"Countless" Opportunities in Facebook

Thanks to David Miller of Campus Entrepreneurship for Facebook Launches Countless Entrepreneurial Opps, which cites the Wall Street Journal story
Why So Many Want to Create Facebook Applications.

Another online gold rush is on. Entrepreneurs are scrambling to create small software programs for Facebook Inc.’s social-networking site and grab footholds in its emerging economy.

Three months ago, the Palo Alto, Calif., company invited software developers to create applications for its site. The response was immediate: Facebook says more than 70,000 developers, from college kids to big-corporation engineers, have signed up for the tools needed to build the free applications.

The Journal says there are already more than 2,000 applications on Facebook with more than 100 users each, and venture capital is getting interested.

Menlo Park, Calif.-based venture firm Bay Partners has raised $300 million specifically for companies developing Facebook applications and is making $25,000 to $250,000 investments per application. “All Internet companies need a Facebook strategy or a presence on Facebook,” says Partner Salil Deshpande, because Facebook usership is growing so quickly.

The source story has several examples of early Facebook applications that are taking off. It doesn’t, however, explain whether and how any of them are making money. Apparently this is another situation in which investors and entrepreneurs are looking for traffic first, and assuming money will come later.

The traffic is there:

Facebook’s monthly visitor numbers doubled to 30.6 million in July from six months earlier, according to measurement firm comScore Networks Inc.

Does traffic equal opportunity? I’m not sure. I was there 7-10 years ago when that was the going explanation for a lot of mysterious doings, and I was as fooled as most of the others. So this time I’m just watching with interest.

-Tim