City Sourced won the third runner-up to the Techcrunch50 grand prize yesterday which comes as no surprise considering that they earlier got a unanimous thumbs up fromTechcrunch50 judges Lior Zorea, Bradley Horowitz, Kevin Rose, Satish Dharmaraj and Tim O'Reilly (!) and as Sarah Lacey reports, might have a potential investment opportunity from Kevin Rose coming up.

Founded in L.A. by Jason Kiesel and Kurt Daradics at Freedom Speaks, City Sourced is a micro-volunteering crowd-sourced mobile app, like a Foursquare/ for civic problems like pot holes and graffiti.

The idea of wrangling everyday users of smart phones to make the city a better place is one of the best demonstrations of using online platforms to affect real life presented at the conference thus far.

City Sourced allows you take a photo of the specific problem (i.e. graffiti) and automatically sends the photo and location data to City Hall. What is most interesting and probably the reason Digg co-founder wants to invest is that the “noisiest complaints get bubbled to the top.” (Side note: Rose as a judge has been suggesting Digg-like features to almost every start-up that presents, leading to Techcrunch founder Mike Arrington calling him a one-trick-pony.)

law logo2x bCity Sourced is particularly useful to the denizens of Los Angeles because of the fragmented nature of our environment. This could be a boon for traffic, especially on the hellbeast we like to call the 405.

Dadarics, an L.A. native, agrees: “A pothole down the street that's really annoying, there's one off Victory and the 405, now people can use City Sourced to say 'I hate that one too.'”

Because of the positive response we might be looking at an L.A. start-up winning TC50 twice in a row (last year it was local Twitter clone, Yammer) which speaks volumes about our burgeoning start-up industry.

When asked if he had any advice for start-ups coming out of L.A. trying to compete in the Valley, Dadarics said, “It's a lot easier than you think.”

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