By Facebook's math, one $25,000 grant + one $250,000 grant = a total of $250,000. In announcing the Round I winners, Facebook's Catherine Lee pulled a $225,000 figure out of thin air: "Once round two closes in December, we will announce our five finalists, each of which will receive up to an additional $225,000 in funding." I'm sure Facebook flack Elliot Schrage has some highly entertaining explanation for this which he will deliver straightfaced to other reporters, who will then call us and howl with laughter. For now, we're content to just blame Sheryl Sandberg.

Facebook had first promised an announcement for September 22, then October 10. The results finally came today — only after Valleywag pointed out the ongoing delay. Facebook is now spinning the "amazing diversity" of its winners. Translation: They gave up and picked them at random. A suggestion to Facebook's grant-granters: If no one deserves a prize, it's totally okay not to give one.

Here's an update for anyone who didn't get the memo: Facebook's applications "platform," a set of software tools for embedding timewasting entertainments within the social network's pages, is not a level playing field. Some applications are more equal than others. That's only become clearer since Facebook foolishly put Facebook's platform in the hands of its top flack, Washington-trained bloviator Elliot Schrage. Facebook's Great Apps program, meant to designate higher-quality applications, has become a shameful excuse for nepotism.

Awarding money on the merits is hard enough. When you mix in the need to help out your COO's brother-in-law's pet startup, or your ex-president's latest venture, it complicates matters. Is Facebook going to come out with a list of apps to fund that it's truly proud of? Or will this look more like an appropriations bill after it's made its way through Congress, larded with earmarks?

Last fall, Microsoft paid $240 million for 1.6 percent of Facebook, along with an advertising deal. That wasn't because it was a popular social network, but because the tech press was talking up Facebook as a platform for social applications — a Windows for widgets.

Facebook's platform has fallen far short of that promise. The successful apps widgetmakers created in the first year of the platform's existence succeeded through spammy viral tactics, not by being particularly useful or fun for Facebook users. Social-games maker Zynga, for example, makes its games easier to win for users who invite their friends to play. Facebook began changing its platform rules to discourage such tactics in January. This summer, it brought out the stick, suspending popular applications like Top Friends for violations.

Now comes the carrot, in the form of the fbFund. To taste Facebook's cash, developers must meet a specific set of criteria from Facebook. We've translated them from PR-speak below.

Facebook's criteria:

• Originality of Concept: Does the application introduce a great idea in a new and unexplored area?
• Market: Is this application targeted to key audiences or meet compelling market needs?
• Social/Useful: Does the application enable people to interact with each other? Does it deliver real value to users (including entertainment)?
• Expressive: Does the application allow people to share more information?
• Intuitive: Is the application compelling and easy to use? Does it have a well-thought-out user experience?
• Potential: Can it be a real business someday?
• Team: Do you believe this team can execute and is driven to succeed?

Facebook's criteria, translated:

• Originality of Concept: Does the application do more than bring a ripoff of a popular MySpace feature to Facebook? You know, the kind we can have an intern copy between yawns?
• Market: Would you use the app if it weren't created by you?
• Social/Useful: No really, would you?
• Expressive: Does the application allow people to share more information? Will it advance peace talks in the Middle East?
• Intuitive: Is the application easy to use? For a drunk frat boy at UCLA?
• Potential: Can it be a real business someday? Do you know what a real business is?
• Team: Do you believe this team can execute or do you we need to execute your team?

(Photo by Bill in Ash Vegas)

Hi XXX,

Thanks much for coming to present to the fbFund advisory board two weeks ago. We really appreciated your flexibility and dedication. Unfortunately, your application wasn't deemed an immediate fit with the focus for fbFund at the moment.

I want to stress that this doesn't mean that we don't believe in your application nor that it can't be successful. As your application evolves, we encourage you to reapply for a grant - there is no limit on how many times you can apply for a grant, and each funding cycle represents a new opportunity to receive a grant.

The advisory committee had some feedback on your application which you might find helpful, some of which we covered during the presentation itself. They suggested that:

* XXXXXX
* XXXXXX

I hope this feedback is useful to you as you continue to build your application. Of course (as our lawyers asked us to make clear), all feedback is provided on an "as is" basis, and your incorporation of feedback doesn't in any way guarantee that your application will receive a grant from fbFund in the future.

We're planning on posting more information on fbFund and the funding process shortly, and I'll let you know when those resources are posted.

I wish you the best of luck as you build your business, and hope to hear from you again in the future.

Cheers, and thanks again,

Ami Vora

While I do believe that many applications could have had stronger business plan than us, I think that the way they handled the entire grant offer reflects poorly on Facebook and how they treat dev community.

In an attempt to spur more applications, Facebook has started issuing grants from its fBFund to developers. A newly issued caveat: Facebook says that it reserves the right to fund competitors with similar applications, or develop lookalike applications in-house. It's a real problem; one unhappy developer says his "Shortcut" app for quickly finding friends has become, without so much as a "by your leave," a feature of Facebook's search. No surprise, really. In backing startups, Facebook is treating them much like a venture capitalist would — and VCs are infamous for refusing to sign nondisclosure agreements, or otherwise promise confidentiality.

Here's the full text of an email sent by Facebook to early grant applicants.

From: XXXXXXXXXXXXXX platform
Sent: XXX XX/XX/2007 XX:XX
To: XXXXXXXXXXX
Subject: XXXXXXXXXXXXXXXXXXXXXXXXXX

Thank you for your submission for an fbFund grant and support of the Facebook Platform. Our goal for this program is to encourage as many developers as possible to write innovative and engaging new applications on top of Facebook Platform. Additionally, we hope to enable an even broader class of developers to become entrepreneurs by giving you the financial resources necessary to pursue a new venture that relies on Facebook Platform.

During this process, however, it has become clear that we will receive proposals which contain similar or even identical ideas. As a result, and in order to protect other developers and us from claims that we or anyone else copied material without the creator's permission, unless we agree otherwise in writing, we can't promise that any materials or information you submit here will be kept confidential, or specifically that we or others might not develop similar or identical products or services. Accordingly, we ask that you not submit any materials or information you consider to be confidential or proprietary to this e-mail address.

This said, if you would like us to delete any materials you have just sent us, please send us an e-mail within 48 hours instructing us to do so with an email subject "DELETE", and we will delete those materials without review by anyone here. If we do not receive instructions to delete your materials within 48 hours, we will rely on that fact as indicating that you wish us to review your materials, with the understanding that we accept no obligations (whether of confidentiality, payment or otherwise) with respect to any materials, information or ideas included in your submission.

Again, we are very excited to be offering this program and wish you the best of luck whether or not you are an fbFund grant recipient. We can only give a limited number of grants and not getting one does not mean that we don't believe in your application nor that it can't be successful - it simply means that we have a limited amount of resources and weren't able to give money during this cycle to you. You are welcome to apply as many times as you like as each funding cycle represents a new opportunity to receive a grant. Additionally, there are other programs, if not ours, that can enable you as an entrepreneur to find the initial seed funding you are looking for.