Venture capital financing (also known as venture capital funding or VC funding) is a form of financing for new or early-stage companies with high growth potential. Venture capital financing is offered by venture capital firms, which are professional investment firms that receive investment money from state pension funds, university endowment funds, and wealthy individuals. Venture capital firms seek multiple returns on their initial investment in a startup company. When evaluating companies to invest in, venture capital firms consider many factors, including (1) the strength of the management team; (2) the size of the market the company is in (total addressable market or TAM); (3) whether the company has proven there is demand in the market for its product or service (product-market fit); and (4) how easy or difficult it will be for other companies to compete with the company seeking venture capital financing.

In Kansas, venture capital financing is not governed by a specific set of state statutes but is subject to general state laws that regulate securities, business entities, and contractual agreements. Kansas follows both state regulations and federal laws, such as the Securities Act of 1933 and the Securities Exchange Act of 1934, which require companies to register their securities or find an exemption before offering or selling them. The Kansas Securities Act also plays a role in regulating the offer and sale of securities within the state. Venture capital firms must comply with these regulations when investing in Kansas-based companies. Additionally, the Kansas Office of the Securities Commissioner provides oversight and enforces securities laws to protect investors. When venture capital firms evaluate potential investments in Kansas, they must also consider the legal framework surrounding intellectual property, non-compete agreements, and other relevant state laws that could impact the growth and competitive edge of the startup companies they are considering for investment.