Israel Innovation 2.0

Inside Israeli Technology

This week’s edition of “Company Briefs” is inspired by BloggingStocks’ Zack Miller’s post, “Two Stocks to buy before Tuesday’s Annapolis peace conference,” and JobMob’s Jacob Share’s post, “67 Lists of Life Tips.” When you’re finished with these 23 headlines, you can also check out Eze Vidra’s VC Cafe post, “Bitesize: A Low Calorie News Dose.”

During the week of November 26th, the usual media attention allotted to Israeli technology was dwarfed by the attention the Annapolis peace summit received. Here’s 23 headlines of news stories related to the Israeli high-tech sector that you may have missed that can a significant impact on the Israeli industry, including investment, in the near future.

Cleantech:

By 2020, fuel oil and diesel won’t be used in Israel

Transforming the air we breathe into the water we drink

New proposals for competitive energy market

Ben-Eliezer commits to 10% clean energy by 2020
Ampal, Clal to develop wind projects

Investments, expansions and M&A:

Ness Tech in expansion mode in India

Diagnostic co Quantomix bought by El-Mul

InSightec raises further $30 million

Jerusalem Global to raise new VC find

RBC prepares shopping list of Israeli high-tech

Taiwanese invest in Israeli sensor startup

Skin treatment co HealOr raises $8 million

Ness Technologies buys Hungarian firm

Everything else:

Voltaire ranked as fastest-growing tech company by Deloitte

Israel pushing hard on nanotechnology R&D

UK and Israel have fastest growing tech firms in EMEA

Israeli firm enables voice, video messages

HP Israel wins Pele-Phone contract

Glide Mobile brings advanced online mobile computing to Israel

Israel, Korea to fund more R&D

Over 209,000 Israelis are Facebook members

Global industry:

New method for making diesel fuel uses vegetable oils


Google’s next frontier: renewable energy

Tim Berners-Lee, the father of the World Wide Web, recently mentioned in his blog that social networking on the Web is providing people with the opportunity to share data about themselves and things related to them for the interest of others (i.e., for connecting to others). He explains though that the popularity of these social networks hide the reality of people using these closed sites not for the sites themselves but for the opportunities and connections that they provide them.

For those who aren’t familiar with Israeli society, it tends to pride itself on giving advice and having connections (protexia). The connection of people and information are strong values that are practically innate in Israelis and has probably contributed to Israel’s high-tech sector being very active in the Web 2.0 phenomena — so active, that I have been thinking ever since Daniel Cohen’s Israei Nokia article that if all these Israeli companies were pooled, Israel could have countered Google or created its own Facebook.

Unfortunately, it’s a lot easier said than done or even fully imagined. However, with Berners-Lee talking about the Giant Global Graph and the need to transcend the limits of the current social networking graph, maybe there is still the chance that Israel will build the next big networking phenomena. Israeli companies just have to think outside the box of the Web and the set up of social networks as we know it.

For anyone who wants to get started on this, here’s a list of some of the top Israeli Web 2.0 companies that offer interactive services that if were combined in a new way, I think could create the next big thing:

Fun:
Aniboom– Users can create animated clips, post clips, view clips here, and based on the popularity of content that you post, you have the chance to make some money as well.

Metacafe– A user-driven video-sharing site that shows only entertaining short clips that is first reviewed by users before it gets posted on the site. Program creators of the most popular content get paid.

BlogTV– For anyone who has something to share via video. This gives you the chance to create your own live channel on anything you want.

Search and Information:
Walla!– An Internet portal with free email for anyone, this is the first stop for local information and direction on the Web.

Answers.com– Formerly with the tag line, the encyclodictionalmanacapedia, Answers.com is a one stop information engine. It’s popular wikiAnswers allows users to post and answer questions on anything they might be wondering.

Collaboration and work environment:
eSnips– While it is great for its music features, eSnips’ 5GB storage gives users a way to easily store and share documents on the Web.

ooVoo– 6-way video conferences, video messaging and video chatrooms make this ideal for live video communication for business or for fun.

Verix– Offers solutions for Business Intelligence when it comes to sales.

Advertising:
Kontera– “Kontera is a leading provider of In-Text Advertising and Information Services based on patent- pending text and content analysis technology that maximizes relevancy and yield for online users, publishers, and advertisers.”

TVinci – “The TVinci media management platform helps video content owners, broadcasting channels and publishers enrich, socialize and personalize video content, while maximizing monetization.”


Hiro Media
– Hiro’s ad-supported video downloading technology allows any video distributor to allow the unlimited sharing of its product over the Internet with the ability to monetize it. monetized.

Globes is reporting that Gilon Business Insight Ltd., “a subsidiary of Dovrat Group unit D-Partners, has acquired Tachlit Database Marketing for an estimated $1 million.” The move, which will “complement [Gilon’s] own business intelligence activity,” provides additional assurance that the company will continue to dominate Israel’s business intelligence market.

Here’s a list of some of Gilon’s partner Israeli BI software companies that benefit from Gilon recommendations to its customers:

YaData– Its software solutions helps Direct Marketers with discovering and managing micro-segments in target marketing.

Hiposoft – Its SAP solutions, especially BSignal, supplements SAP environments by immediately alerting the company to any unusual activity within the system, all with the option of doing so in a Web 2.0 way.

Verix – Its Verix Discovery Suite is intended to make the task of business analytics more efficient for sales teams by automatically “discovering emerging changes in purchasing behaviors” and “giving them the information they need to plan and schedule calls so they can influence the outcome.”

News
An article in the New York Times last week pointed out the failures of the mobile web in attracting more users over the years. Recently though, several companies and initiatives, including Israeli-based InfoGin Ltd., have been created to drive more people to use the mobile web and to improve the mobile web experience.

Background
InfoGin was founded in 2000 by Eran Wyler after he foresaw the “need for surfing the real Internet on any mobile device.” Over the years, InfoGin has become a leader in “Web-to-mobile content adaptation, enabling mobile users to access any Web site they desire, optimized to their mobile device.” According to a company description,

“InfoGin’s patented technology offers a range of solutions, from a fully automatic intelligent conversion engine to professional content-editing and marketing tools that enable full control over the delivered information.”

The company’s most recent technology is the Internet Mobile Platform (IMP) that is currently being implemented by several major companies, from Virgin Mobile (UK) to MapQuest.

Major Customers
Virgin Mobile (UK)
Cellcom & Pelephone (Israel)
AOL
MapQuest
InfoSpace

Analysis
Despite the increasing popularity of mobile phones with Internet access and various initiatives, the mobile web is a mess. Very few users pay for data services in their cell phone plans and those who do, are faced with difficult navigation tasks and limited data available to them.

The recent popularity of Apple’s iPhone and the Google-lead Open Handset Alliance (OHA) promise to increase mobile web access in the United States and to give more order and direction to mobile platforms by improving the mobile web access experience. However, while that might be the intention, the iPhone’s glitz and glamor only goes so far when people want to view rich media content on the Internet and it is unlikely that the OHA will be able to meaningfully impact mobile search navigation and the more complicated demands of web access in the near future.

InfoGin’s services, primarily its Internet Mobile Platform, offers anyone who has a web-accessible phone — with a participating carrier — a better Internet experience without the hassle of buying a newer phone or the obligation of upgrading a phone’s firmware. InfoGin’s service automatically changes any website that a user goes to on the phone.

Compared to a service such as Yahoo! Go, InfoGin is a lot easier and doesn’t require users to download anything. However, while InfoGin services provide a better user experience, it is not enough to overshadow the additional need for phones to be able to handle rich media requests and streaming — something that in the end, for InfoGin’s services and the future of mobile web, should be of great concern.

However, considering that 32 cell phones are sold every second and InfoGin’s current customer reports of its solutions “doubling web site traffic” and decreasing operational costs of “creating and handling web content” by 80%, InfoGin should be able to continue to expand its current reach of 20 million cell phones unhindered for the foreseeable future.

Additional Resources
InfoGin has record year
InfoGin takes on iPhone with Intellient Mobile Platform
Overview of industry’s future
Mobile Web University Trial
InfoGin Press Release

During the week of November 18th, Israel’s technology sector saw cleantech and security companies gain more traction and Internet TV media management company, TVinci ink a deal with MTV Israel. It also saw the oldest pharmaceutical company, Merck, invest in R&D in Israel. For a full overview of the latest in technology news from Israel this past week, watch the slideshow below.


A few weeks ago, the Globes reported that the video service, ooVoo.com is “in negotiations to produce original Israeli content for its website, and on websites of prominent Israeli broadcasters.” The company is interested in spending $500,000 on the project. Not surprisingly, ooVoo’s technology was developed in Israel, so it makes sense that it wants to develop Israeli content.

The plan will include “very high quality video and audio chat rooms about Israeli and international celebrities.” When contemplating the current nature of video on the Internet (Skype, YouTube, Ve-Oh, BlogTV, Walla), live video and audio chat rooms is a new concept that none of these sites have really explored or fully embraced. It will be interesting to see how this proposed project fares with Israeli users and how other sites will integrate this in the future.

If you want to learn more about ooVoo, there are a bunch of videos currently floating around on YouTube. Below is one I found from Kiwibox.com on YouTube that shows ooVoo in action at the Digital Life Expo a few weeks ago.

For more on other online video-related activities by Israeli companies and how what ooVoo is doing differs, check out the following past posts of mine:
VON Israel and the future of VoIP
First online TVPC network? RayV
Israeli TV on the Internet: Ahead of the curve
Company in Focus: Walla Communications Ltd

News:
According to a Globes article, Israeli Internet portal, Walla! is continuing to lose ground to the most viewed site in Israel, Google Israel.

Background:
Walla! was started in 1995 by Erez Philosoph and Gadi Hadar as an index of Internet sites. Today it is an Internet portal that offers news coverage of Israel and the rest of the world as well as additional original content in all of its portal fields. After going public on the Tel Aviv Stock Exchange (TASE) in 1998, Walla! worked with mobile carrier, Partner to create the first wireless portal for smartphone users in Israel in 1999 and merged with Israel On Line (IOL) in 2001. For several years, Walla! was the most visited website in Israel until Google past it last year.

Analysis: Walla! is the Israeli version of Yahoo!

In an entry posted earlier this year, Darnell Clayton of IsraGood alluded to Walla’s heading for the fate of becoming the Israeli version of Yahoo! I strongly agree that Walla’s history mimics Yahoo’s in several ways.

Since it tried preempting Google’s Gmail with its own free 1G e-mail account for users worldwide in 2004, Walla! has placed itself as a direct competitor to Google and has allowed its users to associate and compare its service with that of Google’s. So far, we all know who won that battle.

During that battle, Walla’s claim was that as Gmail was just starting, it would focus more on text and basics in email, whereas Walla’s email service was more established and allowed multimedia in addition to text in its email. Despite that campaign not working out, Walla’s most recent announcement is once again a multimedia claim.

According to a Globes article earlier this month, Walla! has launched a new “Video Talkback” feature to provide viewers with “the option of responding with video clips to programs and items appearing on the website.” What impact this will have on users on the site and if it will attract more viewers will need to be seen.

However, the marketing and target audience for it might be a little more different this time. Last week, a posting was sent to the Digital Eve Israel listserv about an opening at the company for an English-speaking marketing communications manager with a reply address to international marketing at the company. What Walla’s marketing department has planned for the next few months in response to Google Israel’s gaining ground and in support of its new “Video Talkback” technology will certainly determine whether Walla! can catch up to and possibly overthrow Google Israel and regain its title as most-viewed site or if it really will become the Israeli version of Yahoo!

During the week of November 11th, Israel’s technology sector saw AOL purchase its second Israeli company (Yedda) in as many weeks and a slew of interaction between Israeli companies and Asia. Watch the slideshow below for a full overview of the latest in technology news from Israel.

For a larger version, click here

Over the past few Fridays, I have been exploring water technology in Israel and giving examples of why this is an emerging field for Israel and Israeli companies. So far, I have briefly explained the origins of this field in Israel and listed some government and VC initiatives that are helping this field emerge. To complement last week’s summary of current investment activities in Israel that will help make Israel known as the leader in water-technology solutions internationally, this week’s edition will detail the technologies that Israel has applied and excelled in over the years.

To begin with, according to the WATEC website, Israel has come to stand out in recent years for having the:

* The world’s largest RO (reverse osmosis) desalination plant
Located in Ashkelon, this plant is internationally recognized as the most advanced in seawater reverse osmosis. A synthetic membrane rejects salt while it passes fresh water at “reasonable flow rates and realistic pressures.” Though this technology has been around since 1959 in the United States, in recent years it has been widely adopted by Middle Eastern countries, with Israel emerging at the forefront with its highly advanced plant that is run by IDE Technologies, Ltd. The plant has attracted attention for producing 100 million m3/year at one of the lowest prices in the world. In doing this, the plant produces around 13% of the country’s domestic consumer demand – equivalent to 5–6% of Israel’s total water needs.

Overall, the plant provides:
* adequate pre-treatment
* a high-pressure pump and an efficient energy recovery system
* a membrane assembly
* post treatment (if necessary)


* The world’s most developed irrigation methods

66% of Israel is considered arid. The lack of water resources in these areas (mainly Southern Israel) has been the main inspiration for farmers to try new, innovative irrigation techniques to make the desert blossom. Probably Israel’s field with the most advancements when it comes to water technology, drip irrigation is the main method used to conserve water while making sure that plants and and farming land get enough water. According to the Israeli Government’s export Website,

“drip irrigation is the most efficient method as regards water saving. Since the drippers emit the water directly to the soil adjacent to the root system, which absorbs the water immediately, evaporation to the air is minimal. This effect is especially important under the conditions prevailing in arid zones.”

Additionally, the Website goes on to explain that unlike other methods, drip irrigation “makes it possible to utilize saline water by eliminating direct contact between the water and the leaves, thus avoiding burns.” It also “allows the use of sewage water because the water is delivered directly to the ground, minimizing health risks.”

While desalination and drip irrigation are more mature water areas with established revenue streams that are growing, Israel’s water industry is also becoming known for having “the world’s highest reused wastewater rate,” and “the world’s most advanced national water management system.” With Israel’s continued focus on becoming the “Silicon Valley” of water technology title, several Israeli companies in these areas are starting to get heightened attention from both the media and investors. Don’t miss next Friday’s entry on which Israeli companies you should watch out for in this field in the next few years.

News
Last week, Gemini Israel Funds made the news as one of several investors who contributed to the new Israeli solar-energy start up that raised $9 million in funding, XJet, Ltd (see my post). For Gemini Israel Funds, the investment marks the second cleantech start up that it has added to its portfolio since August and signifies a new importance the company is putting on the future of cleantech.

Company Overview

Gemini Israel Funds was the first Israeli VC fund to be established from the Israeli government’s Yozma program in 1993 after Israel high-tech and VC pioneer, Ed Mlavsky, agreed to manage the fund. According to Gemini’s website, over the years, Gemini has focused on seed and early fund investments in areas of Communications such as Wireless Technologies, Enterprise Software, Internet, Consumer Electronics and Semiconductors, investing in companies such as RADLive, WeFi, Inc, IXI Mobile Inc, Adap.TV, Triana Inc, and OpTier Inc. Gemini has offices in Israel and Silicon Valley and manages funds totaling $550 million.

Analysis: Sun only beginning to shine on investing in Israel’s cleantech sector

While cleantech still isn’t a top priority for Gemini (it currently only has two cleantech companies in its portfolio), its recent cleantech investments have placed Gemini as a serious leader in cleantech venture capital community in Israel — an area that is picking up steam with the coverage that companies such as XJet, Ltd and Project Better Place have been getting lately and the latest news that Al Gore has become a partner in the VC firm, Kleiner Perkins Caufield & Byerswill (KPCB) and will help the company find and invest in start-ups globally (including Israel).

Despite any potential future interest by KPCB, as more Israeli and international VC firms become active in Israel cleantech in the future, Gemini is poised to be little affected given its approach and its founding partner and Chairman, Ed Mlavsky.

According to a company self-description, “Gemini’s key contributions include an ability to make daring investment decisions and the capability to utilize past operational experience in assisting portfolio companies.” The firm’s willingness and ability to make “daring investment decisions,” is a direct influence of Mlavsky.

Since his days at Tyco in the 1960s, Mlavsky has always embraced new technologies and has taken risks with them. While at Tyco (which he co-founded) he initiated the development and commercialization of a “novel photovoltaic technology” that he later oversaw as Executive Vice President of joint-venture Mobil Tyco Solar Energy Corporation. Risks such as that led Tyco to become the $40 billion company that it is today (and Gemini to have $550 million in funds). As such, it can be assumed that his attitude is what has sparked Gemini’s early entrance into cleantech. Additionally, his experience (and solar-energy expertise) fulfills Gemini’s “capability to utilize past operational experience in assisting portfolio companies” in cleantech, which, presumably, also gives the company a bit of a one up in the experience department over other Israeli VC firms entering cleantech.

However, although the cleantech industry is poised for great success, it is still a fledgling area and requires many obstacles to be lifted before any company will become a major global player and give Gemini and other VC firms the returns that they expect. Analysts predict that since this is a new area, big payoffs and mature cleantech startups aren’t likely for several years.

This may take even longer as it is very unlikely that in the near future any cleantech start-up will be able to expand its market-share significantly in major markets such as the United States and China due to a lack of government incentives and payoffs in the former, and lax regulations in the latter. As both governments become increasingly pressured to make these changes, though, and even more opportunities open up, Gemini’s business acumen should ensure that its cleantech companies will meet its expectations and eventually provide it with a nice ROI.

Additional Resources
Adap.tv
Overview of Gemini
Opportunities in Television
OpTier

Company Blogs
Ed Mlavsky: GOLB
Tali Aben
Daniel Cohen
Sagi Rubin
Ouriel Ohayon