RockYou Raises A Whopper - $50 Million In Venture Capital
Social Network application developer and advertising platform RockYou has raised a whopping $50 million in a Series D round of financing from existing investor Softbank, we've confirmed with the company.
Context & Ripple Effects
RockYou’s new round follows a 2008 $35 million financing for its social-network apps and a later 2008 $17 million raise tied to its Asia ambitions. Softbank’s participation as an existing investor extends that funding relationship at a time when reported venture funding had fallen sharply.
First-order effects
- RockYou gains $50 million to support its social-network application and advertising-platform operations.
- Softbank increases its financial commitment to RockYou through the Series D rather than bringing in a newly named lead investor.
Second-order effects
- RockYou’s earlier Asia objective is better funded, giving the company more capacity to execute on an expansion it had already outlined.
- The round gives RockYou a stronger capital position than social-application rivals seeking funding amid a broader venture-market contraction.
Third-order effects
- If follow-on rounds increasingly come from existing backers, venture firms may concentrate scarce capital on portfolio companies they already know rather than on new investments.
- The financing points to social-network applications and advertising infrastructure becoming a more capital-intensive contest, where repeated fundraising helps determine which platforms can scale.
The trend: Venture funding is becoming more concentrated behind established social-platform bets, with existing investors playing a larger role in sustaining them through a constrained market.