Posted by: Rob Hof on September 17, 2007
Speaking at TechCrunch40, Facebook CEO Mark Zuckerberg popped out a surprise announcement minutes ago: The company, with Facebook investors Jim Breyer of Accel Partners and Peter Thiel of the Founders Fund, has created a $10 million FB Fund, which will distribute grants of $25,000 to $250,000 to companies that want to create (or have created) “innovative and disruptive” applications on top of Facebook. (My initial headline implied that Facebook would fund it, but only Accel and Founders are supplying the money.) Since the announcement of Facebook’s applications platform in May, such applications have exploded, from slides shows to games, with some garnering hundreds of thousands of users. The fbFund will be run by Chamath Palihapitiya, Facebook’s VP of product marketing & operations. Thiel, Breyer, LinkedIn founder and Web investor Reid Hoffman, Stanford prof (and early Google mentor) Rajeev Motwani, and First Round Capital’s Josh Kopelman will be on the advisory board.
Interestingly, the company won’t take equity stakes in the companies, though Accel and Founders will have right of first refusal of future funding of startups that get grants. I wonder if that’s a dealbreaker for some companies with potential to play the VC field. But I still think this could give an even bigger boost to the Facebook ecosystem. Which doesn’t seem to need it, actually. But $10 million, and that could grow, will fund a heckuva lot of new ideas.