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Digg gets more cash, $8.5 million

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So now you know why they did the big redesign, added video and all those fancy new features. Digg has raised another $8.5 million in new funding from existing VCs, Greylock Ventures and Omidyar Network. The company, previously had raised close to $3 million from these two firms, and Marc Andreessen, co-founder of Ning and Netscape.

Kevin Rose and Micki Krimmel

Hopefully this money will be spent wisely, to grow the business into a profitable entity. After all, Greylock’s David Sze, one of the backers of Digg, tells Venturebeat that Digg is not going to be sold anytime soon, and instead will partner with others who want to incorporate Digg-features in their offerings.

If not selling out the company to someone bigger, then the only other exit option for Sze and other investors is to go public. In other words, Digg will have to grow its sales rapidly, become profitable, and go public.

But then…..

“Our board and investors did not want us to focus, at any time, on monetization at this stage,” said CEO Jay Adelson. “Our focus has been on user growth.”

Digg, certainly has its work cut out. There has been growing negativity enveloping the San Francisco-based start-up. There have been stories of Digg gaming, spamming, and doubts about their pageviews. As Digg grows up, both in popularity and as a company, it is becoming the focus of relentless scrutiny.

Photo via Zooomr by Thomas Hawk

11 Responses to “Digg gets more cash, $8.5 million”

  1. Anthong

    I’m flummoxed. I’ve used Digg before, and while it’s a good concept, there’s really nothing unique or partucularly unique. It’s great to put the control of news into the user’s hands, however, it’s been well documented that most stories that make it to Digg’s homepage are selected by a few users.

    I’ll stick to

  2. Good on Digg!! I love the site and I think the people behind it are passionate about it which usually leads to good things. I hope they can actually start making some profits. I mean does every company have to sell out?

  3. digg is useful for a good amount of quality information and news and then they have “the crap”. I like the idea the most and “the lab” tools that show real-time statistics. This new Web 2.0 era will bring many new and slightly not things.


  4. I think the community is such a fragile thing, and well this negativity and all that stuff does have an impact. i frankly love the service, since it helps me find good stuff. look at the previous post on wifi and open source. couldn’t have found it without digg, to be honest. i hope they make it to the finish line!