New Fund To Feed RSS Startups

A $100 million fund has been launched to focus expressly on making investments in RSS startups.

Whether the new Boston-based firm, called RSS Investors, is ahead of or behind the epidemic-like spread of RSS remains to be seen.

RSS, which stands for “really simple syndication,: is an XML format for syndicating Web content.

Its team is comprised of Steve Smith and Tom Crowley, both of whom worked at GE Capital as managing directors prior; John Palfrey, an Internet law expert at the Berkman Center for Internet & Society at Harvard Law School; Jim Moore, a technologist and formerly a senior fellow at the Berkman Center; and Richard Fishman, a senior vice president at the small venture outfit MacAndrews & Forbes.

At least one LP is sold. Ritchie Capital Management has given the team its first close of $20 million toward its goal, which Palfrey characterizes as realistic.

“We spent a lot of time modeling things and looking at where opportunities lie for RSS technologies,” he says. “Also, if you look at all the software companies that are trying to work RSS into what they are doing, one could construe our mandate quite broadly.”

The team has yet to make an investment, but it is meeting with companies. Palfrey suspects the firm won’t be long in pulling the trigger on a deal.

“The move from a more static HTML-based Web to a more dynamic, syndication-based Web is going to be highly impactful,” he says. “We’ll see more than enough startups in which to invest in.”

He did not say how long it might take to spend $100 million on RSS. Though a growing number of individuals and enterprises, such as Microsoft, embrace RSS, throngs of RSS startups do not exist. And those that do are just now receiving backing, typically in undisclosed and presumably small amounts.

For example, Feedster, a two-and-a-half-year-old search engine for blogs and RSS feeds – which is partly backed by such Internet entrepreneurs as Excite co-founder Joe Kraus and Tribe Networks founder Mark Pincus – just this summer announced that it had moved past the seed stage to raise a Series A round. Selby Venture Partners led the investment. The round size was not disclosed.