Betfair.com co-founder Josh Hannah joins Matrix Partners

Matrix Partners just added entrepreneur and investor Josh Hannah as a general partner based out of the venture firm’s Menlo Park, Calif. office. Hannah is probably best known for co-founding online gambling site Betfair.com (previously Flutter.com), which now says it manages more than $50 billion in transactions every year. He also purchased how-to site eHow in 2004, restructured it around user-generated content, increased traffic and revenue by 30 times, and sold the site to Demand Media.

Since the eHow acquisition in 2006, Hannah has been working as an angel investor and startup adviser — he has a seat on the boards of Friendster, Minted.com, uShip, and Betfair. Given all the doom-and-gloom about the economy and last year’s venture returns, this may seem like an odd time to be getting into the business. But it really isn’t, Hannah says, since he plans to stick around for a long time, and any early-stage investments made now won’t feel any pressure to get acquired or go public for years. The fact that the economic climate means startups are more inclined to give favorable terms to VCs is an obvious plus, too.

Speaking (very) broadly, Hannah says he will focus on “Internet, software, and other consumer technologies.” He says that given his previous experience, he’s particularly interested in user-generated content, online betting, and companies willing to take an innovative approach against established tech giants.

“To my view a lot of those big companies have become too focused on share price and underwater options,” he says. “There is a ton of innovation to be done without needing a big budget with some really great entrepreneurs to upset the order there.”

Like everyone else these days, Hannah says he’s looking for companies that have clear revenue models and that can still include online advertising, as long as it’s not “tacked on.”

Boston-based Matrix’s most successful invesments include Aruba Networks (which went public), JBoss (which was acquired by Red Hat), and SanDisk (which went public).

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