The Madison company, which is developing a process for making hydrogen and hydrocarbon fuel gas, said the financing was led by Venture Investors, a Madison-based manager of venture capital funds primarily serving Wisconsin and the Midwest.

In addition, Advantage Capital Partners, St. Louis, participated in the financing, the company said. Advantage Capital invests in companies that are involved in federal, state and local economic development programs.

Founded by two University of Wisconsin-Madison professors in June 2004, Virent Energy already has received about $4 million in grants from the National Institute of Standards and Technology and the Wisconsin Department of Energy.