What’s Up, “G”?

chahal.jpgUpdated: From his ostentatious display of wealth to his appearance on Fox’s “The Secret Millionaire,” one thing is for sure, if you live in Silicon Valley, you’ve heard of Gurbaksh Chahal, also known as “G.” Thanks to his antics, there are many tall tales about the man. And while they may or may not actually be true, one thing cannot be denied: He has a nose for money. And now he’s out raising capital for his third and newest startup, gWallet, a San Francisco-based provider of virtual currency.

Chahal is looking to raise around $10 million in venture funding, according to Silicon Valley sources. (Chahal told the AllFacebook Inside Facebook blog in August that he was going to raise a big round in the next few quarters.) The company, which has also snared former venture capitalist, Alex Gove, is said to be attracting BlueLithium alumni. Gove worked with Walden VC, the firm that backed BlueLithium.

And BlueLithium, of course, was one of two online advertising starups founded by “G,” the other being ClickAgents. They were sold to ValueClick and Yahoo, respectively, for a total of $340 million. BlueLithium was acquired for a whopping $300 million, though it still isn’t clear what Yahoo has done with it.

When it launched earlier this year, gWallet was focused on the online coupons business, but since then has switched gears and is focusing on the virtual currency business. This is an increasingly crowded space, one in which competitors such as Offerpal and Super Rewards have an early-mover advantage. Others, such as social gaming startup, Zynga, have started their own virtual currency-related efforts.

Updated: I spoke with Gurbaksh and he confirmed that the company is in talks with multiple venture capitalists. Either the company is going to raise $10 million over next four weeks or they will wait till January 2010 before raising money. In the interim, the company is going to keep hiring and growing its business, helped by funds from Chahal. “This space is much like the Wild West advertising market when I started my first company back in 1999,” he said. Chahal believes that he can build a better mousetrap and put together a crack sales team. “We are looking to apply this model to micro transactions beyond social gaming,” he said. For instance, WiFi-in-the-sky or WiFi at airports are two places where his company can easily expand.

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