As the world awaits Apple's first shipment of iPads next month, venture capitalists race to fund developers who will create a new generation of applications for the device.
While there are several existing iPhone apps that are tailor-made for the iPad and its 9.7-inch touch screen, new energy and capital is flowing to apps conceived with the iPad already in mind. Last week saw the debut of the AppFund, which will invest between $5,000 and $500,000 in iPad apps (as well as applications for other tablet devices). Founded by media and technology veterans Kevin Wendle and Daniel Klaus, the New York-based AppFund is bringing a Hollywood studio-like mentality to producing new games, social networking tools and business applications for the iPad.
Wendle, one of the founding executives of the Fox Network and E! Online, is looking for hits as well as "apps that will become utilities in everyday life", according to the AppFund website. As the iPad literally brings a new dimension to the app experience, the firm is targeting developers who can creatively incorporate video, audio and graphics specific to the new device. There is also an emphasis on funding the development of apps that can attract early adopters to new technology as well as affluent, urban-dwelling hipsters under 40.
Prior to Apple's January 27 debut of the iPad, the company worked directly with game developers including EA Mobile and Gameloft to test how their titles would translate to the larger screen size. Developers hoping to raise capital from the AppFund and other venture investors in the space might find breadcrumbs for what works best on the iPad with apps like shooter game N.O.V.A. Near Orbit Vanguard Alliance and racing game Need for Speed Shift.
As EA Mobile vice president Travis Boatman observed, "building for the iPad is a little different - it's kind of like holding an HD display up to your face."
The Kleiner Perkins iFund expands its approach
Elite venture capital firm Kleiner Perkins Caufield & Byers (which has backed Google, Zynga among other iconic technlogy and gaming companies) was a pioneer in investing in iPhone applications when it launched the $100 million iFund last year. The iFund has eight portfolio companies to date, including Booyah (developer of the popular location-based social game myTown) and ngmoco (the first game developer to focus exclusively on iPhone apps).
Matt Murphy, who manages the iFund, views the iPad "more in the vein of the iPod touch as a pure entertainment device." In addition, because the iPad lacks phone and SMS messaging plans, Murphy anticipates apps like textPlus developed by KPCB company GOGII to take off.
"There will always be new opportunities even people don't understand all the capabilities yet," Murphy said. "More real estate will enables developers to put more functionality into the app."