RockYou Raises $35 Million

The battle of master widgeteer continues with today’s announcement that RockYou has raised $35 million from DCM, the company which provided $1 million in interim funding. Apparently the interim funding was provided while the terms were being nailed down. Whatever the case, this is yet another massive round of funding for the widget market. Slide raised $50 million at a $500 million valuation and Clearspring recently raised $18 million at an unknown valuation.

Widgets are a clear part of the social web, providing content creators with a broad distribution channel for their original content. How broad of a distribution channel you ask? Well RockYou in particular reaches over 87.5 million people per month. The company has found a substantial amount of success on the Facebook platform and has continued that trend on to MySpace and hi5.

Not everything is rosy in the widget and social application world though. Just yesterday it was revealed that Slide, the largest developer of social applications, will stop releasing new Facebook applications. While the company didn’t provide complete details of their reasoning, one of the primary issues was that it has now become extremely difficult to launch new applications on Facebook with the increasing viral growth restrictions.

While RockYou and Slide generate the majority of their traffic from social networks, they are both generating traffic from their core sites as well. Clearspring, a leading widget distribution platform, is also generating a substantial amount of traffic from outside social networks given that their widget platform runs practically anywhere on the web.

It is still relatively early for these companies though but it is clear that investors are willing to take a gamble. Over $100 million has poured into social applications and widget platforms with the majority of funding going to the leaders. RockYou clearly needed to position themselves as a front-runner in this space and with their new round of funding they can continue their leadership position.