The service is a free-to-use photoblogging website on to which contributors can place one image per day, taken on that day, with the aim of telling stories through photos.
The website was developed as the personal online photo diary of Edinburgh photographer and designer Joe Tree, before being made available to other users in 2006. It now has contributors from 150 countries and receives more than 10 million page views a month from 110,000 visitors.
Tree currently runs Rocket Visuals, a web design agency, and has been operating Blipfoto on a part-time basis.
He said the cash injection would allow the site, which won a Bafta Scotland award last year, to make the leap from being a part-time operation to a full-time business. The funding is being supplied by investors including Ken Morse, founder of the MIT Entrepreneurship Centre, IT services firm Versko and the Story UK marketing agency.
The private investment is being matched by funding from Scottish Enterprise.
Tree said: "I realised very early on that Blipfoto was an idea with universal appeal, so to finally have the time, space and financial support to work towards that potential is a massive privilege. I can't even begin to describe how good it feels to have this investment in place, and how excited I am about the opportunities it presents."