Sourced From; Seattle 2.0; By John Cook Permalink
Madrona Venture Group has led a $5 million investment in Jambool, developer of the Social Gold virtual currency system. The startup — with offices in Seattle and San Francisco — is led by former Amazon.com employees Vikas Gupta and Reza Hussein. And its in-game payment system and virtual currency platform is currently being used on sites such as Facebook, MySpace and — most recently — the RealNetworks’ RealGames operation.
Gupta previously worked in Amazon.com’s payments division and co-invented the online retailer’s Flexible Payments Service. TeachStreet co-founder Dave Schappell, who worked with Gupta at Amazon and is serving as an adviser to the company, said that Jambool has a leg up on competitors because of that experience.
“The difference with them is that Vikas and his team really know payments,” said Schappell. Mikhail Seregine, a former Amazon.com engineer who most recently founded Seattle startup ClayValet, also is working on the company.
Contacted last week about the investment in Jambool, Madrona’s Matt McIlwain would only say: ”I have heard good things about Jambool.” He declined further comment.
Gupta also declined to comment about the funding deal last week.
Of course, Jambool could face competition if the social networking sites were to offer their own payment system. And TechCrunch reports that other startups such as OfferPal and Gambit also exist, though Jason Kincaid notes that Jambool has an advantage since the Social Gold platform can work across multiple social networking sites.
The most recent investment follows a $1 million round that Jambool raised last year from Hit Forge, Charles River and Bay Partners.
The deal also comes at a busy time for Madrona, which in the past five days has announced more capital for Seattle startup Z2Live and named former aQuantive CEO Brian McAndrews to the position of managing director. Madrona also has another funding deal that’s set to be announced this morning, so check back for more details on that around 4 a.m.
