TinyURL Rival Bit.ly Raises $2 Million

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Bit.ly, a URL shortening service similar to TinyURL, has raised $2 million in Series A financing from O’Reilly Alpha Tech Ventures and angel investors, including Mitch Kapor and Howard Lindzon (an investor in our parent company). Betaworks, the NYC-based fund/incubator, will spin Bit.ly out as a separate company.

What’s the point? There’s actually several potential commercial applications for Bit.ly, such as renting out the technology to companies to use with custom domain names. For instance, if we wanted to have our own vanity short URLs for The Business Insider posts, we could potentially get a domain like tbiurl.com and have Bit.ly generate short URLs with that domain.

Beyond shorter URLs — handy on Twitter, etc. — Bit.ly also provides analytics, Twitter link tracking, etc. People clicked on 20 million of their links last week, and that number is growing 10% per week, according to Bit.ly.

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