In their hunt for the killer app in the new era of the social web, Facebook, Amazon, Zynga and other major technology companies have established a $250 million fund.
The backers – which also include Comcast and Liberty Media – will be led by Silicon Valley venture capital firm Kleiner Perkins Caulfield & Byers, an early investor in Amazon, Google, and AOL.
"There's going to be an opportunity over the next five years or so to pick any industry and rethink it in a social way," said Facebook's Mark Zuckerberg at an announcement of the fund at the company's headquarters. "We think that every industry is going to be fundamentally re-thought and designed around people."
Facebook, which has more than 500 million members, is only the start of the next wave of "incredible and disruptive innovation," Kleiner Perkins partner John Doerr said.
The sFund, as it's called, will supply financing, advice – and contacts. Facebook will give the new generation of start-ups access to its platform teams, beta APIs, and new programs. Amazon, which wants to find start-ups that will use its cloud computing offerings, will hand over a year's access to Amazon Web Services, as they're called. The company will also supply business and technical support.
"These social apps do tend to be very viral, and when they hit, they hit fast and they can grow violently," Amazon CEO Jeff Bezos said. "That really does play to the strengths of Amazon Web Services."
The sFund is modelled on KPCB's $200 million iFund, launched in 2008, which invests in companies that create applications for Apple's iPhone, iPod touch, and iPad. So far, the iFund has invested in 14 start-ups.
The sFund won't invest in direct competitors to Facebook, Amazon, or Zynga.
"We intend to be very loyal to the people we are working with. Our hopes and dreams get kind of enmeshed with theirs," KPCB partner Bing Gordon, who will lead the fund, told BBC News. Bing was formerly the chief creative officer of video game publisher Electronic Arts.
He added: "The companies we will invest in will be the Zynga of health, the Zynga of education, different kinds of commerce, of social utility, of finance. There is an opportunity to build Zynga-sized companies that will scale up.
"Social is just getting started and the opportunities are vast. As in the early days of the internet, the race is on."
Why isn't Google, which has social aspirations, taking part in this fund? When reporters put the question to Doerr, who sits on the search giant's board, he responded: "Google is still developing their social strategy. Stay tuned."
The sFund's first investment: $5 million in Cafebots, a Palo Alto start-up in stealth mode.
The brainchild of three Stanford University graduates, the company hasn't released a product but is working on a "friend relationship management" platform to help people use social networks more effectively.