Every couple of weeks, I hear of a new Israeli start-up specializing in analyzing information from the internet and making some sort of profit out of it.

This time of start-up always piques my interest, and I try and to find out as much as I can on the semantic standards they aim for, but unlike impressive projects from abroad – a world were information sharing is more important than any NLP algorithm or a 50,000 word word table – Israeli start-up are less than willing to give away any information. Each and everyone is sure that they are the ones holding the secret key to ultimate knowledge, and must keep it under lock and key at all costs.

Maybe they’re right, but years pass, and I have yet to see a single Israeli start-up (including ClearForest), that really managed to live up to its promises. When dealing with semantic web, we find out time and again, that the difference between dream and the grim reality of the BI world is huge. Not many people actually want to pay for CI, not many people know exactly how to turn these reports into cold cash and only Google is becoming smarter and faster.

Either way, I too, have caught the data sorting bug, and for years I’ve been dealing in technologies which turn Unstructured Data into charts or triplets of Structured Data. I’ve been creating information containers that can be dismantled and queried and even, somehow, convinced myself that this turns me into more of a professional.

Regular readers of this website are aware that I firmly believe the semantic web is the “holy grail” of the information world, and the promised day when we could ask and think in SPARQL, SQL or any other technology, as well as enjoy a global informational JOIN is coming. But as time goes by, I also think that the serious solutions will be coming from the big players that are opening more and more APIs to their information, and are not hoarding information to themselves. I also understand that the entire direction of semantic start-ups needs to change.

Just as all the projects that have tried for years to copy LinkedIn’s information and suddenly found themselves with many competitors who are using the API, so the semantic start-ups need to stop trying to fight against the mountains of information out there, and focus more on organizing and exporting the information inside their organization, or turn the spotlight on that which already arrives sorted through various existing APIs. If they must send their spiders out for Unstructured information, then, like anyone who deals with semantic web and isn’t Google, they also have to limit their scope.

Semantic start-ups also need to “get close to the money”. They have no chance, however, of offering an ad-based or subscription-based business model for information that Google gives away for free. One more tip – even semantic start-ups that are claiming to be textual advertisers, are not in high demand nowadays. There are plenty of other start-ups humming the same mantra for years, and the venture capital crowd really doesn’t want to hear about it anymore.

But why am I suddenly mentioning this? And why the long introduction? Turns out, that Leadspace (formerly Data Essence), has received a venture capital investment from JVP and the Vertex fund. I’m still not sure if Battery Ventures (who invested in Date Essence in 2007) have made any additional investments, but as soon as I know any more – you will.

Leadspace was founded by Amnon Mishor and Yaron Karasik and later brought on Yochi Slonim, one of the founders of Mercury and former CEO of Identify Software (which, in turn, was sold to BMC). According to Mishor, Leadspace’s CEO, Slonim is responsible for moving Data Essence’s direction “closer to the money”.

Mishor wouldn’t say anymore, but I must explain that a semantic start-up that can create business leads, is already something that makes more sense for the large organization to which it is trying to sell its service. We’re talking about an organized market, departments with big budgets, fixed prices for every lead and a semantic system that can cause the sales rep to work with it on a daily basis, and not simply tag it as a nice toy with cool graphs.

Mishor was not ready to reveal details regarding the company’s development direction, and preferred to define the product as one which shows the client “business opportunities”,  he did claim that “Leadspace is operating in a growing market, one in which many promising solutions are trying to utilize the information available on the internet for marketing purposes, and can create, automatically, information on a client with a level of focus and relevant that does not exist today.” Mishor added that following the recent investment, the company is set on recruiting programer and employ several dozen employees.

Haim Kopans, a partner at JVP Studio, is also aiming towards the semantic web solutions intended to help an organization sell its products. He says that “Leadspace is samrt to utilize the critical information on the web for the organization, and formulate it into marketing leas that help in sales and other marketing activities.” Kopans explains that “The company’s entrepreneurs have a strong technological background, and a Board head with a strong business background, it is the ultimate combination we look for when investing.”

Translated by Itai Rosenbaum

Venture capital funds like investing in experienced entrepreneurs, ones who have already served in big parts in the IT world, and are looking to start a new start-up company.

So to all the VC representatives reading this, there are few men who answer to this definition, and one of this rare breed is Moshe Greenberger, former manager of EMC’s Israeli development center, and before that, the development manager of nLayers – a Gili Ra’anan (current partner at Sequoia Israel) owned start-up.

Greenberger’s new start-up, founded with David Lehavi, a former academic and senior algorithm developer for Correlix, is called Ximera Software, and according to Greenberger will “offer application developers a development tool for parallel processing computers.”

In an interview with StartUpMania, Greenberger explained that “many applications, in the video recognition, photo recognition, protein analysis or even simulators, require heavy computational power, some of which is readily available to the customer but is not used. We will offer a new tool for developers that will help them develop applications that will know how to utilize parallel processing power.”

What does he mean? Check out the Wikipedia article for GPGPU, a technique which allows you to use your Graphic Processing Unit for tasks which are traditionally done by your CPU. This is one of the more interesting ways to get more processing power out of your computer, but it requires special programming from the application’s developers.

“The problem with building applications which make use of parallel processing techniques is the knowledge gap between the academic leaders in the field and the developers of regular applications who do not know how to develop applications for parallel computing platforms,” Greenberger explains. “Often, developers simply do not make use of hardware that is already at their service.”

Translated by Itai Rosenbaum

Three Israeli security start-ups, Hacktics, Whitebox Security and Navajo Systems will take part in the RSA 2010 convention1 “Most Innovative Company” competition. The three companies will be presented as part of the “Innovation Sandbox” panel, as part of the global, annual information security convention, sponsored by RSA.

Innovation Sandbox is a panel dedicated to new technologies in the information security field, and allows those who work in the field to share knowledge and experience and keep up to date with the new emerging technologies that will allow them to face the most recent security threats.

“The purpose of Innovation Sandbox, and this prize in particular, is to locate and honor the companies and individuals that are standing at the forefront of innovation in the data security realm, and those with the highest potential to offer a solution to the security problems which exist today,” says Sandra Toms LaPedis, Regional VP and general manager of the RSA convention. “As you can see from recent data security events, the threats to security nowadays are more clever than they’ve ever been. The RSA convention’s purpose is to bring together that most innovative people in the field in order to give an answer to the problems plaguing the data security world.”

The winner in the “Most Innovative Company” competition will be determined by a 3-5 minute presentation before a panel of judges consisting of Michael Barrett of PayPal; Asheem Chandna of Greylock Partners; Gerhard Eschelbeck of Webroot Software, Inc.; Renee Guttmann of Time Warner Inc.; Ray Rothrock of Venrock and Hugh Thompson, Program Committee Chair for RSA Conference. The winner will be announced on Tuesday, before the entire convention attendees in the convention’s opening assembly.

Further information regarding the “Most Innovative Company” and the Innovation Sandbox program can be found at the convention’s website.

Translated by Itai Rosenbaum

Israeli security start-up Navajo Systems, first revealed on StartUpMania several months ago, was chosen as one of the ten most innovative companies of the RSA2010 convention, set to be held in San Francisco on March 1st.

Navajo, currently enjoying a seed investment from the Jerusalem-based JVP fund, is placing its chips on a few new buzzwords that we should all be watching out for, as well as offering real time security for cloud-based systems and SaaS. They call it Virtual Private SaaS (VPS), and it is something that is sure to catch the eye of many computing managers who are transferring their systems onto the cloud.

The title was granted to Navajo as part of the “Innovation Sandbox” panel, a special panel dedicated to new technologies in the security field. “Innovation Sandbox” allows security-based businesses to share their knowledge and experience and stay up to date with regards to all the new technologies in the field that will allow them to deal with the latest security threats. According to Navajo, their VPS solution promises that all the organizational information will be secured by encryption as long as it’s on the SaaS provider’s servers, all this without any modification to the SaaS application. Navajo’s representatives stressed that even if the database is stolen, hacked or a user experiences identity theft, the organization won’t suffer any damage, as the information is encrypted and useless. The fact that the information is encrypted, while outside the organizational network, provides an answer to various regulations in the privacy field. Regulations that in many cases, put a hamper on SaaS applications.

Navajo Systems CEO, Dan Gross

Another feature that Navajo promises is the ability to search through the encrypted content, sorting it through various criteria, all the while maintaining full control of the encryption keys.

“Many analysts in the SaaS field are consistently mentioning information security as the biggest problem that lowers the use of cloud services and SaaS applications within companies and organizations” says Dan Gross, CEO of Navajo. “Our vision is to prevent these security breaches, and answer the regulatory demands for the use of SaaS applications. With our VPS technology, companies and organizations can safely transition to SaaS applications and enjoy the SaaS model.”

Navajo Systems was founded by Gross, Dr. David Moshkovitz and Doron Abraham.

Translated by Itai Rosenbaum

A Solar-Powered Camel. Photo by: Ofer Dak

As of this writing, I’m in Eilat at the EilatEilot 2010 convention, to which me and Ofer Dak were invited by the courteous people at the Technologies Group. The convention focuses on Israeli start-ups dealing with CleanTech. We tried to understand what it really means to become energy efficient, and who’s slated to provide us with new, green energy.

The three-day convention was attended by many “energy professionals”, starting from Israeli politicians who are tied to the local energy infrastructure, to international officials who are trying to influence the global energy production map, all the way to dozens of suppliers, inventors and local utilizers of energy solutions.

Many came in suits and ties, in the midst of the scorching Eilatian “winter”, and in nearly every corner you can spot representatives of the world bank, the state of New York, European or Korean conglomerates, and leading US NGO reps. It seems that the EilatEilot convention has become a world-scale networking event, with a cosmopolitan vibe.

While we flew to Eilat with fresh memories from the Copenhagen climate committee, and even argued about the ClimateGate incident on the way, between the convention halls, at the Dan Eilat hotel and the show floor at the Herod hotel, people are no longer mentioning the environment and the future of our planet.

It seems that CleanTech in Israel, circa 2010, is mostly about regulations, government subsidizing, the price at which we can charge the electric company for each solar kilowatt, and exactly how many kilowatts can we get out of one meter of sun.

The “dream” square is currently occupied by talks of SmartGrid, the ultimate electric grid which everyone agrees is the “next big thing“ and should turn the old model of energy supply into something a lot more internet-esque.

The idea, basically, is that a consumer will be able to purchase as much electricity as he needs, when he needs it, at a rate comfortable to him and according to the energy consumption profile he wishes to adhere by. A particular device’s energy consumption will be common knowledge, and we could plan our usage according to lower rates at hours with less of a strain on the grid.

While Israel, with only one electric company and no real option of sharing electricity with its neighbor, will never likely be a world leader in SmartGrid application, it is possible the Israeli start-ups will develop sensors, control mechanisim and computing solutions for the global SmartGrid strategy and will be purchased by one of the big companies abroad.

Guido Bartels, general manager of IBM’s global energy and utilities, told me that in order to successfully develop SmartGrid solutions, or, as he calls that wider global efficiency program, SmartPlanet – a program meant to connect to the transportation and health industry among others – Israeli start-ups will need to install SmartGrid solutions in Israel, and actually deal with the industry and not just planning and marketing

Without my asking, he mentioned Better Place, a company that may work in Israel, in the same way he mentioned the other industry giants. I’m not sure if it’s because he’s here now, but my impression is that the man in charge of energy at IBM talked of Better Place as a partner in a long, global path, and not just another Israeli start-up.

Italian CleanTech execs mingle with Israeli Start-Up Personnel Photo by: Ofer Dak

The CleanTech start-ups I met at the convention, are very different from software, internet or hardware start-ups. These are not Linux geeks, iPhone-toting CEOs or data security enthusiasts. This is a combination of physicists and contractors that need to know how to market their projects to land owners, gain government permits to build, find funding and keep good contact with various government companies and make sure that dozens of tons of equipment are properly installed. Also, you have to promise to the customers the renowned Return of Investment (RoI).

Like in many organizational computing conventions, RoI is a key term here as well. Some start-ups promise a 5-year RoI, while some declare an 8-year period, if only you bring forth a permit to build a solar farm, a signed deal with the electric company for future sale of power and funding.

But in today’s Israel, before the real “Green Revolution”, there is no one who can present real data regarding installation of alternative energy sources that has brought real monetary savings and has covered the system’s purchase and installation costs. This, of course, includes the government subsidy the entire way.

Another variable is the wear and tear of the expensive equipment, as well as that the repair work of energy production devices after several years of use. Most supplier promise a warrantee good for five years, but the people I met have no idea what holding a solar farm for ten years is going to cost, which expensive replacement parts or adapters will need to be repurchased and is now even the right time to dive into the field.

Like in many new fields, it seems that CleanTech entrepreneurs can be divided into two groups – the alternative energy fields and the proponents of energy efficiency. The former believe that we live in the center of a galaxy rife with energy and we just need to learn how to collect it from the sky, earth, wind and water. The latter are basically a modern version of my grandfather, may he rest in peace, who always made sure to turn off the light, fearing that single 40 watt bulb will drain away his entire life savings.

A Pythagoras Solar Energy Wall. Photo by: Ofer Dak

Among the first group, I noticed the start-up Pythagoras Solar from Petach Tikva, founded by Gonen Fink, a former executive at Check Point, employing about twenty employees. Pythagoras Solar are developing clear walls for buildings, ones very similar to the exterior of the Azrieli towers, but with solar panels built in. According to Pythogoras Solar representatives, the company has already secured investments from the venture capital funds Israel CleanTech, Pitango and Evergreen, and it is designating its Building Integrated Photovoltaic units for skyscrapers. They are about to take part in their first project, and their “energy walls” are set to be a significant part of a large construction site in San Francisco.

Another interesting solar start-up is Solaris Synergy from Jerusalem, they develop “Solar Rafts” that are meant to float on lakes. According to Dr. Elyakim Kassel, the company’s business development manager, the lake’s water help cool the solar device, the bottom half of which is submerged in the water, and thus prevent damage to the silicone cells the unit is made of. Likewise, these floating devices do not require any specific permit and is a very convenient solution to energy companies that happen to own water reserves. Kassel revealed that Solaris Synergy has already signed a deal with Israeli water company Mekorot, which, according to him, is the largest Israeli consumer of electricity and during 2010 will lay out their system in the Taoz water reserve, near Latrun. The experimental facility is set to create roughly 200 kilowatts of electricity for every hour of sunshine.

Taoz Reservoir, scheduled site for the first solar raft

Among the start-ups working in the energy efficiency field, I was attracted to Powercom, an electric meter maker from the Ramat HaKovesh kibutz, employing roughly 25 people. The company makes meters that can be remotely read, and power outlets that can monitor, via RF frequencies, the energy consumption of the device connected to them, and even allows control of the current flowing to the customer via PLC. The company’s representatives informed me that they are entering a significant pilot with the electric company and may even receive a venture capital investment from it. The promise that within months, after the finish the installation process of their product in Israel, they will begin marketing LCD screen and smart splitters that allow any customer to receive an updated picture, in real time, of his or her energy consumption at home. Additionally, Powecom even declares their ability to provide detailed electric bills, through a remote read of the meters belonging to those customers who wish to manage their own electric bills, an option which may suite small kibbutzes or malls that own their own, internal system of electric supply and payment charges for consumption.

Translated by Itai Rosenbaum

I am proud to present the introduction video to SmartPilot1, held on February 8th.

Over the next few weeks we will upload to the SmartPilot website 15 more videos, each focusing on a different start-up founder and the solution his company presents.

Filming and Edits: Guy Raz   Interviews: Lobo Weizner and Raphael Fogel

Translated by Itai Rosenbaum

About a month ago I finally got an iPhone through work. Before that, I must admit, I wasn’t really excited about these tiny devices, or Apple’s general attitude, for that matter. They seem insistent on shattering the principles of anyone who believes in free choice and are intent on pissing people off by forcing them to install iTunes and its store on their computers. Somehow, however, they manage to stay away from a Microsoft-esque “evil corporation” image. I can’t even begin to fathom how they do it. Maybe it has to do with the fact they sell hardware and a design ethos rather than software.

Anyways, what I had my mind set on was a small laptop, 9-10 inches, that is always connected to the internet, and has a big enough keyboard. When the netbook market finally came along, with the lightweight, long-battery, 3G connected devices arrived, I thought I had reached Nirvana. No need to get a super-expensive ThinkPad X, Asus is giving me a product that’s not only a fraction of the price, but can run Linux!

What these compact computers don’t have, however, is a touch screen and don’t allow the user to “surf with a touch”. After being exposed to the touch-based interface and the various gestures that can be performed, I found myself on my couch, surfing the web with two fingers. My two desktop computers, one running XP and the other Ubuntu, complete with JBL speakers, 21” screens and a pair of orthopedic chairs, were left orphaned in the den. I, in the meanwhile, like the masses, am counting the days till the iPad comes along and I am hoping that the bigger touch-based keyboard of the iPad will indeed allow me to hammer out long texts.

After I’m done playing online, the next obvious step is downloading any and every israeli application written for the iPhone. I can’t help but think that if a few hundred thousand busy Israeli will leave their desktops, even for one hour, and while they’re standing in traffic or waiting in line at the post office, or even zoning out in front of the TV, and will start surfing through the iPhone and iPad, then the need for Israeli-oriented iPhone apps will skyrocket, apps that will replace the services previously offered through a plethora of websites.

Any self respecting organization will have to offer its iPhone users the same services offered to a desktop-surfer. They will have to write a matching iPhone application that will even have to surpass the website capabilities, and probably rework many of their website to support the iPhone format. All this future development activity is really interesting. Suddenly, developers will have new input devices, beyond the mouse and keyboard, to take advantage of. They will be able to make direct use of information coming from a camera, GPS, a compass and a ton of other sensors.

After realizing that I’m interested in getting up close and personal with the iPhone development community, I started playing around with some iPhone dev. tools and invited some like-minded people to start a blog about iPhone application development. Luckily, they agreed and so we are pleased to announce the launch of iPhoneInside.

Over the next few months, we will cover how to install an iPhone development environment (yes, it involves getting a new mac, or upgrading your old one, and a requires a $100 license – life with Apple may be pretty, but cheap or easy, it ain’t). We will also develop a StartUpMania iPhone application, and then tell you exactly how we did it – step by step, as well as interviews with the leading personnel in the Israeli iPhone development community. Lastly, we will provide news and coverage of all the latest iPhone happening from around the world.

Then the iPad will come along, and we’ll tackle that.

Translated by Itai Rosenbaum

StartUpMania recently found out that Sequoia Capital has decided to make a venture capital investment in Mintigo, a start-up founded by three former employees of Dov Moran’s Modu.

Gili Raanan, Sequoia’s newest partner, will be the fund’s liaison with the company. This is his first venture capital investment with the fund.

As previously mentioned on StartUpMania, Mintigo, founded in 2009 by the three Modu alumni Tal Segalov, former VP of development at Modu; Jacob Shama, former VP of product; and Tzahi Weisfeld, former VP of marketing and strategy.

Minitgo has already received a primary venture capital investment from Zohar Gilon and Menachem Sternberg.

The company, operating out of Hod HaSharon an New York, is developing a product that will collect Marketing Intelligence, and is aimed at retail giants, financial institutions and communication service providers. Lately, the company has been taking on many additional executives, among them Ehud Ben-Reuven, a former senior-architect at Check Point, who will be Mintigo’s CTO. Also joining is Iddo Drori, former R&D manager at Gizmoz and PrimeSense and Mintigo’s new research manager.

Translated by Itai Rosenbaum

Ariel Efrati, Vice President - Head of Amdocs Venture Investments, Product M&A unit

I am pleased to announce that Ariel Efrati, VP and head of Amdocs Venture Investments, Product M&A unit and the man behind all global Amdocs interaction with start-up companies, will be speaking at SmartPilot’s general assembly.

Efrati’s lecture will be called “Start-up Selection Process to the Amdocs Open Invitation Program”, and he will share with the attending computing managers his vast experience in working with IT start-ups.

Immediately following Efrati’s lecture, the Venture Capital panel will begin. Participating will be some of the most prominent IT investors in Israel, and we will discuss the future direction of IT projects, as well as the relationship between an IT start-up and a large organization’s computing manager.

To all who are planning to attend – I highly recommend arriving at 8:00 am to the reception. As you can see, our agenda is packed, and if you wish to take some time to network, the time slot between 8:00 and 9:00 is prime.

Translated by Itai Rosenbaum

I am pleased to announce that in the upcoming SmartPilot convention, I will moderate a panel that may prove to be quite interesting. The panel will consist of the top representatives of the Israeli venture capital industry, chiefly from those funds that invest in start-up companies.

On the panel will be Genesis’ Adi Shalev, Sequoia’s Gili Ra’anan, Gemini’s Daniel Cohen and Graylock’s Erez Ofer. All four are chief partners with a lot of experience in the global IT market. Many of the companies these four have invested in, will in fact be demoing at SmartPilot.

While preparing questions for the panel I nicknamed it with the codename “the XIV effect”, while not the official name of the panel, I am intrigued in finding out how important is a successful technological pilot in a large-scale organization is for a start-up looking for a successful exit.

I seem to recall the stories about the famous pilot held by the folks at XIV at Bank Leumi before they were purchased by IBM, or the pilot preformed by Onigma at Partner before they were purchased by McAfee. What I’d like to find out is the proper way to promote such a pilot – both for the start-up and for the organization incorporating the solution into their systems. I’ll try and discuss the optimal relationship between the start-up company and the organization’s IT managers, as well as the pros and cons an IT manager must consider before he starts such a pilot program.

Another topic, the one that will open the panel discussion, will focus on mapping future IT technologies and the future IT products the venture capital fund people believe they should invest in in upcoming years. These men have very particular information not available to analysts or IT managers, and we will try an define which IT fields no long hold any interest to them, which fields are “packed” with existing start-ups and which fields may disappear completely.

Of course, I’d be happy for active participation from the IT managers and start-up founders in attendance, and we will have microphones spread through the audience that will enable you to take part in the discussion right from your seat. The brave souls among you can take to the stage, so get those questions ready!

Translated by Itai Rosenbaum