Getting hold of some venture funding capital for your new entrepreneurship is one thing; actually putting it to use is another. You have to remember one thing when you are applying for any venture capital funding—you will need to fulfill the expectations of the person who is pinning his or her hopes in your business as a potential investment. If the venture capitalist has put in money, they will expect returns in the next few years. There have been cases in which entrepreneurs have made as many as 10 times the investment for their venture investors in the first 5 years of starting the business. This has actually raised the hopes of all investors quite high. If not this, they at least expect some returns to come. That, as the entrepreneur who is using their capital, becomes your responsibility.

Venture funding capitalists are actually very discerning about where they invest. When you submit your proposal, there are various things that actually happen before you get those funds. These people will scrutinize your application thoroughly. They will make sure it fits in with their bigger plan, i.e. getting returns on their investment. They will see if the business idea you have forwarded is something that the market will want. They will see whether you have it in you to realize that single germ of a business concept you have and convert it into a money-spinning business. In short, they are going to look into several things.

There will be discussions and deliberations among them. Rarely does it happen that you get your entire venture funding from a single investor. A group of them usually comes together and they enter into several discussions about whether they should consider your concept. Once that happens, they pool in their resources and generate the venture funds needed for your enterprise. This isn’t a simple process; there’s a lot that goes on behind the ranks. So, if you do get the venture capital funds, you have to realize that there’s a lot at stake.

But, think of it this way. The venture funds are something you can use to realize those dreams. If these hardcore businesspersons have deliberated so much and then decided to give you the funds, it means two things—(1) they liked your business idea very much and saw the potential in it and (2) they liked your entrepreneurship and saw the potential in you. Naturally, this means that you have it in you to make your business successful. You have to use these funds to implement your ideas now so that you can do what professional and experienced people (i.e. the venture investors) are already expecting of you.

In order to indicate to you how special you are if you get venture funding, here are some facts. Out of every 1,000 entrepreneurs who are applying for venture funding in the UK presently, only 1 person will actually get them. There are venture funding contests going on. About 200 to 300 different entrepreneurial ideas are bandied around during such contests. Out of these about half are just straightaway rejected, even without being properly read. A more elaborate scrutiny eliminates a further half of what’s remaining. This goes on till only a handful of the most meritorious entrepreneurial ideas remain. Then, these are run through by a specially organized committee who discuss and deliberate minutely about every aspect of the business plan and only after that is an entrepreneur selected for the venture funding.

Most of these contests will also entail proper physical interviews with the prospective entrepreneurs to see if they really have what it takes, or if they are only good on paper. During these interviews, they are asked to make presentations. These presentations are to be shown to teams of 10-12 venture capitalists at once, who will then follow up with a question-answer session, during which things can get very hot under the collar. However, you must know that most of the decisions are already made before the question-answer session. The interactive interview is actually a formality to see that everything is just as the venture capitalists have pictured about the entrepreneur and his or her proposed business idea.

Now, if you are going through all these processes and then getting accepted for venture funding, then it means that your business concept and even you as an entrepreneur have something that all those other people don’t have. Take this as your strength and use the funds you have received to the best advantage.

There are some practical things that you have to think of as well. When you are discussing your idea to all these venture capitalists, there is a fair degree of risk involved. It is possible that someone might like your idea so much that they may want to implement it themselves. Generally venture capitalists don’t do that, they have too much money to want to put in the effort of implementing an idea, but there’s always some apprehension involved in such cases. Hence, it is good to communicate with as few venture funding companies as you can, and try to give it your best shot. If you are called for the presentation, you must know that you are almost selected; it is only your presentation that has to impress those people right now. So, you have to do your best here.

Eventually, when your idea gets selected for the venture funding, you have to ensure that you put it into action right away. The venture capitalists will always be after you, monitoring and verifying your every step. They will want to make sure that their investment is secured and that you aren’t making mistakes. This is actually good—you benefit from their able support and experience—but you gave to remember that you are always under the scanner. They might even want to appoint someone on the board of directors or in some managerial capacity in your company so that they can keep a close watch on what’s happening.

So, venture funding is good, but you must know that there are several strings attached. If you want to make the most of it, you have to be ready to play by the rules.