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Alongside Apple's (Nasdaq: AAPL) launch of its software development kit (SDK) and roadmap for its iPhone 2.0 beta software Thursday, Apple's CEO Steve Jobs introduced a "one more thing" announcement -- a US$100 million private investment fund earmarked just for iPhone and iPod touch development efforts.
Dubbed the "iFund" by the venture capital firm Kleiner Perkins Caufield & Byers (KPCB), the money will be invested in companies that have "market-changing ideas and products that extend the revolutionary new iPhone and iPod touch platform," KPCB noted.
"We think several significant new companies will emerge as this new platform evolves, and the iFund will empower them to realize their full potential," said John Doerr, a partner at Kleiner Perkins Caufield & Byers.
"We gave a lot of thought to what the size should be of this iFund," Doerr said at the Apple SDK announcement event. "And you know, it took a couple million dollars to start Electronic Arts (Nasdaq: ERTS), $8 million to start Amazon (Nasdaq: AMZN), $24 million to start Google (Nasdaq: GOOG). So we decided the iFund should be $100 million," he explained.
Bursting Ideas
"Developers are already bursting with ideas for the iPhone and iPod touch, and now they have the chance to turn those ideas into great companies with the help of world-class venture capitalists," noted Jobs. "We can't wait to start working with Kleiner Perkins and the companies they fund through this new initiative."
Apple will provide KPCB with market insight and support, though neither company expressed detail in the scope of such support.
The iFund will be led by KPCB partner Matt Murphy in collaboration with partners John Doerr, Bill Joy, Randy Komisar, Ted Schlein, Chi-Hua Chien and Ellen Pao, KPCB reported, noting that the initiative will be agnostic to stage and size of investment. It will focus on areas including location-based services, social networking, m-commerce, communication and entertainment. The idea, of course, isn't so much to fund a cool new application that might sell well so much as to be to fund "entrepreneurs pursuing transformative ideas with the potential to become standalone, public companies."
In addition to providing capital, KPCB said it will assist with company-building expertise, business development relationships and access to its vast network of talented entrepreneurs.
Room for Google's Android and RIM's BlackBerry?
iFund is focused completely on the iPhone and iPod touch world, not the smartphone market, which means it's not designed to attract developers focusing on Google's Android or RIM's BlackBerry devices. Still, there will likely be a little crossover.
"Clearly there are other platforms which developers will want to write to in order to address an even larger user base, but we believe all important apps will certainly be written to the iPhone -- not exclusively -- to maximize the experience," Murphy told MacNewsWorld.
"What's exciting about the iPhone is the UI/device, development environment, and engagement demonstrated already by its users ... it's off the charts relative to any other platform," he explained.
"[I] am sure you've seen the data that 90 percent of iPhone users are using the mobile Internet regularly relative to 20 percent on other phones on average. This is enormous, and this user base is rabidly awaiting other new applications and services," Murphy added. "With the native apps and integration with things like the accelerometer, location info, address book, camera, etc., the possibilities for innovation are boundless."
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