US venture capital firm Bay Partners has launched AppFactory, a program that will invest in developers creating applications for the Facebook platform.

The FT reports that Bay Partners is looking to make up to 50 investments of between $25,000 to $250,000 (£12,000 to £120,000) to help developers build Facebook applications.

Facebook’s decision to open up to developers in May this year has proved to be a popular move. Since then, 1,600 applications have been launched for the social network, with many more planned.

A market has developed for Facebook applications – recently acquired Favorite Peeps, a Facebook app with 1.3m users, for $60,000, with travel company SideStep also buying Extended Info.

These widgets offer a way to access an audience of millions on the rapidly growing site, as the top 25 Facebook applications reach a combined total of 55m users.

According to Salil Deshpande of Bay Partners:

“Historically, the creation of an operating system, or a platform, has always led to a new economy, which includes a marketplace of applications that are optimally designed for that platform and its user base. Bay wants to find the killer apps, whatever they may be, and with the AppFactory, we will help entrepreneurs discover, build, and monetize them.”

Some 40,000 developers have signed up with Facebook since this launched.

It’s starting to look a little like Facebook has gone of the scale. Yahoo knows it, Mr Murdoch knows it, and you can be sure Google is well aware of it too.

Further reading:

Facebook preparing for mega IPO? Probably…