Remember My Name: 20 Israeli Startups to Look Out For

TheMarker’s tech writers profiled 20 startups they believe are particularly promising; companies with a product, a clear business model and a vision of solving a pressing problem. Keep your eye on these guys.

Cellrox: Smartphones with split personalities

Nowadays smartphones serve as both a business tool and as personal devices for storing photos and playing games. The result is a constant battle between the organization’s IT department, which wants full control over the phone’s access privileges, and the employee, who wants unrestricted use.

Cellrox allows two personas − private and business − on a single Android smartphone, separated by an impregnable virtual wall.

“In an organization like Morgan Stanley, everyone walks around with two mobile devices: a BlackBerry for corporate applications and an iPhone for Waze, Angry Birds and everything that makes life easier,” says Cellrox CEO Omer Eiferman. “This makes no sense.” With Cellrox, the IT people have the control and security they want while the user gets to enjoy his privacy.

Cellrox’s customers include Fortune 500 companies such as major investment banks, which compared competing services and ended up going with the tiny firm from Ramat Hahayal. Cellrox offered an elegant solution to a real problem, one that’s become even more pertinent as the BYOD ‏(bring your own device‏) trend gains steam and more people start using their own personal devices in the workplace.

Founded in 2011, Cellrox now has 15 employees. So far it has raised $6.2 million in two rounds of funding from investors including Runa Capital, Previz Ventures and Columbia Technology Ventures. ‏(Amitai Ziv‏)

Autotalks: Will honking your horn become obsolete?

Vehicle-to-vehicle communication systems that enable cars to “talk” to one another are poised to become the next craze in auto technology and road safety. For instance, such a system could warn that a driver ahead of you just slammed on his brakes and could give you the split-second warning needed to avoid a collision.

“There’s still no market for systems like these and car companies are deciding with whom they should work,” says Menashe Ezra, managing partner of Gemini Israel Ventures. But industrial information and research company IHS believes that more than 1.3 million cars worldwide will be outfitted with V2V-based systems within five years and that 30% of all new cars will come with them 10 years from now.

Although carmakers would need to adopt a universal standard to unlock the full potential of V2V communications, Autotalks is set to roll out its chipsets, which analyze data transmitted by the computers of nearby vehicles in order to warn drivers of any imminent danger. The company is well-positioned at the starting gate, having already won preliminary contracts with several European automakers.

Started in 2008, the company is headed by co-founder Nir Sasson and has 32 employees. By the end of 2012, it had secured $5.5 million in backing from Magma Venture Partners and Japan’s Mitsui Global Investment, as well as Gemini. ‏(Orr Hirschauge‏)

LightCyber: Rapid detection of cyber intruders

Don’t let the geeky name put you off. LightCyber is part of a select club of local cyber security companies that are developing novel solutions for protecting corporate data. For the past few decades, companies protected themselves by setting up firewalls to keep out alien software. It is now recognized that every wall can be breached, necessitating new ways to protect internal networks.

LightCyber’s software analyzes communication patterns within the organization and looks for anomalies. This enables it to detect intruders even without specifically identification harmful software. In contrast to other companies such as Israel’s Imperva, LightCyber does not attempt to decipher the invader’s logic − it doesn’t try to figure out if it’s targeting the organization’s applications or database.

Founded in 2011 by CEO Giora Engel and CTO Michael Mumcuoglu, LightCyber launched its first product several months ago. Its paying customers include Bezeq. The company has raised $1.5 million so far from Glilot Capital Partners, and intends to launch U.S. operations in the near future. ‏(Orr Hirschauge‏)

Fiverr: Anything for a fin

Aspiring to become the eBay for services, the website Fiverr offers a potpourri of offbeat services: You can get an original birthday greeting in an exotic language, 50 “likes” on Facebook within 24 hours, an itinerary for a backpacking trip through Europe, to name just a few.

At first, almost every service advertised on the site was priced at $5 − hence the name − with the company taking a $1 commission on each transaction. Now nearly half the services cost more, with prices ranging up to $500.

“Fiverr wants to be the place where people turn their talents into money,” says CEO Micha Kaufman, who started the company with Shai Wininger in 2010. “For example, if I live near the Eiffel Tower I could send a picture of it 900 times a day if people want. Everything can be turned into a business, and the beauty is that the website speaks to everyone.”

Last May fiverr completed its third financing round for $15 million from Accel Partners and Bessemer Venture Partners, funds that have also backed Facebook, LinkedIn and Spotify. This raised the total invested in the company to $20 million. With 65 employees ‏(50 at its Binyamina headquarters‏), Fiverr has opened a new office in New York. In the past year, the number of services listed on the website leaped from 750,000 to 1.2 million. ‏(Inbal Orpaz‏)

Hola: Making web surfing smarter and faster

The Internet may have rapidly gained global acceptance, but one aspect of it hasn’t changed much: its architecture. Information is split up into small packets of binary data that often traverse vast distances before recombining into a coherent message that your PC can understand. This is something Hola is intent on changing.

When users download the company’s software, they let other users use part of their computer’s idle processing capacity and memory in return for an improved Internet experience. Who says you need to surf the web via your Internet service provider? Why pull data from the other side of the world when your neighbor just visited the site you want and the data is stored in his computer’s memory? Hola also allows access to websites like Netflix and Hulu that block their content from being viewed in Israel.

Founded in 2008, the company has 14 employees and is headed by is a pair of experienced entrepreneurs with a huge vision, CEO Ofer Vilenski and CTO Derry Shribman. The premise is that even if the company has no revenue over the short term, it is is assured a profit windfall when it reaches a critical mass of users. Meanwhile Hola has raised $18 million, earning a vote of confidence from a range of leading funds including Li Ka-shing’s Horizon Ventures, Magma Venture Partners, DFJ and Tamir Fishman. ‏(Inbal Orpaz‏)

WaveGuard: Monitoring an industrial hot potato

There are already 25,000 telecommunication transmission antennas installed throughout Israel, even as experts continue to debate how dangerous their radiation is. Emission limits have been set based on international standards, but the Environmental Protection Ministry does not monitor constantly for violations. Every site is checked upon installation and then only once a year.

WaveGuard Technologies’ system monitors radiation in real time based on data from cellular network operators on their power usage and transmission traffic. Its flagship product, Guardian Government, is marketed to governments and local authorities. After its first customer − Israel’s Environmental Protection Ministry − started to use the system in 2011, it found that 8% of all antennas exceeded their emissions limits. Another product, Guardian Operator, is geared toward mobile communications operators.

Co-founder and CEO David Shaul came with 20 years of experience in the telecom industry with companies such as Gilat Communications, Motorola and Partner Communications. Established in 2009, WaveGuard has 10 employees and is backed by $1.5 million secured from private investors. ‏(Amitai Ziv‏)

eyeSight: Control your car by pointing

This year’s International Consumer Electronics Show in Las Vegas was abuzz over trendy new ways to control anything from television sets to computers and smartphones, including cars. One way was voice activation, while another technique developed by eyeSight uses motion detection to get gadgets to respond to natural gestures. This means you can control your electronic devices with the point of a finger or the wave of a hand.

Several other Israeli firms are developing similar technology in the realm of natural user interface ‏(NUI‏), including PrimeSense, XTR Extreme Reality and PointGrab, but currently eyeSight’s system is the most widely used by global electronics companies. The company’s technology was featured in products made by 12 companies that were on display at the CES, including the Chinese computer maker Lenovo, television manufacturer Hisense, and mobile phone producer ZTE. Most recently eyeSight signed a contract to integrate its software into AMD computer processors.

Founded in 2005, eyeSight has 32 employees and is headed by CEO Gideon Shmuel. The company has raised $10 million in two rounds from Japan’s Mitsui Global Investment, CEVA and the Korean-Israeli MaC Fund, as well as from several angel investors including Eli Talmor. ‏(Amitai Ziv‏)

Parallel Universe: Tracking millions of objects in real time

Of all the companies presented here, this is the least ripe one. It operates from the home of founder and CEO Ron Pressler, has only three employees, including Pressler and his sister Dafna. So far, it has raised only several hundred thousand dollars. Nevertheless, its innovations are very promising: It was the first Israel company to be included in the prestigious Silicon Valley seed accelerator program Y Combinator.

The company develops databases using software that Pressler developed for the Israel Air Force. The software can simultaneously track the location of hundreds of thousands of different objects. The company is now developing a civilian version of this software, which would allow, for example, the tracking of millions of vehicles that appear on GPS maps or hundreds of thousands of gamers in virtual worlds such as World of Warcraft. Parallel Universe’s database is designed to allow information mining in real time, from constantly updated networks.

Founded in 2012, Parallel Universe has raised $350,000 so far from a combination of VC funds, angel investors Ron Conway and Yuri Milner, and other private investors. ‏(Orr Hirschauge‏)

Jinni: Your personal movie search engine

Couch potatoes never had it so good, or so tough: In today’s world of VOD and Netflix, how can anyone choose between the thousands of movies and television programs available at the press of a button?

This is where Jinni steps in. The company came up with a system that makes recommendations to viewers based on what they’ve enjoyed watching previously. It can also respond to a simply phrased query like “I want to see a romantic comedy but I’m tired of Woody Allen.”

Jinni’s client base is multichannel services like HOT and Yes, as well as over-the-top ‏(OTT‏) Internet content suppliers such as Netflix or Amazon. At the latest Consumer Electronics Show in Las Vegas, Jinni disclosed an impressive list of customers that signed contracts with it in the last quarter of 2012: Time Warner Cable, Walmart’s Internet-connected TV business, Vudu, France’s Buoygues Telecom, and Singapore’s SingTel, to name but a handful.

Jinni also has cooperative arrangements with relatively new players in the field. Microsoft has integrated Jinni technology into Xbox game consoles that can also be used for viewing video content. Jinni also partnered with Google in developing Google TV.

Founded in 2007 by CEO Yosi Glick and CTO Izik Ben-Zaken, it now employs 30 people. The company has raised $7.5 million from DFJ Tamir Fishman, Belgian cable company Belgacom and Korean TV manufacturer LG. ‏(Inbal Orpaz‏)

Pentalum: Getting the most out of wind power

Rehovot-based Pentalum developed a new way to measure wind direction and speed for the wind power industry at just 20% the cost of existing methods. The system emits laser beams to heights of 30 to 200 meters and bases its calculations on the light reflected by airborne particles.

Founded in 2009 by its VP R&D Nathan Sela and CEO Sagie Tsadka ‏(early graduates of the Israel Defense Forces’ Talpiot training program‏), the company got its start with pre-seed financing from venture capital firm Cedar Fund.

“Annual sales for wind turbines currently amount to roughly $40 billion,” says Gal Israely, a partner at Cedar. “Accurate measurements boost the turbines’ efficiency and reduce their wear and tear. If the company’s measuring equipment can improve the turbines’ performance by 5% to 10%, this would be worth $2 billion to $4 billion. For us, this means the potential for hundreds of millions of dollars in sales.”

Revenue has begun to roll in. When it debuted last year, Pentalum sold 50 of its systems for a total of several million dollars. Over the past decade, the wind energy industry has grown at a brisk 25% annual clip and is expected to continue growing at a similar pace for years.
Employing a staff of 37, Pentalum has now raised a total of $16 million in investment. In addition to Cedar, its backers include Evergreen, DFJ and ABB Technology Ventures. ‏(Orr Hirschauge‏)

Vayyar Imaging: An alternative to mammograms

Breast cancer is the world’s most widespread form of cancer among women, and the earlier it’s diagnosed, the better the odds. The primary diagnostic method currently available is mammography, which benefits mainly women over age 50 and requires expensive equipment generally available only at hospitals.

Vayyar Imaging, however, is developing a chip to enable the early detection of breast cancer through radio frequency ‏(RF‏) technology. The system can better spot signs of cancer in younger women, and since the equipment is both less costly and portable, it is particularly well-suited for use at smaller clinics and by doctors in developing countries.

The company was founded in 2010 by CEO Raviv Melamed, formerly vice-president of Intel Israel’s wireless division, and by CTO Naftali Chayat, who was chief scientist at Alvarion. The two were soon joined by Miri Ratner, one of the chief engineers at Breezecom.

Vayyar Imaging recently won funding from the BIRD Foundation to launch a joint venture with U.S.-based medical instrument manufacturer Agilent Technologies. Tight-lipped about its operations, the company has secured $12 million in funding from Battery Ventures, Bessemer Venture Partners and Israel Cleantech Ventures. ‏(Orr Hirschauge‏)

AppsFlyer: make your ads worth the money

AppsFlyer is a perfect example of a company relying on new venture capital models. It started as part of the Tel Aviv Municipality’s Hasifriya initiative, which fosters new technology companies, and then benefited from Genesis Fund and Microsoft’s accelerator program. AppsFlyer’s system allows companies that develop mobile applications, such as the Japanese company SEGA and the Israeli GetTaxi, to gather information about the extent and efficiency of advertising campaigns on different mobile device advertising platforms. By incorporating AppsFlyer software into their applications, advertisers obtain information that breaks revenues down to specific users. They can also track use of the application over time. For example, the software distinguishes between users who found the application through Facebook versus those who found it via a banner embedded in a game.

Operating in the relatively new field of tracking advertising campaigns on mobile devices, AppsFlyer has just signed a deal with Facebook that will allow the social networking giant to track its apps marketing. AppsFlyer was founded in 2011 by CEO Oren Kaniel and CTO Reshef Mann. In 2012, it raised hundreds of thousands of dollars from Magma, an Israeli venture capital firm. ‏(Orr Hirschauge‏)

iOnRoad: For knowing when to keep your distance

Like Waze, iOnRoad shows how an Israeli company can create a smartphone app based on heavy technology and provide real value to its users. The company’s application uses the phone camera to analyze road conditions and hazards in the car’s vicinity, warning the driver of potential danger. This can be particularly handy when changing lanes or tailgating.

Founded in 2012, the company employs seven people and is headed by Alon Atsmon, its CEO and co-founder. The app, also launched in 2012, already has had 1 million downloads. iOnRoad is now planning to join up with insurance companies to offer users discounted premiums based on their driving habits as reported by the app.

The company’s excellent positioning in software-based driver assistance systems could help it attain a significant role in this growing market. Since the app is on the smartphone and not the car’s computer, it doesn’t need to be configured for various non-standardized hardware systems, making it particularly competitive. So far iOnRoad has raised about $1 million from angel investors. ‏(Orr Hirschauge‏)

Newvem: Saving you on your cloud services

Services on the cloud are not part of the future − they’re already here. Startups and organizations across the world are using the cloud services of companies such as Amazon, Microsoft and Rackspace to obtain computing and storage services on a pay-for-use basis.

But the ease of purchasing and using these services is creating new management problems. While forgetting to turn off the lights at home won’t cost you too much, renting extra servers from Amazon could cost you a bundle. Newvem monitors and analyzes cloud server usage patterns, thus streamlining the use of this expensive resource. Newvem’s package, called KnowYourCloud, analyzes customers’ usage of Amazon Web Services and lets them know where they’re being inefficient. It also highlights potential problems, such as unused servers, security issues or excess demand that could cause a server to collapse. Their software can save users 30% on cloud service costs on weekdays and 50% on weekends, the company says.

Founded in 2011 by CEO Zev Laderman and CTO Ilan Naslavsky, the Tel Aviv-based company has 25 workers. It has raised $4 million in financing and its backers include Greylock Partners, Index Ventures and Eric Schmidt’s Innovation Endeavors. ‏(Orr Hirschauge‏)

DudaMobile: Whip up your own website

The growing use of smartphones means there’s an increasing need to adapt existing websites to small screens. DudaMobile co-founders CEO Itai Sadan and CTO Amir Glatt identified this problem in 2008, shortly after the first smartphone hit the market.

“It was clearly revolutionary,” Glatt told TheMarker. “We recognized that giants like Amazon were investing in improving user experience while using mobile devices. However, trying to find a local restaurant’s website on a cell phone was not a user-friendly experience. We therefore set out to develop a way for small businesses to provide an easily accessible and pleasant experience for users visiting websites via their mobile devices.”

DudaMobile developed a platform for creating websites that are accessible through smartphones and tablets. It does not not require software knowledge, so small businesses can easily produce their own sites. The system is also sophisticated enough to be used by professional website developers.

DudaMobile is operating in a competitive and saturated field that includes several Israeli start-ups such as Cellerium, Zuznow and Conduit Mobile. However, DudaMobile has established itself through strategic partnerships with leading players in the Internet world. Google’s GoMo initiative, designed to adapt commercial websites to mobile devices, is based on DudaMobile software. So far, 60,000 websites have been designed under GoMo. Another 800,000 sites have been designed via DudaMobile’s partnership with web hosting company GoDaddy. Other partners include restaurant guide Open Table and Yahoo’s Small Business service.

To date, 3.2 million mobile websites have been created using DudaMobile, up from only 100,000 a year ago. It has 50 employees, twice what it had a year ago, and its customer base is growing by 20%-30% each month. Over the next year, it intends to release a new version better suited to tablet users. DudaMobile raised $6 million last year, mainly through Pitango Venture Capital. Its revenues grew 300% in 2012. ‏(Inbal Orpaz‏)

Tvinci: TV for the future, from a mountaintop

Tvinci was born on a mountaintop in Guatemala, where founders Ido Wiesenberg and Ofer Shayo met and realized they had similar ideas. Since its inception in 2007, Tvinci has become a major player in the global TV world. Tvinci operates in the hot field of OTT ‏(over the top content‏) − online TV broadcasting. In Israel, mobile providers Partner and Cellcom are setting up TV services to compete with multichannel television providers HOT and Yes.

Tvinci’s platform is designed for communications providers and media companies, allowing them to provide TV services using technology already in service and broadcasting content to anyone with a TV, smartphone or tablet. All the media companies have to do is buy and market the content.

“We’re building the engine for the television of the future, which will be able to identify viewers through their smartphones and make viewing recommendations based on what their friends watched,” Wiesenberg says. Tvinci customers are companies entering the OTT field, media companies, or traditional cable and satellite companies wishing to broadcast to news outlets.

“The customers are split 50-50 between traditional providers and media companies,” explains Wiesenberg. “Some satellite companies believe they’ll be replaced by Internet broadcasts, and others want to start with TV everywhere and see where things develop.”

In 2012, the company “acquired seven big clients, and another new big one early in 2013. From 19 employees, we’ve grown to 60,” says Shayo. Tvinci is operating in a crowded field along with other Israeli players such as RayV, Comigo, vidmind and others. Its advantage lies in its having being around longer and its large customers. In 2012, Tvinci raised $4.5 million in a second financing round, and analysts predict further growth this year. ‏(Amitai Ziv‏)

ClickTale: know your site’s visitors

A major challenge for website managers is finding ways to increase their conversion rate − the number of active visitors. ClickTale’s technology analyzes a website’s visitors by measuring clicks, mouse movements and web page scrolling. This data, in the hands of a website’s manager, can greatly assist in improving conversion rates and thus enhancing advertising revenues. The company’s customers now include more than 80,000 sites, including leading brands such as Dell, Procter & Gamble, Barnes & Noble and LinkedIn.

ClickTale is riding one of the hottest trends in the tech world, known as customer experience analysis. Their technology enables analyzing vast amounts of data ‏(Big Data‏). ClickTale sells its software services online ‏(Software as a Service‏) and also provides web analytics for its customers. Founded in 2007 by Tal Schwartz and Arik Yavilevich, the company has raised $800,000 so far. It started turning a profit in 2009, with annual revenues topping $10 million and growing at a pace of more than 50% a year. Its owners hope to make an IPO within three years, but might need to raise more capital to prepare for this. ‏(Inbal Orpaz‏)

TLVMedia: Smart algorithms for monetizing ads

Alongside cyber security, chips and communications technology, the last decade has seen the growth of a cluster of local companies dealing in online advertising. TLVMedia, established in 2008, is one of the promising newcomers in a field that includes Kenshoo, Outbrain and Matomi. TLVMedia, which had only seven employees two years ago, now runs a vast advertising enterprise with 15 billion impressions ‏(the number of times an ad has been shown to site visitors‏) each month, and is doubling its revenues every year. Its uniqueness lies in the smart algorithms it uses to optimize cost and efficiency in the online advertising marketplace, similar to algorithms used by Google, Yahoo and Appnexus. With offices in Tel Aviv, the company now employs 27 and is headed by CEO Ohad Gliksman. It has not raised any outside financing. ‏(Orr Hirschauge‏)

StartApp: Helping developers turn a profit

StartApp’s business model is similar to Conduit’s, but for the world of mobile devices. Their customers are not smartphone users but rather apps developers who might incorporate StartApp code into their applications. When users install an app that contains StartApp’s code, it changes the search engine installed on their device to one selected by StartApp. The company then shares advertising revenues from the search engine providers with the app developers.

Everyone profits except the naive user. The number of installed applications using StartApp software has more than doubled in the last six months. This isn’t an unusual growth rate for a startup, but in this case it means that more than 150 million installations took place. Overall, apps using StartApp have been installed more than 350 million times, and it has become one of the major revenue-generating vehicles for mobile app developers.

As opposed to many other companies, StartApp has no technology that cannot be replicated, but its meteoric growth, sound business model and professional managerial team make it one of the safest bets in this area. Founded in 2010, the company has 20 employees and is headed by its co-founders, CEO Gil Dudkiewicz and CTO Ran Avidan. It has raised $5.5 million from seed investor Cedar Fund and Ascent Venture Partners. ‏ (Orr Hirschauge‏)

ScaleIO: Storing your data for less

Data storage is an area in which Israel has considerable expertise. Dozens of local startups working in this field have been sold to global giants over the last decade for impressive sums. One example is Topio, sold in 2006 to NetApp for $120 million. Its founders have now created ScaleIO, which allows organizations to disperse their data storage across multiple servers. This enables the rapid and efficient data retrieval without the need for any new hardware.

Company officials say their products can save up to 80%-90% in storage costs, compared to comparable systems offered by IBM, EMC and HDS. ScaleIO’s customers include giants such as SAP, Check Point and COLT, which supplies website hosting via 23 servers spread across Europe. ScaleIO has raised substantial capital, reflecting investor confidence in the company’s experienced founders and the ongoing need to cut sharply rising storage costs. ‏(Orr Hirschauge‏)