"Why [HuffPo] needs $5 million in outside capital to fulfill its vision is another question."

Private Equity Week reports:

Meta blog Huffington Post, launched by talking head Ariana Huffington, is aiming to raise $5 million in venture capital-its first institutional funding round, PE Week has learned.

Huffington Post co-founder and former America Online executive Ken Lerer declined to comment on the funding, but a knowledgable source says the company has been talking to VCs and hopes to close the round by the end of summer.

HuffPo, as it is affectionately known, enjoys more than 1.3 million unique visitors monthly, according to Nielsen/Netratings. This despite the fact that most of the Hollywood stars and political heavyweights who promised to blog for Huffington stopped showing up several months after the site launched....

Why it needs $5 million in outside capital to fulfill its vision is another question. Clearly, its founders aren't hurting for money. Moreover, two weeks ago, Huffington inked an agreement with IAC/Interactive Corp., in which IAC's Advertising Solutions sales group will exclusively sell advertising for the site. Malik, who has a similar agreement with ad sales startup Federated Media, says such deals "let people focus on content and not worry about the ad stuff."

Huffington's efforts to raise outside capital may suggest that it plans to sell itself to a larger media property down the road. At least one other political blogger says he has no interest in VC because he wants to remain independent. Markos Moulitsas, founder of left-leaning political blog Daily Kos, says: "For me, outside investment is not necessary and it would make little sense for me to jeopardize the site's independence for a little more cash." He says his site is "extremely successful financially," thanks to advertisements, including one featured last week from Working America, a community affiliate of the AFL-CIO.

Yeah, I don't get it. Any ideas?

And 1.3 million visitors a month? That's not too good for them! It's half of Instapundit's traffic. And Kos... Kos has more than 10 times that. So I guess he could raise $50 million.