Investors dig Digg to the tune of $29 million

Lots of this moving from VCs to Digg
Lots of this moving from VCs to Digg

Witness the power of Web 2.0! Social content aggregator Digg has just attracted a massive $28.7 million (£15.5 million) venture capital investment to expand its operations.

The money follows previous cash injections of $2.8 million in 2005 and $8.5 million in 2006, and should provide resources for Digg to double its staff to 150 by 2009 and move into some of those swank San Francisco office suites we hear so much about from our rabbit hutches here at TechRadar.

Digging foreigners

Digg is looking for new ways to analyse and categorise the 16,000 stories it receives daily, and is hoping to splurge some green on deeper category and topic content views, additional ways to discover and customise content, moving Digg into more overseas markets, and probably providing table football for every staffer.

Of course, taking all that money means that Digg will be under some serious pressure to earn some more. Venture capitalist Richard de Silva, who will be joining Digg's Board of Directors, says: "Digg is an enduring and iconic web property that has monetization opportunities that are an order of magnitude greater than other social sites."

The bottom line? Expect more ads and glossier ads on Digg, a more aggressive marketing platform and at least one Digg founder wrapping a brand new Lambo around a lamppost in the months ahead.

Mark Harris is Senior Research Director at Gartner.