Silicon Valley's Hot New Investment: Oil and Gas

But Peter Thiel, whose Founders Fund recently led a $7 million investment an oil-related startup called RunTitle Inc., isn't your typical Silicon Valley investor. Thiel, Facebook Inc.'s first backer, is known for making contrarian bets. RunTitle is the latest in a series of oil and gas investments by his fund—even amid a slump that has seen the price of oil decline by more than half since June of last year.

RunTitle, essentially a search engine for mineral rights, compiles data on land ownership that's valuable information for oil drillers. The company's name is a play on the expression "running title," a process of digging through public records to figure out who owns what in oil-producing regions.

"The reality is that fossil fuels will continue to be the dominant source of energy for years to come," said Geoff Lewis, a partner at Founders Fund who led the investment in RunTitle. "There have been very few innovations in production." 

The San Francisco-based venture firm has also financed Tachyus, a company that sells tools to optimize oil production through data analysis; RigUp, a marketplace for oil-field services; and Modumetal, a materials company that sells to the industry. Founders Fund has also backed nuclear technology and clean energy companies.(by Eric Newcomer, Bloomberg)