On Malik makes some interesting points about the increasing interest by venture capitalists in blogs:
I have a couple of micro-scoops for you. My sources tell me that David Sifrys Technorati is about to receive a substantial bit of funding, most likely from August Capital soon. No confirmation, and this could be a rumor of course! (And talking about rumors, Tribe.Net is also close to getting a big round of funding from one of the Valley big guns, though it has nothing to do blogging!) Elsewhere I have heard Scott Rafer, co-founder of Wi-Finder and newly appointed chief executive officer of FeedSter is beating down the bushes for funds and will get them shortly. His model of combining ad words with RSS feeds is an attractive business proposition. Chris Alden, the co-founder of the vintage Red Herring magazine is working on a start-up that will be a combination of blog-directory and a publication. (Details pending!)
Many start-ups have cropped up and are copying the hosted web logging business model of TypePad, and others are in the works. This market is getting fiercely competitive and over crowded. These are all interesting developments, and hopefully will help some of the blogging start-ups we love so dearly. (My big question is who are the people most likely to get funded next?) Having seen the blogging evolve from its early days, I find it amusing that venture capitalists have suddenly discovered this new trend. Herds! or Un-Smart Mobs!
While funding tool makers or service providers such as Six Apart and FeedSter makes sense, I am not so sanguine on the prospects of weblog-pubs etc.