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Facebook App Gets Bank
Is Facebook now the hot tech incubator?
A months-old tech startup conceived as a Facebook application has raised $10 million in venture capital funding, as well as more than a few envious eyebrows. Lending Club, which allows web users to virtually swap Hamiltons, yesterday announced its A-series round from Canaan Partners and Norwest Venture Partners.
The funding announcement is the first evidence that Facebook's strategy of "opening" its social network platform to startup-minded programmers is beginning to generate financial results. There are dozens -- maybe hundreds -- of Facebook application developers currently vying for precious VC dollars.
Lending Club is one of several start-ups trying to bring online and wireless financial services to small online vendors and individuals, much like Obopay, the virtual "Western Union" Portfolio.com profiled last week.
"Lending Club has been used by over 13,000 Facebook users and has fulfilled over $750,000 in person-to-person loans," a Lending Club spokesperson emailed Portfolio.com
"Lending Club has enjoyed significant early success with the Facebook launch in May, and we see great opportunity for the company," said Jeff Crowe, general partner at Norwest Venture Partners, who now joins Lending Club's board.
So take a good look at those Franklins, Jacksons and Hamiltons. Might even want to tuck a few of them away for safe-keeping. They'll soon be heirlooms.
by Sam Gustin
Laura Rich is a co-founder of Recessionwire, which provides news, advice, perspective and humor about the recession and the recovery.
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