Angels back gay network

Friends You Know is beta testing its social network for LGBT (lesbians, gays, bisexuals and transgenders/transsexuals) after raising $350,000 for its first round of funding from a cadre of Illinois-based investors, including a number of angels, according to regulatory filings.

Funding comes from CEO Matthew Small, the Eugene B. Shapiro Revocable Trust, the Vicki Lehrner Adams Revocable Trust and the Daniel T. Zagorin Trust.

The company has targeted $4 million for its Series A round.

It should come as no that a social network for the LGBT community might attract angel financing. It’s a justifiably big market. Wikipedia reports that somewhere between 1% and 10% of the population is exclusively homosexual.

Friends You Know may face tough competition, however. TechCrunch writer Marshall Kirkpatrick offers an informative survey of eight other social networking sites targeted at the same market. Meanwhile, Mashable’s Pete Cashmore offers another four gay social networks launched last year.

Friends You Know’s financing is proof that social networking remains a popular place for early stage investors. More than 30 social networking companies closed on funding last year.

For example, in other social networking news, TeeBeeDee has increased the size of its Series A, according to a regulatory filing.

The company, which is building a social network for the elderly, announced it had raised $4.8 million last fall, but has since increased its target to $7.81 million.

It has raised $6.3 million of that target from 18 investors so far, according to the filing. Backers listed include Shasta Ventures, Monitor Venture Partners, the Melone Family Trust and individual investors David Nierenberg and Bruce Rauner.