Paypal founders Peter Thiel and Ken Howery and additional limited partners have set up a fund to pool the money and focus on portfolio support:

"We've been making early-stage VC investments since 1998, so we thought we should just set up a fund to formalize what we'd been doing for seven years," Howery said. "The bubble implosion is also starting to sort itself out, so we have clarity in what works and what is fairly valued (in consumer Internet ventures)."

The new fund was raised both with capital from the partners as well as from several limited partners, whom Howery would not name. The firm will provide seed and early funding of around $500,000 to $1 million."