Online social networking phenomenon Facebook Inc announced that its backers have created an unusual $10 million fund to dole out grants to start-ups with ideas for innovative Facebook applications.

Facebook is working with its primary venture backers, Accel Capital and The Founders Fund, to create a way for people with new ideas to receive an initial funding grant of $25,000 to $250,000. The grant will not require the entrepreneur to give up any equity in his business, unlike the usual requirement of venture capitalists.

"We are looking for innovative and disruptive things," Mark Zuckerberg, CEO of Facebook, said of projects the grants might fund.

Gillian Parrillo
The Sacramento Executive