The explosive growth of Facebook has triggered a new boom in early-stage Internet investment, with news on Thursday of a new, US$250M fund aimed at start-ups looking to profit from the social networking phenomenon.
Run by Kleiner Perkins Caufield & Byers, one of Silicon Valley’s best-known venture capital firms, the handful of investors in the fund includes a group of established internet companies, including Facebook, Amazon (NASDAQ:AMZN) and Zynga, a fast-growing company that makes games for users of Facebook.

The unusual decision to include as investors companies with a direct interest in different aspects of the Internet will have an impact on how the fund is invested.
Bing Gordon, the Kleiner partner who will oversee the fund, said the new investment vehicle will not invest in any new games companies to rival Zynga.

The company, which dominates the rankings of leading games played on Facebook, has already been backed separately by Kleiner.

The limitation could exclude the fund from one of the most active areas of social networking, given the soaring popularity of games that connect users with their friends. Mark Zuckerberg, chief executive of Facebook, said games had become the first popular applications to be developed for social networks, as they were on earlier new computing platforms, like the PC.

The new investment vehicle, called the sFund, echoes earlier Kleiner efforts to cash in on new computing platforms with the potential to attract millions of new users. These include its iFund, which has US$200M to invest in applications that run on Apples (NASDAQ:AAPL) Touch screen devices.—Paul A. Ebeling, Jnr. www.livetradingnews.com

Posted by Shayne Heffernan on Oct 22nd, 2010and filed underLatest News.You can follow any responses to this entry through theRSS 2.0You can leave a response by filling following comment form or trackback to this entry from your site