Just when you thought the world couldn’t handle any more social networking sites, along comes a company called Red Room.

The site is designed for authors looking to promote their work and engage their readers and has already managed to raise $1.25 million and attract the likes of Maya Angelou, Salman Rushdie, and Amy Tan. Red Herring first reported about the funding.

While Facebook, MySpace and their ilk get most of the press, niche social networks are gaining ground. In May, Buzznet, which connects indie music fans with the bands they love, raised $6 million and says it has more than 8 million users. Last June, Daily Strength, a social network for people with health problems, took in $5-7 million and claims to be growing rapidly.

Red Room is part of this trend, and it seems well positioned to exploit its niche because it’s giving a community without much tech savvy an easy way to start marketing itself. Instead of having to create and manage their own websites, authors can go to Red Room and post blogs, podcasts, and tour dates. They can communicate with readers and move out of the ivory tower and into a potentially highly engaged community of fans and fellow writers. One nice feature allows authors to dictate which booksellers their pages link to.

The San Francisco-based company says it intends to branch out from high profile celebrities and attract aspiring authors and book clubs as well.

It has raised $1.25 million over the course of two angel rounds from investors that include Craigslist’s Craig Newmark.