Betaworks, a New York City-based Internet company, has raised $20 million in new venture funding, according to company executives. Intel Capital and previous investor RRE Ventures led the current round, which included Softbank, Founders Collective, DFJ Growth, AOL Ventures and the New York Times. The company had previously raised $8 million.
Betaworks, the brainchild of former AOL executives John Borthwick and Andrew Weisman, views itself as a holding company that both invests in and operates Internet and digital media companies.
In some ways for its investors, Betaworks is a bet on the newly emergent sector amorphously described as the real-time web. It is best known for its bets on the Twitter ecosystem.
The company first tasted success when it sold Summize, an early entrant into the real-time search market, to Twitter in July 2008 for a reportedly big stake in the San Francisco-based company. Since then Betaworks has launched and subsequently spun out URL-shortener Bit.ly, which ended up raising $2 million from the likes of Mitch Kapor and Jeff Clavier of Softech VC. It also created social media analytics company, Chartbeat, a company that emerged from the ashes of a failed Betaworks startup, Firefly.
In comparison to Bit.ly and Chartbeat, Betaworks is purely an investor in Tweetdeck, a very popular Twitter reader. “We have stakes in 24 companies –- some small and some large stakes,” says co-founder Borthwick. It owns a big chunk of five companies -– Bit.ly, Chartbeat, Tweetdeck, Twitterfeed and another startup currently in stealth.
Borthwick explains that the company will use the new funds to do two things: be more aggressive in investing in more startups while at the same time, do follow-on investments as their companies scale up.
Borthwick bristles at the idea of being equated to an incubator. He views Betaworks as a holding company in the mold of, say, Liberty Media and Barry Diller’s IAC. Of course, on the other end of the spectrum are disgraced names from another era, like CMGI.
P.S.: If you want to get a better idea of how Betaworks thinks about the world of Internet and digital media, check out this post from Betaworks’ Josh Auerbach.