Greylock Partners’ stake in Facebook, Digg and LinkedIn furnishes it with a unique perspective on social networking. So, while moderating the Internet panel at The Deal’s Silicon Valley Summit today, I asked James Slavet, a partner at the venture capital firm, what makes one social network thrive while a hundred others stagnate.

He said he looks for an authentic vision from the founder. He also takes into account the early growth rate. And he isn’t deterred from investing in a company that is only popular with the early-adopter crowd. This was the case when Greylock originally invested in Digg and LinkedIn.

Toby Coppel, Yahoo’s senior vice president for corporate development, said the company has hired sociologists to better understand how social networks are constructed and economists to get a better grasp of how these social marketplaces are evolving. He added that one critical element of any social network is openness. Oh yeah, and for the record, neither James nor Toby commented on the speculation surrounding Yahoo's potential acquisition of Facebook.

Toby Coppel at The Deal's Silicon Valley Summit

James Slavet at The Deal's Silicon Valley Summit

For more on The Deal's Silicon Valley Summit, see:
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Brian Ward

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