Gizmoz is a small start-up offering an unusual service. It allows its customers to create their own avatars - virtual characters that enable consumers to put a unique face and voice to their digital communications. It struggled to survive during the hard times for Israeli hi-tech early in the decade. Now it can boast a $6.3 million investment by two major venture capital funds: Benchmark Capital and Columbia Capital. The funding will be put toward developing new products in the virtual field, and for expanding into global markets.

Gizmoz has seen some rough times in the past years. It completed four previous financing rounds, which have brought it about $25 million since its inception in the early 1990s. Its investors included such giants as AOL, Fujitsu, Chase Manhattan Bank, 1800flowers.com and Pitango Venture Capital.

	Advertisement

Eyal Gever founded the company in 1993, under the name Zapa Digital Arts. He was then joined by Sefi Visiger, Arik Vardi and Yair Goldfinger. During its zenith, the company employed a staff of 65. In 2001, the company was rocked by a round of layoffs, firing dozens of employees. Now it aims to provide services for companies such as Habbo Hotel, which enjoy a turnover of $100 million from selling avatar accessories.

In its earlier days, Zapa offered the service of packaging multimedia into one suit, which it called "gizmo." This virtual product could then be sent through the Internet as a digital greeting card. "Zapa was actually the inventor of what later became known as 'widgets.' The packaging had to be done in Java back then, as Flash didn't exist," Gever recalls.

In early 2002, following 9/11, the Internet-affiliated industry ground to a halt. "I suggested to the board to buy the intellectual property and then set up a new company. AOL and Vivendi were supposed to buy us. Bertelsmann Media Worldwide was also a potential buyer." Gever bought the company from Australia's Lieberman family, who believed in his vision. They subsequently invested $3.5 million in the new company, Gizmoz.

At present, Gizmoz is engaged in developing various avatars and animated characters for consumers surfing the Web. Gizmoz technology allows the avatars to move their virtual lips in sync with the speaker's voice, and change their facial expressions. People can create an avatar from their own passport pictures, or select an avatar from the Gizmoz online library.