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The line between social networking and gaming is increasingly blurring, and internet incumbents are taking notice. NetEase, the second-largest gaming company in China (behind Tencent), is among a group of investors who just backed IMVU, an avatar-focused social network operating out of California.

Menlo Park-based Structural Capital among other institutions that also joined in the strategic round totaling $35 million. IMVU has raised more than $77 million from five rounds since it was co-founded by â€œThe Lean Startupâ€ author Eric Ries back in 2004. The company declined to disclose its post-money valuation.

The fresh investment will be used to fund IMVUâ€™s product development and comes fresh off a restructuring at the company. A new parent organization called Together Labs was formed to oversee its flagship platform IMVU, in which users can create virtual rooms and chat with strangers using custom avatars, a product thatâ€™s today considered by some a dating platform; a new service called Vcoin, which lets users buy, gift, earn and convert a digital asset from the IMVU platform into fiat; and other virtual services.

Founded in 2005, NetEase is now known for its news portal, music streaming app, education products and video games that compete with those of Tencent. It has over the years made a handful of minority investments in companies outside China, though itâ€™s not nearly as aggressive as Tencent in terms of investment pace and volume.

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