It’s so interesting how many social networks, struggling to monetise what they do while trying to scale (Facebook natch) almost always miss virtual goods and digital gifting as a model (an exception to this rule is Flirtomatic).

So I guess if they won’t do it other will do it for them. Thus, it’s interesting to see that London-based TagText Tagtext has secured £1 million funding in a deal led by Newcastle-based venture capital firm, NorthStar Equity Investors (NSEI). TagText has a messaging product that allows young people to send animated avatars to their friends via social networks, and of course, mobile.

Notably, Russell Buckley of Mobhappy.com and founder of AdMob was an early investor in the company. He likes the “platform-agnostic, personalised and expressive messaging” aspects. TagText is currently undergoing user trials, and beta testing prior to launch.