant for high growth high return companies.  Venture Capitalists (VC) obtain their money (to invest in a company) from institutions like pension funds, universities, government programs (i.e. Utah Fund of Funds), wealthy individuals and corporations.  The investors in venture capitalists expect a high return on their money so venture capitalists are very careful in what companies they invest in.  For the most part venture capitalists invest in companies that have reached certain milestones, like customers buying the product or government regulator agencies (FDA) has signed off on some aspect or level of experimental data.  VC’s require healthy portions of ownership in a company in return for the investment dollars.  VC’s demand large ownership chucks (around 40-50%) because of economics not because of greed or ill will (at least let’s hope so).  An entrepreneur must understand that VC’s have individuals to answer to and prudent investing is required.  Although VC’s live and play in the high risk world, within that world there is higher risk and lower risk and VC’s must balance risk with potential return.