More than 90 percent of the Fortune 500 companies in the United States use the products of the Israeli company Check Point.Three Israeli firms made Red Herring Magazine’s list of the 50 private and 50 public companies “most likely to change the world,” with two of the companies, Check Point Software Technologies and Mellanox Technologies, showing continuing strength by being listed two years in a row.
The prestigious survey by the influential San Francisco-based technology journal also included such powerful U.S. giants as publicly held Dell Computer and Oracle, as well as such privately held stalwarts as Google, the widely used search engine, and disc-drive maker Seagate Technology.
Check Point and Mellanox, along with a third Israeli company, Schema, Ltd., were among about 20 non-U.S. firms listed in the survey, which aims to highlight tech companies “that are bent on overcoming theoretical scientific limits and are capable of building sound business models from their developments.”
Each company on the list received the endorsement of venture capitalists and investment banks for “its potential to disrupt an existing market or create a new one altogether” and for the skill with which it carries out its business plan and for the skill of its management.
While Check Point, Mellanox and Schema are at different stages in their developments, and in different markets, they each have created paradigm-shattering innovations in their fields and all three companies have already had a significant impact on the U.S. market.
Check Point is the No. 1 provider of corporate firewalls and virtual private networks to protect computer systems from hackers, a sector that analysts expect will reach $4 billion in sales this year, according to Red Herring. Since its founding in 1993, the company has installed its products at more than 250,000 sites, including 90 percent of the Fortune 500. Chief executive Gil Shwed claims the company’s flagship product, Firewall-1, has never been breached.
Schema, with research and development facilities on Kibbutz Glil Yam in Herzliya, is in the business of helping cellular operators use available radio spectrum more efficiently, a significant plus in the crowded U.S. market for bandwidth.
For the average American, Schema’s innovations in expanding bandwidth for cellular telephones have several major benefits. These include fewer dropped calls, improved voice quality, and – because Schema can significantly reduce the need to build transmitters – lower prices for cellular calls.
With more than a 570 percent increase in revenues in the last five years, Schema has recently signed major contracts with leading U.S. carriers, including US Cellular, Cingular and Verizon.
Mellanox, based in Yokneam, Israel, and Santa Clara, California, makes chips for high-end servers that dramatically increase the speed by which data moves within the servers and between networking and storage devices.
Check Point is perhaps the most prominent Israeli company traded on Wall Street, and arguably the one with the highest public profile. In 2001, the company posted $322 million in profits, a 46 percent rise compared with the previous year, on sales of $528 million.
If Check Point has already changed the corporate world by soothing managers worried about hackers and ill-intentioned insiders, its selection by Red Herring may reflect confidence that the company can protect communications closer to home.
Many of the more than 28 million telecommuters in the United States log on to their company networks from their home computers. High-speed residential Internet services are especially vulnerable to hackers because the data lines are fast, and always on, thus increasing exposure to credit card data and identity information. In addition, high-speed Internet can provide “back door” access into corporate networks.
In response to these growing fears, Check Point made a bold entry late last year into the home office and small-business market with a mini-firewall that plugs into a PC.
In addition, an expanded partnership with Nokia is expected to give Check Point a way to enter the cellular data market that includes the 73 million people worldwide who use wireless data phones. This burgeoning group is expected to grow by 700 percent to a half billion by 2006.
Mellanox has more than 200 employees in multiple sites worldwide. The company’s business operations, sales, marketing and customer support are headquartered in Santa Clara, with the design, engineering, software, system validation, and quality and reliability operations in Israel.
Upside Magazine also recognized the company this month as one of its Upside 100. Earlier this year Mellanox was included in Network Computing’s Companies to Watch and Computerworld’s Top 100 Emerging Companies.
The company has raised more than $89 million and has strong corporate and venture backing from Bessemer Venture Partners, Dell Computer, Intel Capital, Raza Venture Management, Sequoia Capital, Sun Microsystems, US Venture Partners, Vitesse and others.
Schema’s accomplishments have not only won the recognition of Red Herring. The company was also cited by by the U.S. accounting and consulting firm Deloitte and Touche as one of the fastest growing technology firms.