Fund to Invest $25M in Startups has launched a US$25 million investment fund to encourage the development of new applications using its hosted development platform.

The fund, created with investment companies Bay Partners and Bessemer Venture Partners, will make investments of $500,000 or more in start-up companies using, the companies announced Monday. refers to as its "platform as a service." It allows companies to build add-ons to's hosted CRM (customer relationship management) software, or entirely new hosted applications, using pre-built database, logic and workflow services from

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The goal is make it easier to build hosted applications by letting provide the underlying infrastructure services.

Last month, released a new part of called Visualforce, a tool for creating user interfaces in HTML, AJAX (asynchronous JavaScript and XML) or Adobe Systems' Flash.

The tool is valuable because it lets companies build applications that don't have to have the same look and feel as's own applications, which wasn't possible before, commented analyst company Ovum. didn't say how much each company is contributing to the investment fund, only that they will invest about $25 million over three years. will act in an advisory capacity, it said.

Bay Partners has already invested in companies that list their applications in's AppExchange marketplace, including Eloqua, which makes demand generation software, and Xactly, which develops sales management software.

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