FEED, a Boulder, CO-based mobile payments firm, has raised $3.25 million in its first round of funding (via AC). The round came from Lacuna Venture Fund and other investors. The company is focusing on the Boulder market for now, saying it wants to build up critical mass of retailers and users. It says it has about 200 merchants currently accepting FEED mobile payments. It has a goal of having 10,000+ Boulder residents and students using Feed by the end of this year. When it goes national, it will compete against a few others like Obopay, which just raised a big $29 million round.

A video below on how the system works: