Facebook, Accel and Founders Fund Launch fbFund; To Give Grants To Facebook App Startups

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1. Allen Stern
   

   September 17th, 2007 at 5:50 pm

   here are my notes:
   http://www.centernetworks.com/.....ok-keynote

   must be nice for tc to get to pre-prep all posts

2. Product Manager
   

   September 17th, 2007 at 5:52 pm

   What, another Facebook fund. Are we having F-bubble right now?
   This is interesting development….

3. D. Narendra
   

   September 17th, 2007 at 6:04 pm

   He stole my idea again. Got to talk to my lawyer about this….

4. Robert Scoble
   

   September 17th, 2007 at 6:08 pm

   Here’s the official news from Facebook:

   What is fbFund?
   fbFund is a fund focused on continuing to create incentives for the development of applications on Facebook Platform by accepting applications for $25,000-$250,000 non-recourse grants from anyone interested in building their business on Facebook Platform. The grants will not come with any conditions except that the grantee use the funds to build their company on Facebook Platform.

   What is the total investment in the fund?
   Initially, the fund will make available $10 million in capital. This may grow over time.

   Who is eligible?
   Any individual or company, anywhere in the world can apply as long as they have not raised any formal venture funding.

   What companies are involved?
   fbFund will be administered by Facebook and funded by Accel Partners and The Founders Fund.

   Will there be any equity granted in exchange for the investment?
   No, The Founders Fund and Accel Partners will have the right to fund these companies first, but beyond this, no equity or debt will be associated with any grant made.

   Who is participating in fbFund?
   The investment committee will be comprised of Mark Zuckerberg, Facebook founder and CEO, and Chamath Palihapitiya, Facebook vice president of product marketing and operations. Facebook board members Jim Breyer (Accel Partners) and Peter Thiel (The Founders Fund) will also be part of the committee. Additionally, the fund will rely upon an advisory council that includes Reid Hoffman, founder and chairman of LinkedIn; Josh Koppelman, founder of First Round Capital; and Rajeev Motwani, professor of computer science at Stanford University and early advisor to Google.

   Why are you forming this?
   We are forming this fund to help grow the Facebook application ecosystem. By decreasing the barrier to start a company, we hope to entice an even larger group of people to become entrepreneurs and build a compelling business on Facebook Platform. We hope this is also a funding model that other venture capitalists will follow.

   How will you decide on investments?
   Anyone will be able to apply for an fbFund grant from the Facebook website. All proposals will be reviewed by the advisory council and then approved by the investment committee. The goal is to get decisions to potential grantees within the month that they apply.

   How does an individual or company apply?
   Initially, you can mail your business plan to platform@facebook.com. In coming weeks, we will set up an online submission process. Submissions are being accepted immediately.

   What will be the criteria for selection?
   We want to see the most innovative and ambitious proposals for building a business on Facebook Platform.

   How long will it take to hear back from the fund?
   The goal is to get a response to the applicant within 30 days of receipt.

5. bob cobb
   

   September 17th, 2007 at 6:27 pm

   Will they fund apps that are already running but looking to improve?

6. Dan Birdwhistell
   

   September 17th, 2007 at 7:08 pm

   Guddam this is smart as hell. No-recourse grants!?!?! in business!?!?! Love it when smart people shake up the system. The old guys just don’t get it.

7. Alex
   

   September 17th, 2007 at 7:19 pm

   #4 thanks for posting the requirements and data points.

   Two things caught my attention:

   1) …Any individual or company, anywhere in the world can apply as long as they have not raised any formal venture funding
   - This is how Facebkok and their investors keep it in the “family”. Some would say this is collusion. By enticing young entrepreneurs to build directly on the FB platform the VC”s keep companies from looking elsewhere. My take, BRILLIANT!!!!!

   2) …Additionally, the fund will rely upon an advisory council that includes Reid Hoffman, founder and chairman of LinkedIn; Josh Koppelman, founder of First Round Capital; and Rajeev Motwani, professor of computer science at Stanford University and early advisor to Google.
   - Why is Josh Koppelman on this advisory board? Did he invest in Facebook? Is there a deal where Josh’s fund will do follow on investments in the promising companies? Josh if you are reading these posts maybe you can enlighten us.

   btw- this is exactly what Salesforce should have done with there AppExchange. However, arrogance got the better part of Salesforce and this is why AppExchange has been a failure to date. For the love of god Marc Benioff there CEO sells 10,000 (approx. $450K) shares EVERYDAY. You’d think that he could have funded this himself and increased innovation of his platform.

8. tav
   

   September 17th, 2007 at 7:47 pm

   A facebook group — http://www.facebook.com/group.php?gid=5207867210 — for those interested in fbFund

9. Steve Ballmer
   

   September 17th, 2007 at 8:40 pm

   Interesting, I would have given twice what everyone else did if I were invited.
   http://fakesteveballmer.blogspot.com

10. DT
    

    September 17th, 2007 at 8:41 pm

    They ask you to submit a business plan.
    Do they actually want you to write a full 15-20 page business plan to just create a facebook app?

11. Steve Jagger - Ubertor.com
    

    September 17th, 2007 at 8:46 pm

    Great News. This should be interesting!
    See everyone again tomorrow.

12. tpain
    

    September 17th, 2007 at 8:49 pm

    
    
13. Mark
    

    September 17th, 2007 at 9:16 pm

    Now I’m not feeling so dumb for registering faceosphere.com last week!

14. Fabian Schonholz
    

    September 17th, 2007 at 9:25 pm

    I think this is brilliant. It keeps the machine self feeding and created a tighter ecosystem. Basically internally supported external ideas. The best of all worlds. Really smart.

15. Wes
    

    September 17th, 2007 at 9:36 pm

    I think its a good idea by Facebook idea to fund applications built on its own platform but I wonder whether its a reaction to Bay Partners initiatives.

16. rc
    

    September 17th, 2007 at 9:49 pm

    good article good coverage !

    rc

    trading tennis

17. chrisco
    

    September 18th, 2007 at 3:19 am

    this is great, but facebook is just following the script… yawn… i wonder what’s on youtube now.

18. chrisco
    

    September 18th, 2007 at 3:34 am

    @ Rob (#4): That email address appears to be bunk. See below:

    Delivery to the following recipient failed permanently:

    platform@facebook.com.

    Technical details of permanent failure:
    PERM_FAILURE: SMTP Error (state 13): 550 No such domain at this location (platform@facebook.com.)

19. Mark
    

    September 18th, 2007 at 10:57 am

    The Face Race is on!

20. DiggUser
    

    September 18th, 2007 at 11:25 am

    Interesting. I wonder how Facebook will fare.

21. startupflames.com
    

    September 18th, 2007 at 11:45 am

    so no-recourse just means that they don’t take any stock? Seems not too shabby. Are apps that have a facebook presence and regular web presence allowed?

22. Trey Philips
    

    September 18th, 2007 at 11:55 am

    @ chrisco (#18): remove the period from the end of that email address (.com., with the period, is not a domain)

23. Ben
    

    September 18th, 2007 at 11:57 am

    Does anyone know what type of confidentiality agreement, if any is involved in the process? Isn’t this a way for facebook to harvest the ideas then take them for themselves, at least the good ones?

24. Jim
    

    September 18th, 2007 at 12:46 pm

    Has anyone that applied to Bay Partners received any funding? Their supposed “fast track” approval process has been anything but to me and my team.

    This will no doubt undermine the popularity and viability of Bay Partners program, as facebook can and will likely give preferential treatment to its “in house” projects.

    For this reason alone, maybe its a good thing Bay Partners has been so slow, as I’d much rather get funding by fbFund…

25. aguytryingtofinishhisspaghetti
    

    September 18th, 2007 at 6:22 pm

    I’m going to burst everyone’s bubble just a sec.

    This is simply a last hope at getting some really good ideas on fb. The fb team doesn’t have any (or else they would make them) And the majority of ideas thus far, are, for the most part, useless. The platform is going to have to change or app sickness will surely set it.

26. Peter
    

    September 18th, 2007 at 8:08 pm

    This only make sense considering the high costs of running popular FB apps that companies have reported. Whether or not this is a good move on Facebook’s part, is another question.

    As pointed out, there are far too many annoying or useless apps out there that dilute the content of the site. The aim of funding is to increase the quality of the applications and make it a viable option for startups. But will Facebook users accept the further influx of apps that will result from this announcement?

27. aguytryingtofinishhisspaghetti
    

    September 18th, 2007 at 8:24 pm

    I’m not convinced, yet, that there are a bunch of ideas out there left to be discovered. FB has 60+ of the smartest developers around and they aren’t coming up with anything better than a politics app. Also, running popular apps may be expensive, but creating them isn’t and not many of these creators are holding back because of what it could cost if it becomes popular… i don’t think. And you know, there have already been a few socially smart/successful apps that have been built but have done horribly (digg and delicious). Maybe the platform is there, but nobody’s figured it out yet…including fb.

28. chrisco
    

    September 18th, 2007 at 10:40 pm

    @ Trey (#22): Thanks… dhoo! I just right clicked the link in #4 and pasted and hit send… and the right click picked up the “.”

29. ramkumar
    

    September 19th, 2007 at 4:41 am

    I think its a good idea by Facebook idea to fund applications built on its own platform but I wonder whether its a reaction to Bay Partners initiatives.

30. IntrudersTV
    

    September 21st, 2007 at 7:49 am

    Here is the video of Michael Arrington interviewing Mark Zuckerberg at TechCrunch40 including the fbFund announcement

31. Jimmy Huen
    

    September 22nd, 2007 at 6:46 pm

    Does anybody know if taking the grant, will it confine the growth of the app within facebook only and not allowed to extend to an external site later?

    Let’s say if I apply and got accepted and the app grew, and I wish to have its own external website like I originally wanted to, will taking part in the “grant” kill that?

32. Tom Krieglstein
    

    October 10th, 2007 at 7:03 am

    I really don’t think it’s in the long term interest of FB to steal anyones idea. It would be like ebay seeing what business do well on their platform and then internally replicating it for a profit. It’s just not the business model of the platform.

    The success of the platform is UGC, and if FB pisses off it’s users then it has no platform.