Venture firm throws money at Facebook leeches
Silicon Valley venture capital firm Bay Partners said it wants to write checks of between $25,000 and $250,000 to developers writing applications for Facebook’s platform.
This is like candy to some developers, who will enjoy nothing more than getting paid to write an application for the popular social network — where million users are selecting new applications ranging from photo-editors from photo-editor to music players at a rapid rate.
The project is remarkable because it suggests the firm believes these applications may grow into major companies simply by gorging on the massive 29 million userbase of Facebook as a testing ground. Bay’s program, called AppFactory, will invest in “tens” of companies using a fast-track approval process very similar to Charles River Venture’s Quickstart program. The program also write quick, early checks of up to $250,000, on the understanding the entrepreneur would come back to seek more funding if their project begins to look promising. Increasingly, venture firms are doing this to get early ownership of companies. CRV’s program focuses solely on convertibles — which are loans to companies that transform into equity holdings when the company goes on to raise a new round of capital. Bay Partners said it is flexible, offering convertibles and straight equity investments.
Bay said it is collaborating with Ajaxian.com, which has an active community of Ajax developers, as part of its effort to create an ecosystem that helps developers get started more quickly.
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About the Author, Matt Marshall
Matt launched VentureBeat in September of 2006, with the realization that no one else was covering the entrepreneurial and tech innovation scene with the velocity or depth that he was. Prior to founding VentureBeat, he covered venture capital for the San Jose Mercury News from 2001 to 2006. In 2002, Matt was awarded "Journalist of the Year" by the Northern California Society of Professional Journalists. Prior to working at the Merc, he was a correspondent for the Wall Street Journal in Bonn, Germany from 1995 to 1998, and a writer for the Washington Post in 1994. Matt holds a PhD in Government and an MA in German and European Studies from Georgetown University. In addition to VentureBeat, Matt is also the Executive Producer of DEMO, the leading launchpad event for emerging technologies.
