By: Senior staff writer – Easton Ellsworth

As Mike Arrington opined, Gnip matters – even though explaining it might make your eyelids droop.

Here’s why.

1. Funding

Not the most important item on the list, but one you can’t ignore nonetheless. Gnip has just received $3.5 million in financing to go with an initial round of $1.1 million, giving it nearly $5 million in cash in 2008 alone.

2. Business Model

Gnip Specializes in getting data between one social media service and another – e.g. LinkedIn and Twitter. With Web 2.0 in high gear, there’s bound to be a wide array of potential customers for Gnip.

3. Centralization

Gnip pulls data together into one central location where social services and content publishers can access it. This speeds up load times for everybody (assuming Gnip isn’t down) and makes data grabbing and processing simpler.

4. Simplification

Right now, dozens (if not hundreds) of tech startups are struggling to get their widgets/tools/services on everybody else’s “must-have” list. But the task of creating an API for developers to access, plus the marketing of that API, plus any other efforts to port data successfully between your service and the next guy’s, makes the whole effort complicated and costly. Gnip can step in and simplify everything so that you just pay, plug and play, so to speak.

5. Speed

Latency is everybody’s least favorite word on the Web. Gnip promises to douse it with its fast data aggregation tools.

Have you heard of Gnip before? Are you curious to try it out?