SocialVibe, whose parent company West Hollywood, CA-based Archetype Media raise $4.12 million from Redpoint Ventures in February, offers users a flash-based widget that they can embed anywhere that accepts flash widgets. Specifically, the company encourages users to embed them on Facebook and MySpace. The widget displays brand advertising (for brands like Coca-Cola, Nike, Sprint, or E*Trade) via logo art designed with the social networking set in mind or flash video.

In exchange for displaying the ads on their social networking profiles, users are rewarded with points. The more views or the longer an advertising badge stays up on a site, the more points users earn. Some sponsors also offer prizes for anyone who displays their ad widget. While users are earning points and prize drawing entries, a charity of their choice is earning cash. It sounds like a good deal for everyone involved, and it seems to be working pretty well -- most charities on the site have raised at least a couple of thousand dollars, and will continue to be able to do so as long as SocialVibe can demonstrate a good ROI for advertisers.

While there's something a little odd about a site that lets you endorse Nike while simultaneously raising money to fight child labor, there is a more pressing concern. SocialVibe specifically encourages users to put its advertising widgets on MySpace and Facebook, but both companies prohibit that sort of use by users in their terms of service.

• From Facebook: "You understand that except for advertising programs offered by us on the Site (e.g., Facebook Flyers, Facebook Marketplace), the Service and the Site are available for your personal, non-commercial use only."
• From MySpace: "Prohibited Content includes, but is not limited to, Content that, in the sole discretion of MySpace ... involves commercial activities and/or sales without prior written consent from MySpace such as contests, sweepstakes, barter, advertising, or pyramid schemes."

Because SocialVibe's business model relies almost exclusively on the ability for its ad widgets to be spread virally across social networks, acceptance by those networks will be crucial to its success or failure.