Israel’s success in the technology sector is no secret. Over the years, the country has become a key research and development center for multinational companies such as Motorola and Intel, had a role in revolutionizing the way we use the Web and conduct business on it, and kept our computers and browsers secure.
More than 3,000 start-ups have been launched in Israel and in 2009 $1.12 billion in capital was raised by 447 Israeli high-tech companies.
The quantity and successes of Israel’s startups have earned the country the nickname startup nation. While most of the attention is focused on its contributions to cleantech, biotech and green tech (Israel created drip-irrigation), perhaps no sector has had more of an impact than its Web sector.
Most well known for developing instant messaging, which AOL bought and turned into AIM, and for the shopping comparison site Shopping.com which eBay purchased, the web sector has gained new traction in recent years. In 2009 alone, the sector received 22 percent of VC funding and saw three companies sweep the TechCrunch50 awards. In May 2010, Israel’s Soluto, an anti-frustration software that boosts PC efficiency, won TechCrunch Disrupt.
In the book Startup Nation, authors Dan Senor and Saul Singer attribute Israel’s success to the diversity and education of Israeli immigrants, the “chutzpah” of Israelis, and the mandatory military experience after high school, among other factors.
Yaron Samid, an entrepreneur and founder of TechAviv Angels, a group that connects successful Israeli entrepreneurs and investors in the Internet and mobile sectors, thinks the military experience and the culture it creates are the biggest contributing factors to the country’s success in this sector: “In the army, these young soldiers are being told what they can and can’t do. When they get out of it, they realize they are now in control and can determine their own destiny.
“The army has instilled upon an entire generation a spirit that is conducive for building a Web startup. You have very smart guys coming out of it who want freedom and don’t want to join a big tech company. They have found it in developing Web applications with little cost,” Samid asserts.
Low costs and numerous successes have attracted investors such as Jeff Pulver. A former pioneer in Voice over Internet Protocol (VoIP) and current Internet angel investor, Pulver maintains strong ties to the sector in Israel and frequently visits the country to meet with local web startups because “what sector of the Internet space hasn’t been touched by Israeli innovation?”
This situation is likely to continue for the foreseeable future. According to Daniel Cohen, partner at Gemini Israel Ventures, while historically Israel’s biggest contributions have been Shopping.com and instant messaging technology, “In the future, Israel will dominate certain niches, such as gaming and advertising, and as the market focus shifts away from the US, Israel can produce a big mainstream winner in Europe or Asia.”
ISRAEL21c brings you the top 10 Israeli companies contributing to the Internet today.
Founded by CEO Bob Rosenschein in 1999 as a desktop software company called GuruNet, Answers.com was launched in January 2005. The site started out as a one-stop, pre-research online hub that aggregated licensed content from different reference resources, including Barron’s and Miriam-Webster, until November 2006 when the company acquired FAQ Farm, a user-generated Q&A site.
Renamed WikiAnswers, the Q&A service has since been integrated into the rest of the site and was ranked the 2nd fastest growing domain in the US in 2009, second only to Facebook.com.
To date WikiAnswers, which lets users post questions and has a community answer the questions and edit them as a wiki, has over one million questions and 100,000 daily visitors. WikiAnswers is helping to change the way we find information.
2. MediaMind (formerly EyeBlaster)
Since it was founded in 1999, MediaMind has helped to change the way the Internet is used by users and advertisers. Through its rich media ad solutions and recent ad-serving platform, advertisers have been able to engage Internet users and users have been able to interact with the ads. MediaMind, the flagship product, is an ad serving and campaign management solution that gives agencies and advertisers total control over their campaigns.
In 2009, MediaMind delivered campaigns in different ad formats including rich media, in-stream video, display, search and mobile for more than 8,500 brands in 55 countries worldwide. So far in 2010 the company has partnered with NBC to create online ads during the Olympics and with Mojiva to bring analytics and rich media advertising to Apple’s iPad.
To grow the business and take more of a share of the market that is currently dominated by Google and Microsoft, the company changed its name to MediaMind in June 2010 to better represent its chosen direction. It is also planning to file for an Initial Public Offering (IPO) on the NASDAQ stock exchange in 2010.
Another web startup that weathered the dotcom bust, Incredimail develops personal desktop software. Its applications have been downloaded in excess of 80 million times by people in more than 100 countries and have enhanced the user experience beyond text.
Changing the way tens of millions of people communicate on the web, its software enables users to express themselves by adding emoticons, background colors and other features to their online communication tools.
While some of its software, including IncrediMail Premium and Magnetic, is for sale, IncrediMail’s main source of revenue is users availing themselves of its search box, IncrediMail MyStart, which is powered by Google. The partnership with Google, which began in July 2008, helped the company grow during the recession and to rise 10 percent in the first quarter of 2010 to $7 million. The company went public in January 2006.
iMedix is a health search engine and social network that enables users to find and share health information with patients around the world. It has also thrived on the idea that a community can help users make more informed decisions that are better for their health, from diagnosis to treatment, based on their experiences and the growing trend of people turning to their online peers rather than to medical experts.
The company was founded in 2007 by Amir Leitersdorf and Iri Amirav.
The brainchild of serial entrepreneurs Yaron Galai and Ori Lahav, Outbrain was founded in 2006 as a blog recommendation engine. Bloggers can add the Outbrain OutLoud widget to their blog and users can then rate the content of the blog as well as find suggestions for other articles on that blog or other sites that might be of interest to the reader based on the ratings of other readers.
As the amount of information on the Web increases and becomes harder to find, Outbrain is changing the way we discover new content and help others to do the same. To date, Outbrain has been installed on more than 30,000 blogs and is running over 2.5 billion recommendations a month.
Founded in 2006 and launched in late 2007, Kaltura is the first open source online video platform. A wiki for videos, Kaltura enables web publishers to integrate its video and interactive rich media functionalities and customize it to the particular interests and needs of their target audiences.
In 2007 it won People’s Choice awards at both TechCrunch40 and Mashable’s Open Web Awards. Since January 2008, Kaltura has worked with the WikiMedia Foundation to help bring rich-media collaboration to wiki sites, including Wikipedia. To date, over 60,000 web publishers use Kaltura’s technology, including Pepsi, PBS, and Sony Music.
Face.com is a facial recognition technology that analyzes and identifies people in photos. Released as an application for Facebook in 2009, Face.com’s Friend Finder can search through your friend’s photos and identify you in those that are untagged.
Though Face.com’s technology has huge potential as a security application, the company is currently focusing on the consumer market where it is enabling millions of users to identify and tag or untag themselves in photos on Facebook. As of April 2009, Facebook had more than 15 billion photos and as of June 2010 has over two billion photos added to it monthly. In May 2010, Face.com announced that since launching in April 2009 it has tagged seven billion photos and identified 52 million faces. It also made its API available to developers.
The company was founded in 2007 by Gil Hirsch, Yaniv Taigman, Eden Shochat and Moti Shniberg.
MyHeritage is a family-based social network that completes the social network trifecta of friends, business acquaintances and family. Founded in 2003, MyHeritage helps users build their family trees and connect to and share information with family members. After acquiring OSN, a network of genealogy sites including popular sites in Germany and Poland in early 2010, MyHeritage now has 540 million profiles and 47 million active users.
Through the site’s social networking and facial-recognition photo-tagging abilities, MyHeritage is transforming the way family members communicate with each other and helping members find long-lost relatives. To date, MyHeritage has raised $24 million and is profitable.
FixYa is an online technical support community of experts and consumers who come together to trouble-shoot post-sale technical issues of products.
Founded by Yaniv Ben-Saadan in 2005, Fixya gathers product support information throughout the Internet in one location and has a Q&A knowledge base that covers everything from car questions to the iPad. The information is constantly updated by a committed community.
By offering a WikiAnswers-type site focused on tech support, Fixya has forever changed the way consumers trouble-shoot technical issues with products, and has gathered together consumers and experts in one community.
Mike Eisenberg of Benchmark Capital, a venture capital firm, recently spoke in the US on CNBC about how social search will be ‘the next big thing’ and used Conduit as an example. The company, which provides publishers with a marketing platform in the form of a social tool bar that enables viewers to more easily share content, is already a ‘big thing’ and has contributed to the web in a significant way.
Used by TechCrunch, Amazon.com and 220,000 other sites, Conduit has changed the way publishers distribute their content and extended their reach, as well as helped to bring more relevant content onto readers’ screens. According to Eisenberg, 19 new users install Conduit every second and it has had 100 million active views.
Founded in 2005, Conduit added the Conduit Marketplace in 2009 as part of a new initiative called Conduit Open. The Marketplace takes advantage of its 220,000-plus publisher network to create additional distribution opportunities both directly and indirectly. In March, the Coca Cola company had a successful campaign and reached more than 10 million people using Conduit.