Tech Roundup / Waze wows 20 million app users
Five major Israeli venture funds announce plans to raise new funds before end of the year.
* Waze reaches 20 million users: The Israeli-born navigation app Waze reached 20 million users this past week, four years after the start-up's establishment. More impressive, half of those users joined the app in just the past six months. Waze users have navigated 5.1 billion kilometers using its application, the company says. Last month, Waze launched a new feature that allows users to compare gas prices in the driver's vicinity. The feature, which uses crowd-sourcing technology and is available in the United Stated and Israel, also allows users to filter results by type of gasoline, brand name, full or self-service and distance from automobile.
* Israelis less productive: Despite the success of Israeli start-ups, new figures recently released cast doubts on high-tech's ability to serve as a growth driver for the Israeli economy. According to the Industry, Trade, and Labor Ministry's Office of the Chief Scientist, Israeli high-tech workers are 20 percent less productive than their American counterparts. The figures were based on equipment manufacturing data taken from the areas of electronics, communications, quality control and assurance, and medical and scientific equipment. However, the survey did not include data from multinational corporations that operate in Israel, such as Google and Intel, which employ 44 percent of Israeli high-tech workers.
In light of the discouraging findings, Chief Scientist Avi Hasson established a new committee led by Prof. Zvi Eckstein, former deputy governor of the Bank of Israel, to examine the reasons for the productivity gap, its implications, and ways to reduce the gap in all branches of the high-tech industry. The committee includes representatives from the Central Bureau of Statistics, the Bank of Israel, the Industry, Trade, and Labor Ministry, the Finance Ministry and the Manufacturer's Association of Israel.
According to Eckstein, the productivity gap stems from cuts in government funding to the Office of the Chief Scientist as well as reduced investment in research and development in Israel.
* Venture capital announces funding goals: Five major Israeli venture funds announced their plans to raise another round of capital before the end of the fiscal year. Pitango is aiming for $350 million, a smaller target than in the past. Magma Venture Partners, Qumra Capital and Israel Cleantech Ventures are all shooting for $100 million apiece. Finally, Vertex Venture Capital announced the opening of a new fund with a first round investment target of $150 million.
Israeli venture funds are having difficulty raising additional funds these days, a problem they share with their counterparts across the globe. The main cause has been a decade characterized by low investment returns, during which venture capital funds found it hard to overcome their losses from the end of the dot-com bubble. The European economic crisis and the recovery from the sub-prime mortgage fiasco in the U.S. have only added to the difficulty.
The high-tech lobby in the Knesset, led by MK Robert Ilatov (Yisrael Beiteinu), during its annual gathering last week, discussed an initiative to establish a cyber-warfare technology park in Dimona. Foreign Minister Avigdor Lieberman will present a budget proposal of NIS 330 million to open a university branch there that will focus on cyber-warfare. The program is intended to encourage young Israelis with cyber-related credentials to study and work in the Negev.
* Palo Alto to float on Wall Street: Palo Alto Networks, the U.S. information security company founded by Nir Zuk, one of the Israeli co-founders of Checkpoint, will be holding its initial public offering on the New York Stock Exchange with an expected market value of $2.1 billion - $2.5 billion. The stock offering will be underwritten by the investment bank Morgan Stanley along with Goldman Sachs and Citigroup.
* FiftyOne raises $10 million: Israeli tech company FiftyOne, which provides information management systems for Internet retail sites, has raised $10.1 million.The company enables shoppers from around the world to browse U.S. retail websites, see prices in local currencies, and pay by methods commonly accepted in their home country. For their retail clients, FiftyOne also handles processing and shipping. FiftyOne was founded in Tel Aviv in 1999 by Yuval Tal, Ofer Komem and Miki Ishai.