SAN FRANCISCO (AdAge.com) -- One of the biggest venture-capital firms of Silicon Valley today announced a $250 million fund created for social-media investments, called the sFund. The power quad of Facebook, Amazon, Zynga and Comcast partnered with Kleiner Perkins Caufield & Byers in order to provide "financing, counsel and relationship capital for a new generation of entrepreneurs to deliver on the promise of the social web," according to a press release. Also on board are Liberty Media and Allen & Company.
Interestingly enough, back in the paleolithic era of the web, KPCB funded Amazon, Sun Microsystems, Electronic Arts, Intuit, AOL, VeriSign and Google. So why now? "Social is just getting started and the opportunities are vast. As in the early days of the internet, the race is on," said fund leader Bing Gordon in the release. Mr. Gordon is a former top executive at Electronic Arts and current board director of Amazon and Zynga. "Today every business, organization and entrepreneur should have a social strategy," he said.
Out of the billions of dollars that companies spend on advertising, only a tiny fraction of it is spent online, and out of that, only another tiny fraction is spent on social media. "In five years, Facebook is the world's social dial-tone, Amazon is your shopping dial-tone, we will be your social games dial-tone," said Zynga founder Mark Pincus during the press conference, as tweeted by @danidudeck. At the conference were a power roomful -- in addition to Mr. Pincus and Mr. Gordon, in attendance were Amazon founder Jeff Bezos, venture capitalist John Doerr and Facebook founder Mark Zuckerberg.
According to a Facebook PR tweet, Mr. Gordon said of companies he wants to fund that "those who come with a shovel will do better than those who just slap it on." So it looks like Cafebots came with a shovel. The slealth startup secured $5 million from the sFund and hopes to help users with their "friend relationship management."