Mike Hogan of Barron’s writes:

YOU DON’T NEED CAMERON DIAZ’ LOOKS OR WARREN BUFFETT’S smarts to achieve stardom on the ‘Net. Sometimes, it just takes a good eye for picking stocks — the kind that SpecBear, TDRH and dwot possess.

Correctly calling the direction of the stocks in his virtual portfolio 83% of the time, SpecBear (a.k.a. Spectacled Bear) is numero uno in the 57,000-strong Motley Fool CAPS community (http://caps.fool.com) — at least for now. No. 2, TDRH, whose picks turn a profit just as often, trails him only because SpecBear has made more selections. Meanwhile, dwot’s 80% accuracy rating puts her 19th.

The usually anonymous bloggers (some asked Barron’s to use only pseudonyms in print) who are considered All-Stars tend to draw a crowd: More than 2,100 groupies follow SpecBear’s moves — Motley Fool groupies being other CAPS players who try to draft behind the investing expertise of All-Stars by following their portfolios and blogs, and swapping news and ideas with them. “I get lots of insights from them, too,” notes TDRH, a 40-year-old St. Louis-based sales representative named James Hill. He tracks the work of 40 other All-Stars.

Like all the investors mentioned here, TDRH has no professional investing background, but his personal portfolio has grown 6% so far this year on oil-service picks like McDermott International (ticker: MDR), versus about a 5% drop for the S&P 500 year to date. His market education began in the spring of 2006, when he first tried out his ideas on CAPS — just one of many social-investing sites.

The sites are like an electronic version of investing clubs. Their names often suggest their mission: Marketocracy (www.marketocracy.com); Tickerspy (www.tickerspy.com); Social Picks (www.socialpicks.com), whose motto is “Invest Smarter Together,” and StockPickr (www.stockpickr.com), where stars like Buffett are held up for emulation alongside community members who do the best job of emulating them. (Motley Fool’s CAPS refer to colored hats awarded based on an investor’s score of correct picks.)

There’s usually plenty of news and research to be had, personal blogs and other ways to share ideas, and electronic cubbyholes for storing your investing inputs, from e-mails to articles. Most members like to check how they’re doing frequently, so there’s an investing simulation, with a variety of benchmarks. And winning takes commitment. SpecBear had to make more than 450 picks to get his ranking; TDRH logs a couple of hours a day. Dwot (née Deborah Wotherspoon) says she regularly spends four-to-five-hour stretches researching, reading or blogging about stocks.

HERS IS A FAMILIAR STORY. A high school teacher in Canada’s Yukon Territory, Wotherspoon got tired of having professionals lose money for her. So she began building her own model portfolios in the summer of 2006, tripling her real portfolio’s value in 15 months — mostly on Canadian mining stocks — before going to cash in the market peak last autumn.

Her investing philosophy isn’t any more complicated than buying a stock she “likes,” and selling when she doesn’t “like it any more.” No charting, no fundamental analysis — just a careful shopper’s sixth sense of what’s hot and what’s not. But the four to five hours a day she spends sifting blogs and news stories don’t hurt.

Her approach is similar to that of T.J. White, whose virtual portfolios are among the most-watched on Marketocracy. Another self-made investor, White has a knack for putting obscure facts together — concluding, for example, that global warming will impact copper prices by melting the glaciers that feed the streams that feed hydroelectric plants powering Chilean copper mines. His onscreen avatar, “auminer,” reflects the days he panned for gold in the Rockies, before discovering his life’s work as a puppy-sitter in a small town near Dallas. His portfolio, he says, throws off about $100,000 a year, affording the 39-year-old a lifestyle that his passion for animals never could.

White’s secret is to focus on sectors that he understands: mining, industrial, materials and energy names that he calls “blue-collar, profitable, dividend-paying stocks.” He steers clear of tech, biotech, pharmaceuticals — anything subject to catastrophic “black swans,” like a loss of Food and Drug Administration approval. He pays a lot of attention to an issue’s net tangible asset value and price/earnings growth (or PEG) ratio, but not so much to its P/E or technical analysis, which he calls “voodoo.” While his screens carry 7,000 stocks and his 15 Marketocracy portfolios total 300 to 400 names, White rarely holds more than a few stocks. Right now, mining-giant Freeport-McMoRan (FCX) dominates.

Spurning diversification, White says, “I don’t want to put money into my sixth-worst pick.” Surprisingly, his portfolio’s beta is under 1.0, meaning it’s less risky than the Standard & Poor’s 500. His alpha is something else; White’s materials portfolio has quadrupled in value in five years.

Know your strengths and sectors also is the motto of Rajan Rajen, 36, one of the most-watched members of Tickerspy. The San Francisco-based software engineer is a prolific portfolio-builder, reports Tickerspy’s community manager, Max Magee, and Rajen’s picks consistently garner the most eyeballs due to his spade work. Rajen identifies a sector he finds interesting, then digs deep into the companies and metrics that drive it. Although he’s managing dozens of sector portfolios at any given time, he leans toward energy, commodities, materials, China and Brazil. His current favorite, Petrolio Brasileiro (PBR), has helped lift his own portfolio 5% this year.

Rajen, too, learned the old-fashioned way how markets work: by losing money, until he “got it.” His voracious reading and casting of trial portfolios led him to his key investing insight: Good stocks in bad sectors don’t do very well. The personal motivation for his hard work, besides money, of course, is to gain more insight into the world. “I just feel more comfortable in life after I’ve gotten a handle on some aspect of the market or the economy,” he says.

Validation is a big part of the payoff on social-investor sites, which seem to be multiplying. Still in beta, Bullpoo (http://bullpoo.com) promotes “connected investing.” Another new site, UpDown (www.updown.com), is building its membership by paying real dough to any virtual portfolio manager who beats the Standard & Poor’s 500 in a given month.

If a dozen heads are better than one, imagine how well thousands gathered in an electronic square can do.

Tags: Cake, Marketocracy, SocialPicks

Welcome to Issue #2 of The SocialPicks Weekly Newsletter, where we highlight some of the best content that SocialPicks has to offer.

Analysis Roundups - Bringing You the Web’s Best Stock Analysis and Market Commentary

Roundup #1: Google’s Earnings - Dispelling fears of weak paid-click growth and slowing online ad spending, Google delivered solid results. What do these results say about Google’s competitive positioning going forward? And with the stock having surged following earnings, is its current valuation justified? Analysis from Peridot Capital, WC Power Tech Fund, Piper Jaffray, Silicon Alley Insider, and 24/7 Wall Street.

Roundup #2: J.P. Morgan’s Earnings - Historically speaking, It wasn’t the best of quarters for J.P. Morgan. But given the circumstances, the market felt that it could’ve been much worse. How much will the company be affected by the credit crunch and housing market implosion in future quarters? And what doesit plan to do with the $6 billion that it’s now set to raise? Analysis from BloggingStocks, Barron’s, Merrill Lynch, and Goldman Sachs.

Roundup #3: Intel’s Earnings and the Impact on Semi Stocks - The market responded positively to Intel’s latest results, which seemed to suggest that the company’s manufacturing and R&D strengths have left it in a strong competitive position relative to AMD. Will industry fundamentals allow Intel to keep the good news coming? And what do these results tell us about some of Intel’s peers in the semiconductor industry? Analysis from Financial Joyride, Wedbush Morgan Securities, BloggingStocks, and Morgan Keegan.

Roundup #4: Johnson & Johnson’s Earnings - For a company that’s so dependent on the whims of U.S. consumers, Johnson & Johnson seems to be handling itself quite well, judging by its earnings. But to what extent can the earnings be attributed to one-time events? And can the company’s growth outlook justify its current valuation? Analysis from Seeking Alpha, The Business Word, Citigroup, and Bear Stearns.

Roundup #5: The Delta-Northwest Merger - Delta and Northwest are touting major synergies and cost-savings as a result of their proposed merger. But are there hidden costs and complications involved with this deal? And how will their competitors choose to respond? Analysis from BloggingStocks, Trader’s Narrative, 24/7 Wall Street, and Goldman Sachs.

Roundup #6: Blockbuster’s Offer for Circuit City - Blockbuster investors weren’t pleased with the company’s surprise offer for Circuit City, and a lot of analysts were left scratching their heads as well. How valuable would the synergies stemming from such a merger be? And would the move do anything to stem the competitive threats that both Blockbuster and Circuit City are facing? Analysis from Seeking Alpha, Herb Greenberg, Metue.com, Wedbush Morgan Securities, and Deutsche Bank.

Roundup #7: Solar Stocks - Off the Beaten Path - The booming solar energy industry has drawn plenty of attention from growth-stock investors. But outside of top-tier module vendors such as First Solar and Suntech, what’s the best way to play this space? Do second-tier module manufacturers such as Trina Solar and Evergreen Solar make sense? Would an ETF focused on the solar industry be a good way to approach the sector? And how about Applied Materials, which increasingly derives much of its revenues from solar panel manufacturing equipment? Analysis from Trader Mark, StreetAuthority Market Advisor, Seeking Alpha, Blogging Stocks, Credit Suisse, Goldman Sachs, and Deutsche Bank.

Roundup #8: Market and Macro Commentary - With the market having rallied, is this a good time to take some money off the table? What does GE’s surprisingly weak earnings tell us about the U.S. economy at-large? Will the credit crisis keep the U.S. dollar in a tailspin? And what kind of investing system might let investors better cope with market downturns? Analysis from The Correct Call, Vestopia, Seeking Alpha, and StraightStocks.

Tags: SocialPicks

Starting this week, our portfolio company SocialPicks is sending a newsletter of analysis roundups from the week to its userbase. Copy-pasted here for your viewing pleasure. Sign up at SocialPicks.com to get this in your Inbox every week.

Welcome to Issue #1 of The SocialPicks Weekly Newsletter, where we highlight some of the best content that SocialPicks has to offer.

Analysis Roundups - Bringing You the Web’s Best Stock Analysis and Market Commentary

Roundup #1: Wal-Mart’s Guidance Boost - This colossus of retail has managed to deliver solid results at a time when many peers are being hammered by cost-sensitive consumers. Can Wal-Mart continue to remain an exception to the rule? Analysis from Trader Mark, Goldman Sachs, The Big Picture, and TheStreet.com

Roundup #2: The Microsoft-Yahoo! Soap Opera - Will Microsoft have its way? Or will Yahoo! form a partnership or two that lets it stay independent? And what say will Yahoo! shareholders have in all of this? Analysis from BloggingStocks, The Motley Fool, Piper Jaffray, and Seeking Alpha

Roundup #3: Ford and GM - It’s been a rough few years for these auto industry giants. High oil prices and tough foreign competition have been taking a toll, and now weak consumer spending is also rearing its head. Will things get better or worse from here? Analysis from Seeking Alpha, BloggingStocks, Ockham Research, and Citigroup.

Roundup #4: Private Equity Stocks - Between a weak economy and a credit crunch, it hasn’t been the best of times for many private equity firms. But the IPO filings are still coming. Is this a good time for retail investors to buy in? Analysis from Fortune.com, 24/7 Wall Street, Seeking Alpha, and BloggingStocks.

Roundup #5: Gold! - You don’t have to be Yosemite Sam to know that gold, and gold mining stocks, have been good places to put your money over the last few years. But gold prices are still well below their all-time, inflation-adjusted highs. Will prices continue to rise, and if so, which mining stocks represent the best way to profit? Analysis from TheStockMasters, StraightStocks, Seeking Alpha, and BMO Capital.

Roundup #6: Apple and RIM - Apple’s managed to turn out one standout product after another, much to the delight of investors and its rabidly loyal customer base. But can Apple keep pleasing the market at a time when U.S. discretionary spending is weak, and European iPhone sales are beginning to look sluggish? Also, what does the iPhone’s success in the U.S. portend for RIM’s Blackberry juggernaut? Analysis from Morgan Keegan, Seeking Alpha, Thomas Weisel, Endpoint Technologies Associates, and Needham.

Roundup #7: WaMu’s Cash Infusion - Washington Mutual’s shares took off earlier this week after receiving a massive injection of cash from private equity firm TPG. This cash infusion should definitely help the company stay above water, but how good of a deal was it for shareholders? Analysis from Zacks.com; Ockham Research; Keefe, Bruyette, and Woods; and StraightStocks.

Roundup #8: AMD’s Earnings Warning - The company delivered yet another dose of bad news this weak, forecasting weak revenues and announcing major job cuts. Is the worst finally behind AMD? Or will Intel and a tough PC market environment continue to cause headaches for investors? Analysis from The StockMasters, AmTech Research, Lehman Brothers, Jim Cramer, and Canaccord Adams.

Roundup #9: Semiconductor Capital Equipment Stocks - With the semi equipment industry nearing a cyclical bottom, and the booming solar industry presenting a new growth opportunity for some firms, this might be a good time to buy into the sector. But there are plenty of different opinions on what’s the best way to do this. Analysis from Citigroup, Credit Suisse, Jim Cramer, and Zacks.com.

Roundup #10: Harley-Davidson - Like Apple, Harley has a solid brand and a devout customer base that won’t let a bad word about their favorite company go unanswered. And like Apple, some think its shares could be challenged by weak U.S. discretionary spending. But is that really the case? Analysis from Todd Sullivan, Seeking Alpha, BloggingStocks, and Stock Market Beat.

Roundup #11: Market and Macro Commentary - Has the SEC given the market false hope by rewriting some accounting rules? Will Asian economies remain immune from the U.S. economic downturn? Which sectors of the U.S. market look like safer bets than others? And does it make sense for bulls to put their money into high-beta stocks? Analysis from Barron’s, Seeking Alpha, Bespoke Investment Group, and Vestopia.

Tags: SocialPicks

TechCrunch reported that Covestor, which competes more directly with our investment Cake Financial, and less directly with our investment SocialPicks, raised money:

There are no secrets online anymore. People share everything, even the performance of their personal stock portfolios. Social investing site Covestor raised $6.5 million in a series A financing based on the appeal of this concept. The round was led by Union Square Ventures and Spark Capital. Europe’s Amadeus Capital Partners also participated. The startup previously raised $1 million last June from the founders of Seekingalpha, Betfair, Tribe.net, and Wallstrip.

Covestor, which is still in beta, lets you link your real brokerage account to the service so that you can compare your returns against other Covestor members, professional fund managers, and the overall market. As I wrote last October:

The idea is that eventually, the best investors will emerge, and Covestor plans on creating ways to invest in their “funds.” They are actually just going to be selling the data and linking it to the brokerage accounts of people who choose to be followers. The investing stars who arise from this social soup will be able to offer their trading data for a fee once they build a track record or give it away for free and enjoy the notoriety of being an investing whiz. Covestor will take its cut as a management fee.

Covestor competes with Cake Financial—which also lets you link to your real brokerage account and tracks more than $1 billion worth of investments—SocialPicks, and Motley FoolCaps. Covestor won’t disclose the total value of the funds it tracks, but last October it was $100 million. Presumably, it is now much higher.

Tags: Cake, SocialPicks

VentureBeat covers Covestor’s $6.5M raise:

Well known venture capitalist and blogger Fred Wilson, who happens to be an investor in Covestor through his firm Union Square Ventures, writes that social platforms such as Covestor “might be the best option for investors looking to generate outperformance in the market.” He shares his stock portfolio performance (not good; see left).

While Wilson has put his proverbial money where his mouth is, whether Covestor can separate from the growing field of social investment sites including Zecco and Cake Financial remains to be seen. Back in February, we made up a list of 11 contenders for the social investing market.

Tags: Cake, SocialPicks

We’ve seen social editing, social networking, social news, social bookmarking, and even social music take off. Now a social shock to the system is coming to a market usually dominated by insiders and experts: the finance industry.

Online trading brokerages have existed since E*Trade pioneered the market in the early ’90s, but now an onslaught of entrepreneurs, new media experts, and financial analysts are once again rebelling against the traditional investing model on Wall Street. They want to open the valves of information to those of us who aren’t experts.

It’s a potentially lucrative field, and a number of key players were strutting their stuff at the O’Reilly Money:Tech conference in New York City last week.

Inspired by that conference, this survey of the space compares the main players and outlines their user bases and business models. And while I won’t answer the question of whether you can and should trust your money to the ‘crowd wisdom’ model, I’ll try to answer questions that are quantifiable: who are these companies, how much money did they raise, and how do they plan to make money?

Covestor is a social investing community that links your online portfolio to a real brokerage account, analyzes the data, and lets users follow investors (who Covestor calls “fund managers”).

Covester caters to two types of users: investors and fund managers. Fund managers — who may be anything from professinal investors (who make up 20 percent of the site) to hobby investors — import data from their actual real-life portfolios (from any of 18 online stock brokerages) onto the site so that other users can watch their investments. Covestor performs analytics on each of the fund managers. Investors can then browse fund managers by type of investments that a manager makes and how risky those investments tend to be.

Covestor’s analytics creates tables comparing 150 different dimensions that investors can search. Investors can also track their performance and activity against other users, fund managers, and indices and can recieve email updates when a fund manager they follow makes a change to his or her portfolio.

CEO Richard Tahta says Covestor plans to bring a level of trust and real-world verification to social investing, like what you find on social network Facebook. He says he plans to extend the site to let users follow fund manager activity in real time and allow buy/sell orders to be sent directly to a user’s brokerage account. In that sense, Tahta’s goal is to compete with portfolio management services from UBS or Goldman Sachs. (Note: Covestor’s operations chief previously ran the data and portfolio analysis systems at Goldman Sachs.)

To take care of users’ research needs, Covestor has partnered with financial news sites Seeking Alpha and Investopedia, as well as a major financial content provider that Tahta declined to name. Although its current audience is mainly U.S.-based, Covestor has users in more than 30 countries. It only analyzes trades in long, short and equity markets, and doesn’t allow trades on options or derivatives.

Right now, Covestor doesn’t have any revenue, but it plans to let fund managers earn revenue by charging minimal fees to the investors who follow them, just as real fund and hedge fund managers do, while the company will keep a portion for itself.

The company has received two rounds of funding from undisclosed investors.

Location: London, UK and New York City
Number of employees: Undisclosed
Funding: Undisclosed funding from Independent News and Media PLC
Business Model: Company takes percentage of fees that fund managers earn from other users
Profitable: No
Money invested through platform: $1 Billion, according to Tahta.

Steve Carpenter, chief executive of Cake Financial (who we covered at launch in September), wants his company to become the largest social network for investing. The idea is to let users who own the same stock talk about their common investments. In fact, the company has a stealth application in development that may hit a major social network soon.

Cake not only lets users import data from multiple brokerage accounts, but also gives users access to historical portfolio data and lets them view historical returns on investment from that data — something most brokerage accounts won’t do, Carpenter says. Cake then ranks users and lets other users follow their future investments. Cake’s top users feature an annual historical return of 28 percent, dating back to 2002.

To make money, Cake plans to sell the habits of its top users to institutional investors, who, Carpenter says, have already approached him. All the information on the specific value of portfolios and the number of shares is confidential because Cake’s metrics are based on percentages of stock portfolios, not the number of shares owned. Cake also shows the impact a certain stock has had on the overall value of the portfolio. Carpenter adamantly maintains that each users’ data is his or her own, not the bank’s or brokerage firm’s.

Carpenter compared Cake to social music site Last.Fm, specifically mirroring its clean user interface, good customer experience, and ranking individual data to provide personal recommendations, something the company will begin in 2008. It also provides activity alerts to alert users of changes in the portfolios of friends, family, and other investors they’re following.

In one week, the company’s going a whole lot more social — we’ll let you in on the development when it happens.

Location: San Francisco
Number of employees: 20
Funding: Undisclosed amount from investors who include Alsop Louie Partners, Ron Conway/Baseline Ventures and others
Business Model: Sell data on top users to institutional investors.
Profitable: N/A
Money invested through platform: Undisclosed

Zecco stands for zero commission costs. In accordance with that name, Zecco lets investors with $2,500 in their account make ten free stock trades per month.

CEO Jeroen Veth, a former Merill Lynch Vice President, says the industry is headed towards a more open flow of information, something we saw discussed often at the Money:Tech conference. The company is focused on customer service after numerous complaints in its first launch, and has nabbed an E*Trade employee, Michael Feser, the guy who helped run E*Trade’s customer service turn-around.

Zecco will be profitable later in 2008, says Veth, and is already generating revenue from multiple sources — interest earned on account balances of its members, charges from special services, advertising, and cross-selling products with other financial-minded institutions. Zecco has talked to some European companies about expanding internationally by franchising its model, but Veth wouldn’t offer any specifics.

Veth cites both Cake Financial and Covestor as companies hovering in the same market space, but he argues that there’s room for different players, just as E*Trade coexisted (and still does) with TD Ameritrade. If anything, Veth says, the competition proves that the shared vision of an open, social-influenced investing community is gaining traction.

Zecco launched late 2006. In November last year, we wrote about the company’s extraordinary growth plans.

Location: Burlingame, Calif. and previously Ontario, Canada
Number of employees: 85
Funding: $35 million, including Skype investor Martin Lund
Business Model: Advertising, Cross-selling products, interest on account balances, franchising Zecco model
Profitable: In 2008
Money invested through platform: N/A

Wikinvest, a site we covered in November, brings the seemingly antiquated wiki collaboration approach to the arena of investing. The San Fransisco company lets investors collaborate by editing pages about stocks and other opportunities. Already the site claims 100,000 contributors to its wiki.

Wikinvest lets you start with concepts, which the company explains can be things like themes, ideas, trends, products, and industries. Not only can investors do a typical search by company name, but they can also start searching from concepts like the rising price of oil, crisis in subprime lending, or the rise of ecommerce, the site explains.

One component unique to Wikiinvest is a social stock chart, or WikiChart, which lets users add annotations to try to explain WHY a stock price is fluctuating.

You can even play a popular game that’s reminscent of time spent on Wikipedia: something the company calls “six degrees of Exxon Mobil.” Here’s what the company says: “Sometimes in the office, we play Six Degrees of Exxon Mobil — a little game we made up in which we try to guess the shortest way to link any company to Exxon Mobil. The other day we were talking about Coca-Cola: From Coca Cola (KO), click through to Corn Prices, which is connected to Ethanol, which is connected to Oil Prices, which is connected to Exxon Mobil (XOM).”

Location: San Francisco
Number of employees: N/A
Funding: $2.5 million from DCM
Business Model: N/A
Profitable: N/A
Money invested through platform: N/A

Marketocracy is yet another social investing site that lets investors import virtual mirrors of their real stock trading portfolio. It gives individual managers a report card and lets users invest money along with the best performers.

A year ago, Marketocracy opened four virtual funds made up of the stock picks by the top four of Marketocracy’s 80,000 participating managers. Marketocracy tracked their records over the past five years, giving them a virtual $1 million to invest and factoring in transaction fees and other costs. Their long-term goal was always a m100 fund that demonstrates the site’s best investors.

Today, the site claims more than 55,000 users managing 65,000 model portfolios, which Marketocracy has been tracking and analyzing for three years, incorporating long and short-term performance. The company supposedly accounts for the market, sector, and style of trade, of its investors to help offset the “right place, right time” factor that many investors criticize social investing sites for.

Marketocracy was cofounded by Chief Executive Ken Kam and President Mark Taguchi, who managed a fund called the Firsthand Technology Value Fund, ranked No. 1 fund by Lipper for five years.

Location: San Mateo, Calif.
Number of employees: N/A
Funding: $16 million from US Venture Partners, Formative Investors, and others
Business Model: N/A
Profitable: N/A
Money invested through platform: N/A

The Motley Fool CAPS is a fantasy stock investing game that lets users forecast a stock’s performance vs. the S&P 500. Based on that performance, a user gets a percentile ranking. CAPS then uses the data to sell stock recommendations.

CAPS has a digg-like super user feature, where users with higher ratings have more sway on a stock recommendation. It also gives users the ability to vote per stock on bull vs. bear predictions, provides discussion boards, and lists general statistics on the stock in question.

Stock ratings are based primarily on three factors: predictions that a pick will outperform or underperform, time frames for those picks, and ratings of users who made those picks. CAPS claims that these ratings are all merit-based, held accountable by the thousands of users.

The site even tracks the famed Jim Cramer, from CNBC’s TheStreet.com, who is currently ranked 8,050 out of 44,685 using the picks he recommends on his TV show.

Location: Alexandria, Virg.
Number of employees: part of Motley Fool, so hard to count
Funding: Division of Motley Fool
Business Model: Sells stock recommendations and advertisements
Profitable: N/A
Money invested through platform: Only fantasy funds

(The logo’s a bit reminiscent of Covestor’s, isn’t it?)

SocialPicks is another fantasy stock-market investment game gone social. In fantasy sports fashion, users pick the companies they’re pulling for — or at least expect to perform well on the market, and get a score based on how well they return money from their “picks.” These picks are ranked against other users, while the web site also features a financial blog submission tool that extracts opinions on stocks from various users’ blogs.

Like some of the other sites, SocialPicks wants to generate revenue based on the value of the financial data of its users.

Location: Mountain View, Calif.
Number of employees: N/A
Funding: $500k from Bay Partners
Business Model: Sell data
Profitable: N/A
Money invested through platform: Fantasy funds only

Stockpickr is an investing site founded by two hedge-fund managers frustrated with the standard investment approach.

James Altucher and Dan Kelly created a site where users could not only follow “super investor” portfolios like those of a George Soros or Warren Buffet, but also pick one or two positions from each of those. Joining with TheStreet.com (which first owned 49.9 percent of the site and then later bought it out completely), Stockpickr was built to function like financial news with the news stripped out, according to Altucher.

Stockpickr, which claims five million unique visitors, also features portfolios from its community of users, which other users may rate. The big draw to the site, however, seems to be its “answers” sections, which functions a bit like Yahoo Answers but for stocks. It also displays most viewed portfolios, top rated portfolios, and a TV section, which shows video from not only TheStreet.com, but also user-generated video.

Location: Wall Street
Number of employees: Part of TheStreet.com, so hard to count
Funding: Undisclosed acquisition by theStreet.com
Business Model: Advertising
Profitable: N/A
Money invested through platform: None

San Francisco-based Vestopia lets users follow professional money managers on its social investing site and receive email or SMS updates when the managers a user is following makes a trade.

VentureBeat writer Anthony Ha covered the company a few days ago and explained: “Vestopia offers information about fewer investors, but says its information is more credible, because it tracks real individuals and can show you exactly how they’ve done over time. You can judge for yourself by reading their profiles here. The three most successful investors, according to Vestopia’s statistics, are Dan Knight of DK Investments, independent trader Larry Gendler and Mike Goodson of JP Morgan.

“Vestopia offers other ways to interact with the ‘investment managers’, such as blogs, videos and live chats. But since there’s no shortage of investment advice on the Web, the portfolio tracking is the heart of Vestopia’s approach.

“In addition to launching its service, Vestopia also recently announced that Steve Markowitz, co-founder of shopping rewards site MyPoints.com, is its new CEO. The company says it raised “millions of dollars” — it won’t disclose exactly how much — in January from Lightspeed Venture Partners, Gemini Israel Funds and Ofer Hi-Tech.”

Location: San Fransisco
Number of employees: N/A
Funding: “Millions of dollars” from Lightspeed Venture Partners, Gemini Israel Funds, and Ofer Hi-Tech
Business Model: Plans to begin charging for “premium services”
Profitable: N/A
Money invested through platform: N/A

Investing social network The UpDown was created by a bunch of Harvard Business School alums who wanted to build a site for users to out-trade (and get paid when they do) the major stock indices using $1 million in fantasy money — and use that data to run a multi-billion dollar fund consistently outperforming the market. Users also improve investment skills through collaboration, using the site’s social networking features.

The company, which launched in September 2007, is already claiming more than 17,000 registered users.

VentureBeat’s Leonid Kozhukh explained when he covered the company back in December: “The company’s ultimate goal, says co-founder Michael Reich, is to build up a group of users who consistently out-perform the major indices and then create an investment vehicle that mimics the behavior of those users. The challenge is to pinpoint a subset of users whose investment behavior is both trustworthy and scalable to large investments. (A corporation’s liquidity and market valuation may be problematic at higher investment amounts.) Reich is optimistic that by cultivating the right mix of online members, he’ll have the data he needs to run a multi-billion dollar fund capable of outdoing the markets.”

Location: Cambridge, Mass.
Number of employees: 3
Funding: $1.2 million from Swiss Investor Joachim Schoss
Business Model: Advertising
Profitable: N/A
Money invested through platform: Roughly $18 million in fantasy funds.

BullPoo, another social investment platform with a much more interesting name (and a video-game twist), lets users discuss and debate financial issues as well as trade a virtual portfolio, make forecasts, and post financial blogs. Bullpoo analyzes and posts statistics on user forecasts and portfolio management. BullPoo even has fictional brokerages that users can pick from based on investment style and preference.

The site also has the typical community features: top rankings, feedback and profile creation, but most viewable features are closed to registered users. For the forecasting feature, users set target price, duration, and precision of the forecast, while Bullpoo tracks the success of those forecasts.

Users can invest their $1 million play money into the American stock exchanges, but the site also has a role playing game-like scoring system, that lets users earn experience points for their trades and forecasts to advance to the next level. It may not compare to Final Fantasy or World of Warcraft in terms of a following, but Bullpoo is trying to make investing more fun for its users.

Location: Ontario, Canada
Number of employees: N/A
Funding: N/A
Business Model: Advertising
Profitable: N/A
Money invested through platform: $1 million in fantasy funds

– VentureBeat

Tags: Cake, Marketocracy, SocialPicks