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SAN FRANCISCO - Social network software maker Slide has closed a US$50 million institutional financing round, marking the rising valuations of start-ups riding fast-growing Facebook's wave of popularity.
Slide made some of the hottest programs running on Facebook and News Corp's MySpace, including media-sharing applications Slide Shows, Top Friends, SuperPoke! and FunWall.
Max Levchin, its Ukranian-born and Chicago-raised founder, declined to name the investors. But sources close to the deal said they were Fidelity Investments and T Rowe Price.
The round is nearly 10 times the size of the median round of $5.18 million for Web 2.0 firms in the first half of 2007, according to Dow Jones investment tracking unit VentureOne.
This follows the roughly $500 million recently raised by Facebook from Microsoft and Hong Kong billionaire Li Ka-shing, giving it an implied $15 billion valuation.
Slide, incorporated in 2005, was originally self-funded by Levchin, 32, who co-founded online payments company PayPal a decade ago. He later took funding from Peter Thiel, the other founder of PayPal, which eBay.
Subsequent funding for San Francisco-based Slide was provided by leading Silicon Valley venture capitalists Mayfield Fund, former Nokia venture arm BlueRun Ventures, Khosla Ventures and Founders Fund, Thiel's venture fund.
These earlier rounds of funding totaled in the "low tens of millions of dollars," one of the sources said.
Dot-com resurgence
Slide is among the first companies to capitalise on the success of Facebook and MySpace in becoming central stages for consumer web use, playing the role of Windows in the personal computer era or the Netscape browser in the early web days.
Comparing the social network software generation with the dawn of the PC era, Levchin said Slide was poised to lead in the same way that Adobe, Electronic Arts and Intuit became leaders 20 years ago in design and imaging, games and finance.
"We believe there is a huge opportunity to build this next set of businesses," Levchin, a self-described caffeine addict who often sleeps just two hours a night, said in an interview.
Slide is based in the heart of San Francisco's former warehouse district, now a hotspot for media and software start-ups like Six Apart, Yelp, Hi5 and StumbleUpon. T-shirted programmers work long hours huddled at rows of PC-cluttered tables, as pet dogs freely roam the Slide office.
Levchin said the new cash will fund accelerated development of products and features, both on Facebook and the soon-to-be-upgraded MySpace platform, while hiring should grow from its current 65 employees to 100 this year. Acquisitions are a low priority, he said, but not out of the question.
Slide's first popular application was a slide show application that allowed web users to dress up digital photos with glitter and other decorations to share with friends.
That caught fire on MySpace in 2006, before being built to run on other social networks. Slide then shifted its focus to Facebook ahead of that company's move last May to let outside developers build applications to run inside Facebook.
Although MySpace still has nearly double the 61 million users of Facebook, the latter has exploded beyond its roots as a college social network, topping MySpace in terms of media buzz, daily user activity, and software developer attention.
Slide has in turn emerged as the top developer of so-called widgets for Facebook. Web traffic researcher Quantcast says Slide attracts 50 million Facebook users monthly. Slide claims 143 million active users of its programs across the web.
- REUTERS
