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 South Carolina, venture capital financing is not governed by a specific set of state statutes but is subject to general state laws that regulate securities, businesses, and contracts. Companies seeking venture capital in SC must comply with both state and federal securities laws, including regulations set forth by the U.S. Securities and Exchange Commission (SEC). These laws require proper registration of securities or adherence to exemption requirements when offering equity to investors. Venture capital firms in SC, like elsewhere, typically conduct thorough due diligence on potential investment opportunities, assessing factors such as the management team's strength, market size (TAM), product-market fit, and competitive landscape. The South Carolina Jobs-Economic Development Authority (JEDA) may also facilitate venture capital investments by issuing bonds to finance business and industrial expansions, which can include startups with high growth potential. It's important for startups to work with an attorney to ensure compliance with all relevant laws and to structure the venture capital transaction in a way that aligns with their business goals.