Sergey, Facebook investor up to ... what?

THE PALACE HOTEL, SAN FRANCISCO — Thursday evening, Google cofounder Sergey Brin strode down the main hallway of this historic hotel. Pacing him step for step was Google executive Megan Smith, part of the team negotiating a fraught deal with Facebook. A Valleywag spy camera caught the pair heading into Maxfield's for dinner with an associate from Greylock closely involved in the firm's investment in Facebook. The meeting was hastily arranged only hours after Brin participated in Google's quarterly earnings call, with Brin rushing up to San Francisco. Why the hurry?

The obvious conclusion: Brin is reaching out to Greylock to clinch the deal. Facebook's investors have a strong say in the matter. A deal that values Facebook at $15 billion would give Greylock a nearly 30-fold return on its $25 million investment.

Greylock partner David Sze, a board observer at Facebook, encountered Brin and Smith in the hotel's hallway. While he didn't join them for dinner, he sent Eve Phillips, a Greylock associate who's leaving the firm to go startup. Also in the party: Topix CEO Chris Tolles.

It seems strange that the two would attend a dinner with such sensitive dealings in play. Unless you know that Phillips is deeply plugged into the Facebook-applications world. And Tolles, we hear, was once Smith's roommate. As trusted parties, they might have been called in to offer advice on strategy.

Complicating matters: Google and Facebook are houses divided. Word has it CEO Eric Schmidt is indifferent, if not hostile, to Google reaching a deal with Facebook. His recent comments to the Economist support that. Brin and Smith, however, are active proponents of a deal.

Facebook CEO Mark Zuckerberg's glib quip on Wednesday that the company's financing deal was "almost wrapped up" now appears optimistic, if not premature.

Google, a late entrant in the game, is offering a more complicated deal, we hear: Rather than a straight investment, it's trying to line up private equity from other investors while Google inks an arrangement to provide Facebook with advertising. That complexity may be what's dragging things out longer than Zuckerberg expected.

If this dinner is what it appears to be — a sign of continuing negotiations — then that means the game's still afoot. The Facebook deal is still in play. And Google is going all out to win it.