But the current market tempts VCs to change the game plan by buying shares of late-stage Web companies wherever they can find them–from start-ups directly or from employees and previous investors.

VCs didn’t start the fire; folks like Yuri Milner from Digital Sky Technologies (Facebook, Zynga, Groupon) and private company marketplaces that help stave off IPOs, like SecondMarket and SharesPost, did.

But these new Web giants’ valuations just keep going up. Think Facebook’s valuation was bloated at $50 billion? After seeing huge demand at that price, a month later, the company is exploring selling employee shares at a $60 billion valuation.

Watching those numbers rise so quickly makes VCs lose their hang-ups about price and just want to get in on the hotness.

Kleiner Perkins is reportedly buying $38 million worth of Facebook shares from existing shareholders at a $52 billion valuation, according to VentureWire. Meanwhile, Andreessen Horowitz bought $80 million worth of Twitter shares on the secondary market, after not participating in the company’s recent $200 million funding round, led by Kleiner Perkins.

Both those firms, along with Battery Ventures and Greylock Partners, also invested in Groupon’s last huge round, after the daily deal site walked away from talks of a $6 billion buyout by Google.

It’s not just the big names doing such deals. Venture capitalists were the buyers in more than 40 percent of transactions on SecondMarket in the fourth quarter of 2011.

VC activity easily outpaced other buyers, which were individuals, hedge funds, mutual funds, secondary funds and asset managers.

According to SecondMarket Head of Public Affairs Mark Murphy, VCs representing the largest percentage of buyers is a recent trend that started in the third quarter of 2010.

This comes at a time when raising money for a VC firm is tougher than ever.

What are VCs buying on SecondMarket? Facebook accounts for the single largest portion of transactions, at 39 percent. After that are LinkedIn, Etsy, Chegg, Epocrates, Silver Spring Networks, CafePress and Reply, and some other companies that declined to be named.

SecondMarket does not share pricing or volume stats or trends, except to say it sold $157.8 million worth of stock in the fourth quarter, up from $75 million in the third quarter.

Some VCs are steering clear of secondary markets and late-stage deals. Redpoint’s Geoff Yang was willing to go on the record about it in a recent interview. “What do venture capitalists know about being a momentum hedge fund?” he said.

It’s not just proven hits big enough for the secondary markets that are attracting funding interest. Everyone is still eager to find the next Groupon or Zynga. The Q&A site Quora, led by former Facebook CTO Adam D’Angelo, raised $11 million at a valuation of $86 million last year before it had even launched to the public. After success with early adopters, the start-up is now fending off offers of much more money than that.

So there’s pressure to either get in very early, or get in late if you can, because the time in between is fleeting.

VCs are also actively trying to get more involved in seed funding deals. For instance, Google Ventures recently set up its Startup Lab to attract early-stage companies where it charges them $5 per month for office space (see our video tour). And just this morning, NetworkEffect covered how VCs are actually more active than angels on the early-stage investment matchmaking service AngelList.

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On Friday, Apple (AAPL) is launching a second-generation iPhone, called the iPhone 3G, which addresses both of those problems, while retaining the look and feel of the first model’s hardware and software.

The base version of the new iPhone costs $199 — half the $399 price of its predecessor; the higher-capacity version is now $299, down from $499. Yet, this new iPhone is much, much faster at fetching data over cellphone networks because it uses a speedy cellular technology called 3G. And it now sports a GPS chip for better location sensing.

The company also is rolling out the second generation of its iPhone operating system, with some nice new features, including wireless synchronization with corporate email, calendars and address books. And there’s a new online store for third-party iPhone programs that Apple hopes will make the device usable for a wider variety of tasks, including gaming and productivity applications. This new software and store will also be available on older iPhones, through a free upgrade.

I’ve been testing the iPhone 3G for a couple of weeks, and have found that it mostly keeps its promises. In particular, I found that doing email and surfing the Internet typically was between three and five times as fast using AT&T’s 3G network as it was with the older AT&T network to which the first iPhone was limited.

Apple’s new iPhone operating system includes an ‘App store,’ where you can browse for, and download, third-party software.

The iPhone 3G is hardly the first phone to run on 3G networks, and it still costs more than some of its competitors. But overall, I found it to be a more capable version of an already excellent device. And now that it’s open to third-party programs, the iPhone has a chance to become a true computing platform with wide versatility.

There are two big hidden costs to the new iPhone’s faster speed and lower price tag. First, in my tests, the iPhone 3G’s battery was drained much more quickly in a typical day of use than the battery on the original iPhone, due to the higher power demands of 3G networks. This is an especially significant problem because, unlike most other smart phones, the iPhone has a sealed battery that can’t be replaced with a spare.

Second, Apple’s exclusive carrier in the U.S., AT&T Inc. (T), has effectively negated the iPhone’s up-front price cut by jacking up its monthly fee for unlimited data use by $10. Over the course of the two-year contract you must sign to get the lower hardware prices, that adds $240, overwhelming the $200 savings on the phone itself. If you want text messaging, the cost rises further. With the first iPhone, 200 text messages a month came free. Now, 200 messages will cost $5 a month, or another $120 over the two-year contract.

The iPhone 3G still has a couple of features that made the first version unpalatable to some potential buyers. It uses a virtual on-screen keyboard instead of a physical one. While I find the virtual keyboard easy and accurate, not everyone does. Also, in the U.S. and in many other countries, the iPhone is still tied to a single exclusive carrier, whose coverage or rate plans may be unacceptable to some.

Here is a rundown of the changes in the new model.

Design: The new iPhone looks almost exactly like the old one. It is the same length and width, has the same big, vivid screen, and has the same number and layout of buttons. The main difference is the back, which is now plastic instead of mostly metal and curved instead of flat. It’s very slightly thicker in the middle, with tapered edges, and weighs a tiny bit less.

The new iPhone 3G (left) delivers much higher Internet download speeds over cellular networks than the original iPhone (right).

Like its predecessor, the iPhone 3G comes in two models distinguished only by storage capacity: 8 gigabytes and 16 gigabytes. The top model is available in black or white.

Apple has greatly improved the audio on the new iPhone. I found the speaker was much louder, for music and for the speakerphone. But the new phone produced an echo when used with the built-in Bluetooth system in my car. Also, the headphone jack is now flush with the case instead of recessed as on the first model, so it can accept any standard stereo earphones.

The camera, however, is still bare-bones. It can’t record video and has a resolution of just two megapixels. The power adapter is now tiny, at least in the U.S., but Apple no longer includes a dock for charging, just a cable.

Software: The basic software is similar. The biggest addition for some users will be full compatibility with Microsoft’s (MSFT) widely used Exchange ActiveSync service, which many corporations use. In my tests, I was able to connect the iPhone 3G to my company’s Exchange servers in a few minutes, and my corporate email, calendar and contacts were replicated on the phone. Any changes I made on the iPhone were reflected almost instantly in Microsoft Outlook on my company PC, and vice versa. Email was pushed to the phone as soon as it was received on the company’s servers.

One drawback: While you can have both personal and Exchange email accounts on the new iPhone, if you synchronize with Exchange calendars and contacts, your personal calendar and contacts are erased.

The new iPhone and upgraded older iPhones also will be able to use a new Apple consumer service, MobileMe, which offers synchronized push email, calendars, photos and contacts.

There are other improvements. You can now delete multiple emails at once, set parental controls and search your contacts. You can also save photos in emails or from Web sites. You can also now open Microsoft PowerPoint files sent as attachments, though I found in my tests that opening larger PowerPoint files crashed the phone.

Some software features missing from the first iPhone are still AWOL on the new one. There’s no copy and paste function, no universal search, no instant messaging and no MMS for sending photos quickly between phones.

Network: Like the old iPhone, the new one can perform Internet tasks using either Wi-Fi wireless networking or the cellphone networks. But the addition of 3G cellular capability makes the new model more useful for Web surfing, email and other data tasks when you’re not in Wi-Fi range. In my tests, in Washington and New York, I got data speeds mostly ranging between 200 and 500 kilobits per second. By comparison, the original iPhone, tested in the same spots at the same time, mostly got cellular data speeds between 70 and 150 kbps on AT&T’s old EDGE network. The new iPhone typically was between three and five times as fast as the old one.

While AT&T now has 3G networks in 280 U.S. cities, and aims to be in 350 by year end, it is converting its cellphone towers gradually, so not all areas of included cities have 3G coverage. The new iPhone falls back to EDGE speeds when 3G isn’t present.

One side benefit to 3G is that in some areas, voice coverage improves. At my neighborhood shopping center, where the first iPhone got little or no AT&T service, the iPhone 3G registered strong coverage. But I still found that calls regularly broke up on some major streets. In New York City, riding in a taxi along the Hudson, one important call was dropped three times on the new iPhone. Finally, I borrowed a cheap Verizon (VZ) phone and got perfect reception.

Battery life: Apple claims that over 3G, the new iPhone can get five hours of talk time, or five hours of Internet use. Talk time is twice as long on the older EDGE network, and Internet time is an hour better with Wi-Fi.

I ran my own battery tests using the phone’s 3G capability. Although I left the Wi-Fi function on, I didn’t connect it to a network, so the phone had to rely on 3G. In my test of voice calling, I got 4 hours and 27 minutes, short of Apple’s maximum claim and nearly three hours less than what I recorded in the same test last year on the original iPhone. In my test of Internet use over 3G, I got 5 hours and 49 minutes, better than Apple’s claim, but far short of the nine hours I got using Wi-Fi in last year’s tests.

More important, in daily use, I found the battery indicator on the new 3G model slipping below 20% by early afternoon or midafternoon on some days, and it entirely ran out of juice on one day. I overcame this problem by learning to use Wi-Fi instead of 3G whenever possible, turning down the screen brightness and even turning off 3G altogether, which the phone permits.

The iPhone 3G’s battery life is comparable to, or better than, that of some other 3G competitors. But they have replaceable batteries. The iPhone doesn’t.

Third-party software: If things go as Apple hopes, third-party software could be the biggest attraction to the new iPhone 3G, and to upgraded older iPhones. By some estimates, there will be hundreds of these programs, some free and some paid, almost immediately.

Apple didn’t supply me with programs for testing, but I managed to try several on older devices upgraded to the new operating system. I tested a game that used the phone’s motion sensors to control the action, and I tested several programs from America Online (TWX), including AOL Instant Messenger; AOL Radio, which streams music from the Internet; and AOL’s Truveo video search engine. All worked very well.

Among the programs Apple has publicly previewed were a sales automation program from Salesforce.com, a game called Super Monkey Ball from Sega and a program for bidding on eBay (EBAY). Also made public were a news reader from the Associated Press, a program for following live games from Major League Baseball and several programs for doctors, including the Epocrates drug reference.

Bottom line: If you’ve been waiting to buy an iPhone until it dropped in price, or ran on faster cell networks, you might want to take the plunge, if you can live with the higher service costs and the weaker battery life. The same goes for those with existing iPhones who love the device but crave faster cellular data speeds. But if you already own an iPhone, and can usually use Wi-Fi for data, you probably should hold off and get the free software upgrade before deciding whether it’s worth getting the new hardware.

Find all of Walt Mossberg’s columns and videos online, free, at the All Things Digital Web site, walt.allthingsd.com. Email him at mossberg@wsj.com.