Israel Innovation 2.0

Inside Israeli Technology

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In 2010, Israel’s Internet sector came of age, mobile hit its stride, more capital began to flow into Israel, and several companies grew. Here is a video recap of some of the biggest headlines and stories from 2010.

Happy 2011!

Every year Deloitte Brightman Almagor Zohar, a professional services firm under the interational Deloitte brand in Israel, releases an annual list of Israel’s top 50 fastest growing technology companies for the year based on percentage revenue growth over a five-year period. Seventeen software companies ranging from security to finance to storage made the list this year. Below is the top 10 software companies on the list and a little more about them. Will you be using any of these companies’s technologies in 2011?

Safend

Safend Deloitte Fast 50Israeli data protection company, Safend offers products for data encryption and port and device control. Founded in 2003, Safend was named to Gartner’s Magic Quadrant for Mobile Data Protection in 2009. The company also rounded out its suite adding Safend Inspector and Discoverer to Safend Reporter, Safend Encryptor and Safend Protector.

Algosec

AlgoSec Fast 50Founded in 2003, AlgoSec is a leading provider of firewall operations and security risk management solutions. Its AlgoSec Firewall Analyzer and FireFlow™ products improve efficiency and reduce costs by intelligently automating formerly time- and labor-intensive tasks surrounding firewall, router and VPN management. In 2009 the company received a “Best of 2009″ designation from SC Magazine for its products.

Promisec

Promisec Fast 50Promisec, an internal network security solutions company, was founded in 2004 and offers the double benefit of securing networks and managing power on desktops. It was added to Pacific Gas & Electric (PG&E)’s power rebate list in 2010 and was one of the RedHerring 100 companies for 2009. Its products include Promisec Spectator, Promisec INNERspace, and Promisec MSP.

Imperva

Imperva logoImperva is an application data security company that was founded in 2002 by Amichai Shulman and Check Point Software co-founder Shlomo Kramer. The company was named to Red Herring’s Top 100 in 2007 and grew by more than 80% in 2008. Its success during the recession has been attributed to its software helping customers cut costs. Imperva’s products include the SecureSphere Data Security Suite, SecureSphere Web Application Firewall and Database Activity Monitoring.

cVidya

cVidya Fast 50Founded in 2000, cVidya Networks provides Telecom Revenue Assurance and Dealer Management solutions. A recipient of the 2009 and 2010 Global Telecom Business Innovation awards, cVidya’s Integrated Revenue Intelligence Solutions (IRIS®) includes MoneyMap®, FraudView®, and BusinessView™.

Red Bend software

Red Bend logoRed Bend Software is considered to be a market leader in Mobile Software Management and Firmware Over-the-Air (FOTA) update solutions. Founded in 1999, Red Bend Software offers solutions that give phone users more control over what software components they want on their phones while also increasing the data service revenues of phone carriers. The main solutions include firmware updates, software component updates and data management.

InfoGin

InfoGin logoInfoGin 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.” The company’s Internet Mobile Platform (IMP) technology is currently being implemented by several major companies, including Virgin Mobile (UK) and MapQuest.

Modelity Technologies

Established in 2000, Modelity Technologies offers a financial modeling and portfolio analytics platform for financial institutions, such as banks and insurance companies, to stay competitive and improve their performance. Its products include Modelity/Advisor, Modelity/Funds and Modelity/Structures.

IDIT I.D.I. Technologies

IDIT logoIDIT Technologies was founded in 1998 and offers SOA-based software solutions for the insurance industry. In July 2009 Forrester Research named the company among the hot insurance tech companies to watch in 2009, mainly for its multi-language and currency support innovations. The IDIT software suite addresses the specific end-to-end needs of general insurance for the insurance and financial markets including Business Intelligence, Workflow Management and Customer Relationship Management (CRM). IDIT’s R&D center is headed by Lilia Waserman and its customers include Alfa Insurance and RAC Insurance.

Commtouch Software

Commtouch logoFounded in 1991, Commtouch develops software to protect e-mail by offering spam and Zero-Hour™ virus outbreak protection. Its anti-spam solutions feature its Recurrent Pattern Detection (RPD) technology and have been licensed by over 80 security and messaging vendors and providers including Aladdin, Check Point, Fujitsu and LG N-Sys.

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If you ever wonder what the most important networking website in Israel is for Israeli startups, it seems that Meetup.com might have more impact on a company’s success than LinkedIn or Facebook. Or at least in the initial stages of forming the startup. Without Meetup.com – which helps groups of people with common interests plan meetings - there might not be as many startups in Israel as there are right now and they might not be as successful or as promising as they are without the networking and fundraising opportunities that the different groups that have popped up on Meetup.com in recent years have offered them.

Almost certainly there wouldn’t have been the unique opportunity to create a networking group focused on encouraging and empowering female entrepreneurs and aspiring female entrepreneurs in Israel to succeed. There also almost certainly wouldn’t have been a new annual event that allows some of the most promising startups founded by females to present to a room full of venture capitalists and angel investors and to meet with them afterwards. Thanks to Meetup.com though, there’s Yazamiyot. And all this and more has become possible.

A year after Gemini Israel Funds Associate Einat Metzer started the group, Yazamiyot – which is the Hebrew plural for “female entrepreneurs” – has over 200 members and holds monthly meetups and additional activities to inspire female entrepreneurs, help them grow as business people, and give them opportunities such as today’s FundHer competition.

Ilana Jucha

Ilana Jucha of Stat-Market

At least fifteen startups founded by women were in attendance at the event and five of them -Flakkes, Yubitech, Stat-Market, microSteps, and Brandsforce – presented. Aside from Yazamiyot members, the audience was primarily made up of investors who had the ability at the end of the presentations to vote for which company they liked the most.

The winner, microSteps is an educational technology company that currently provides the private school market, specifically preschools, with a web portal that manages all of the school’s communications it has with parents. One use of the portal is removing the need the need for those notes that used to be sent home with kids only to be thrown out without reading after they got crushed in the kids’ backpacks. Founded by Elanit Halevi-Yariv and Yael Goshen in 2007, the company currently has a presence in Atlanta and New York and over 50,000 registered users in 28 states across the US.

Here is a demo of microSteps solution:

The runners-up of the competition were Yubitech and Brandsforce. Founded in 2009 by Danny Weissberg and Nili Shohet, Yubitech mobilizes any enterprise application into an application that can run on any smart-phone in just a matter of days. Brandsforce, founded by Nili Goldberg-Levi, offers marketers and advertisers a social media recruitment solution that identifies relevant opinion leaders and recruits them to help promote a company’s brand and enhance brand engagement on social networks.

Here is a video of YubiTech’s solution:

Stat-Market was founded by Ilana Jucha and offers real-time analytical software that can predict customer behavior and help maximize customers’ lifetime value (LTV). Founded by Ruth Polachek in 2008, Flakkes bridges the gap between users and advertisers by enabling users to provide direct feedback on what they think of a company’s online ads. See the video below.

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Deloitte Israel Fast 50 Logo

Earlier today Deloitte Israel announced the 50 fastest growing technology companies in Israel based on percentage revenue growth over a five-year period. The 10 fastest growing companies overall were Pontis, Tufin Technologies, Kontera, Telmap, Safend, Algosec, Promisec, Imperva, cVidya, and SuperDimension.

Pontis, a telecom company that provides contextual marketing and selling, had a revenue growth rate of 5,500% while overall the Fast 50 companies had an average growth rate of 740%. 61% of the companies are in the software and Telecommunications/Networking sectors. Just as impressive as the 17 software companies listed, six Internet companies also made the list this year, making up 12% of the winners. The six is double last year’s amount (three) and triple the amount from the previous year (two).

The Internet companies on the list included Kontera, Answers.com, PicScout, Babylon, IncrediMail, and MediaMind Technologies (formerly EyeBlaster). The average growth of the sector is 762%. Along with the recent purchases of Dapper (by Yahoo!), 5min (by AOL), and QuickSee (by Google), it definitely seems that Israel’s Internet sector has come of age.

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Qualcomm and iSkoot Inside

Motorola's Droid X uses iSkoot's Kalaida™ Platform and Qualcomm's Snapdragon mobile processor

Qualcomm announced earlier today that it has acquired Israel’s iSkoot, a leader in “mobilizing internet services on the handsets most people use today”, for an undisclosed sum (rumored to be between $50-100 million).

iSkoot’s Kalaida™ Platform utilizes cloud computing to enable device manufacturers and mobile operators to bring popular social networks and new internet services to mobile handsets in a way that minimally impacts network and handset performance.

As part of Qualcomm Innovation Center, a Qualcomm subsidiary, iSkoot will focus on three areas: continued support of its current customers; integrating its offerings with Qualcomm’s products; ,and developing open source data management contributions for mobile devices.

With the growing popularity of smartphones and tablets, such as the iPad (the fastest-selling gadget of all time), the demand for such a service is huge and will continue to be with the release of new mobile devices and the launch of 4G networks in the U.S. and elsewhere. Qualcomm’s purchase of iSkoot indicates several things about the telecommunications industry and Israel:

  • Considering the fast pace at which development in the mobile industry is moving right now and that the 4G space is still open to newcomers, several key players in mobile hardware and software, such as AT&T and Intel, have looked to Israel over the past few months to help them try to gain an edge.
  • The acquisition is the latest in a string of Israeli startups getting acquired by major companies, including Google, AOL and Dell, this year. What impact these acquisitions will have on the growth of Israeli startups in the future is to be seen, though it currently doesn’t look good. Whatever the impact it has on Israel’s startup culture, it seems that considering this sale and the opening of new innovation centers here, the heart of the future of 4G and mobile communications is slowly becoming centered in Israel.
  • According to Globes, iSkoot is the first Israeli company that Qualcomm, “the world’s largest supplier of mobile telephone processors and owner of the intellectual property for the CDMA protocol” has bought, though it has had a development center in Haifa since the mid-1990s. Given that AT&T, Qualcomm and Intel all have R&D centers in Israel, will Verizon look to Israel next?

Here’s a video of iSkoot’s Social Net app in action:

Image via yonghokim.

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The Jerusalem Post, the main daily English Israeli newspaper, has implemented SemantiNet’s Headup application and is currently running a pilot with it. At first glance, Headup, which has been added to this blog too, seems to be potentially another annoying widget that will underline certain keywords (that may or may not be relevant) and include a pop up when the word is clicked on.

Offering three different linking options – tabs, snippet, and link – SemantiNet takes the idea of information gathering to a different level though. The tab option, includes, when it pops up, a description of the word or phrase from Wikipedia, along with other tabs for news related to that word from that site and other sites, photos, videos, Tweets and anything else that is relevant to the link, giving viewers the chance to see the word in real-time.

semantinet-headup-app-tabs

The snippet includes a description, a picture and related articles, while the link option is just a link to a page. Not just any page though. It is a page that gathers all the information that was in the tab option and displays it on one page (see below). When the settings are set to link, viewers who would click on a highlighted word are taken to a page on the Headup domain with all that information, plus a way to see what friends are interested in via Facebook Connect and an advertisement on the side.

Semantinet Headup Topic Page

In the case of the JPost, the topic pages stay on the JPost domain. Called the JPostPedia, the JPost’s intention is to create the ultimate source of information related to Israel and the Middle East using these pages.

The “authoritative source of information on a wide variety of topics relating to Israel and the Middle East” as Shai Tsur of Giza Venture Capital, which is invested in the company, puts it in his post on this. Such a source signifies a change in the content generation, aggregation and distribution game.

By utilizing Headup, news sites provide their readers with a more complete context as well as an easy way to consume additional content. By creating topic pages, publishers can essentially unearth archived material that users would not generally think to look for and present it to their users within a particular and more complete context. Users get more information about the articles they are reading and sites get more pageviews and provide a better user experience.”

It also gives publishers more pages to monetize. In the case of blogs, such as this one, it can offer visitors a chance to find/discover additional relevant content on this site and other sites. In addition, there is an option to have publisher content syndicated.

All this related to the topic pages leads to the question, except for wikipedia, are most wikis about to become obsolete? Share your thoughts in the comments below.

::BloGiza

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IDF-in-Haiti

IDF treats Haitian girl

The Israel Defense Forces’s ongoing efforts to embrace the Internet continues. A few days before IDF representatives explained to 140Conf participants how the army used social media to update the public about its efforts in Haiti and to help save lives there, the army announced that it created and is using a website modeled after eBay for the purpose of selling and buying surplus equipment.

The new site, called The Arena, is the army’s new effort to keep better track of inventory while potentially saving itself millions of shekels on “duplicate and wasteful equipment”. It is also partially a response to the poor capabilities it had in moving around equipment and materials that soldiers needed during the Lebanon War in 2006.

According to Bloomberg, Brigadier-General Maran Prozenfer, financial adviser to the chief of staff, explained,

“Every unit in the Israel Defense Forces will be able to put up for sale any equipment that it doesn’t need, so that other units can see and bid on it.”

Prozenfer expects the new site to significantly reduce equipment costs, which according to him currently accounts for nearly 40 percent of the army’s NIS 50 billion shekel ($12.9 billion) annual budget.

::Haaretz

Image via IDF Spokesperson Blog.

Emblaze Mobile, a subsidiary of Emblaze Ltd., announced yesterday that it was ending its efforts to bring the First Else, its linux-based smartphone, to market.

The announcement had been expected for quite a few months, especially when it failed to meet its Q2 goal of partnering with a wireless carrier. The phone, which debuted in London last November, was hailed for its user-interface which made it easy to access all of the phones functions and features with just the scroll of the thumb. The quality of the device, from the phone to the camera and everything else, wowed those who got to play with it. In fact, it was named the First Else, because it wasn’t just a smartphone, it was something else.

Perhaps the most disappointing thing about its failure is that it was a completely Israeli device. All the hardware and software was developed in Israel. Had it taken off, it had the potential to create lots of jobs in different sectors and to revive Israel’s long-lost manufacturing industry. There’s so many things it could have done for Israel’s tech sector and the Israeli economy overall. On a personal level, I was looking forward to the day when I could sport the First Else and show it off to friends and acquaintances here and abroad.

Instead, it’s failure is a reminder of the poor condition Israel’s tech industry is in. When I first read Emblaze’s announcement yesterday, I, of course, went on to Twitter and shared the article. I noticed afterward that a few friends had already shared the news with me, and one’s response was “add it to the list of magic tricks coming from Eli Reifman’s sleeves. Now you see it, now you don’t.”

Eli Reifman, the current President of Emblaze, co-founded the company in 1994, and is the one mainly responsible for growing it into a publicly traded company. At its height, the company came close to breaking into the FTSE 100. The company’s glory days didn’t last long though due to many factors.

One reason for its most recent failure with the Else is the approach the company took with developing it. In 2009, Emblaze shareholders tried to take control away from Reifman in protest of the Monolith project that he envisioned would “transform the world of mobile phones” when it launched in 2010. While a visionary with seemingly the right ideas, Reifman’s role in the management and execution of the project was less than stellar.

Unfortunately this isn’t the only such story and is connected to the performance of the rest of the industry. For all the success that Israel has had in innovation on the startup level and for multinationals (R&D for them), it is not sustainable. All of the conferences that I attended this past May and June reflected that in the discussions that took place. The solution is to try to grow big FTSE 100 companies but to do so requires good managers who can transform their startups into large companies and then lead these companies. Emblaze’s story reflects the current and past failures of the industry, and, if things stay the same,  the future of the Israeli tech industry.

Trusteer-LogoIt’s been a busy month for Trusteer. The company, which offers secure browsing services, was named a Red Herring Europe 100 winner last week and Amit Klein was named CTO of the Year by InfoWorld Magazine recently.

The criteria for the Red Herring award included financial performance, technology innovation and execution of strategy. According to the company, its solutions are used by more than 60 leading financial organizations in North America and Europe and by more than 6.8 million of their customers.

Regarding innovation, Amit Klein was recently honored by InfoWorld for his “discoveries of new attack techniques and for his leadership in improving the security of online banking and commerce.”

Under Klein’s leadership,

“Trusteer recently launched `Flashlight` a new remote fraud investigation and mitigation service which identifies the attack source on a customer’s machine, gathers samples, and can reverse engineer the mechanism used by the malware to commit fraud. Findings enable banks and other organizations to prevent future losses, block subsequent attacks, and takedown command/control servers.”

Trusteer CEO Mickey Boodaei has been very outspoken in recent weeks about allegations that Google is planning to drop the Microsoft operating system for security reasons. Boodaei has stressed that other companies shouldn’t follow since going to other browsers doesn’t solve the problem and could actually cause more problems on less targeted machines.

Trusteer is one of eight Israeli companies named Red Herring 100 winners this year.

Over the past few years there’s been significant increase in trade, investments and R&D partnerships between Israel and China. Except for during the recession, trade has increased steadily and is expected to grow even more as a result of the Israel pavilion at the Shanghai Expo and new initiatives among business organizations in both countries.

NDS-China-TradeRecent heightened business activity between the two include a plan from NDS, a digital pay-TV solution provider, to “augment its investment in the China market”; an R&D cooperation agreement that supports collaboration between Israeli and Chinese manufacturers; and an investment in a Chinese water company by Israel’s Infinity I-China investment fund.

According to Media Mughals, NDS‘s move comes after it,

“Identified a key growth opportunity through partnerships with Chinese companies in the consumer electronics space, semiconductors, systems integration, and digital-TV applications markets… According to Media Partners Asia, China is the largest market worldwide with over 66 million digital pay-TV subscribers. By 2014 this is predicted to reach 198 million subscribers. In parallel, cable TV revenues will increase from $9 billion in 2009 to $17 billion in 2014.”

NDS is tripling its investments to more fully immerse itself in all aspects of its business in China and is relocating part of its R&D resources from India and Israel there so that it can hire more locals as part of the efforts.