thread-logoThread, a dating site that uses Facebook’s social graph to suggest potential matches, raised $1.2 million from Sequoia Capital, First Round Capital, Founders Fund and angel investor Ron Conway.

The site, founded by some of PayPal’s original product managers, helps people find dates through their Facebook friends.

“The best people to date are friends of friends,” said CEO Brian Phillips, who went on a third date with someone he met through the site. “Not all the best people are on dating sites. All the best people are on Facebook.”

When you join Thread, you log-in through Facebook Connect and it pulls the public profiles of you and all your friends. You can browse through them, find out who is single, and then send a personal message to your mutual friend asking them to introduce you. Or you can browse through friends to suggest others for people to date.

The company is focused on gaining traction at the moment, though there are advertising possibilities down the line to suggest restaurants or places to go on dates. They can also turn to a virtual goods model: if a friend wants to hype up another by saying he’s funny or charming they can buy a badge for his profile. ┬áThread is one of the 24 companies that are part of Facebook’s incubator program, fbFund Rev.

Thread was originally called Frintro (like “Friend” combined with “Intro) but decided to change its name in an arrangement that could set an unusual precedent for other start-ups. Thread.com was already taken, but they negotiated with the owner to lend it to them for two years. If they turn it in to a successful business, the original owner will take a share of the company. But if they don’t, the owner will get his address back.

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Thread in less than a minute from Thread.com on Vimeo.