GreenIQ Ltd., HopOn Ltd., and Zeekit Ltd. won Israel's Smartup2 competition. They were chosen from ten start-ups in the competition hosted by "Globes" and Bank Hapoalim (TASE: POLI). "Globes" editor in chief Hagay Golan announced the three winners, saying, "This is the second time that we are hosting the Smartup competition with Bank Hapoalim. Our own industry has been in a changing environment in recent years. We want our content to reach as many people as possible and we need a business model to let us live."
During the program, "Globes" correspondents will follow the three companies, which will receive assistance from incubator experts and Bank Hapoalim advisers, on the basis of the realization that many companies with good breakthrough ideas face difficulties in their early stages that prevent them from realizing their potential. The program is designed for Israeli companies that have already raised at least NIS 250,000 in their first financing round.
The companies will receive a start-up package from Bank Hapoalim that includes a high-tech account at preferential terms and a NIS 20,000 grant. The three winners will receive advice from executives at Explore.Dream.Discover, Nielsen Innovate, and EISP 8200.
The starts-ups were picked by the judges: EISP 8200 program manager Yinon Glasner, Explore.Dream.Discover CEO Duby Lachovitz, Nielseon Innovate CEO Esther Barak-Landes, Poalim Capital Markets managing investments principle investments Eran Gersht, Bank Hapoalim Fintech program manager Yael Weisbourd, Bank Hapoalim CTO lead technology architect Tsachi Lutaty, and "Globes" Internet and digital correspondent Roy Goldenberg.
Nearly at the finish line
In addition to the three winners, there were several other finalists with products that were just as good. Coralogix Ltd. uses past surveys to predict the crash of products installed at customers. This streamlines customer service at low costs. Coralogix co-founder and CEO Guy Kroupp says, "We learn the system's normal conduct and then we can predict problems."
Pixtr Ltd. is an app for smartphones which uses patented algorithms to automatically installs a picture while identifying the images and faces to maximize its potential. "We do the photogenes for you," says co-founder Yaron Richer. "It's an automatic editor in the user's pocket. We use algorithms to understand who everyone in the picture is, and we also understand the beauty. We want to the Adobe of smartphones."
The app can be downloaded for iPhones and is planned for Android devices.
Klike Tune Ltd. offers a wearable computer keyboard for smart glasses and television. The keyboard is operated by a touch screen using hand gestures in the air or by a miniature manual keyboard. The solution is for the blind and visually impaired for both inserting a recording and navigating within and between apps.
iClass Ltd. is an online educational platform customized for each pupil. It can save all textbooks in one place and work with digital companies together with the teachers and pupils. The platform is already installed at 300 schools. The company says that Microsoft has chosen the solution for Israel and other countries.
Famuza Ltd. is a crowdsourcing platform for predicting fashion demand. It allows anyone to create, market, and sell items of clothing and also identifies whether there will be demand for starting production.
4id Ltd. has created an online educational environment for users with special needs. Games are customized for people with autism, mentally retardation, or restricted motor skills.
RevenueStream Ltd. has developed an online credit card fraud detection system. It offers a yes/no response to an order, offering a business absolute assurance of the value of the goods sold without concern about loss of costs or fines, While providing operational cost savings.
Banks want agility "Banking is a heavy industry, the opposite of agile start-ups," said Bank Hapoalim VP head of corporate strategy Dr. Ron Weksler. "The bank is a big ship, and to move one degree you have to turn the wheel 16 times. We want to move fast. To do so, two years ago, we invested in the fintech program.
"The choice of the ten finalists in the competition was challenging in view of the many innovative and creative start-ups that submitted their candidacy this year. The range and quality of ideas, combined with the entrepreneurs' wealth of experience, reflect the strong potential and capabilities in Israel's technology entrepreneurship."
"Bank Hapoalim is dealing with rapid technological developments which have changed consumer behavior and increased competition in the financial industry. One of the ways to deal with these changes and stay up-to-date and relevant is to link banking with the breakthrough start-up industry. Bank Hapoalim was the first bank in Israel to lead this trend, launching its fintech program two years ago. The program's objective is create a link between the bank and start-ups, expose the bank to outside innovation, and to install innovative financial technologies as part of the offer of value to the customer. Bank Hapoalim sees primary importance in promoting high-tech companies and is committed to investment its utmost in foster the high-tech industry. The small business sector is an important growth engine of the economy."
"140 high tech and life sciences companies are listed on the TASE, and TASE makes every effort to promote high-tech companies," says Tel Aviv Stock Exchange (TASE) SVP head of economic department Hani Shitrit-Bach. "The committee to promote public investment in R&D companies recommended several solutions to help start-ups. The most important of them are establishing public venture capital funds to invest in private start-ups and establishing two non-TASE financing channels through crowdfunding and sophisticated investor clubs. We want the public to invest in high tech. we're at the start of legislation for a trust fund that any individual can invest in."
As for crowdfunding, Shitrit-Bach says, "Until now, a company seeking to approach the general public to offer shares online could not do so because it was illegal in Israel. We're in a legislative process to allow crowdfunding of up to NIS 2 million a year, and we hope that this will cause the public to invest in start-ups."
"Globes" editor-in-chief Hagay Golan: Even though we are the 'Start-up Nation,' there is the question why there is a feeling of a missed opportunity.
Aviv Venture Capital managing partner and Israel Advanced Technology Industries (IATI) co-chairman Yoav Chelouche: "As Jews, we're never satisfied. Companies come to Israel to replicate the Israeli miracle. Last year was a record year for exits, amounting to $7 billion." < P>How do you break the glass ceiling?
"You should look at the whole picture, see where the barriers are and take them down. The number of engineering graduates in both Israel and the US is falling. Money is lacking, but opportunities are not. The three components should be linked: money, education, and the connection between the government and private sector, such as the Chief Scientist."
Why are companies struggling to raise capital?
"There is an odd phenomenon of many start-ups, but the money mainly comes from American venture capital funds. After the seed stage, there is a shortage of money. Pension funds have NIS 1 trillion, but they don’t invest in high tech. You need to cause pension money to invest in this industry too.
Do banks want to invest in start-ups?
"Lately, Bank Hapoalim and Bank Leumi (TASE: LUMI) have made announcements. We see a greater willingness to cooperate."
Should a company make an exit or exist independently?
"Not every company can survive independently forever. When it receives an acquisition offer, the entrepreneurs know they have a mortgage to pay at home, and this influences them. The moment a company is acquired by a foreign company, it might continue to function in Israel, but its fate is in other people's hands. I think that if we made exits a little more slowly that would be better."
Which sectors do you believe in for the coming years?
"The sector facing a huge revolution, and in which I think Israel has an opportunity, is digital medicine. Israel has the best medical databases. The world is going to invest in healthcare in order to improve the quality of life.
"The second field is education. There is a lot of investment in this sector in Israel, and it's a very big field worldwide. The gap between current technologies and the potential is infinite. Israel will not solve its education problems just by reducing class size."
HopOn has developed an app to use smartphones to pay for public transport. Buses participating in the company's pilot have a special transmitter above the driver, which transmits an ultrasonic frequency that includes a special code for the bus. The passenger activates the app, which identifies the route, station, and bus number in less than a second. There is no need for contact with the driver. The app can handle multiline, monthly, and other cards. Later, it will be possible to use the app to purchase tickets. "Our technology is next stage in tickets," says HopOn founder David Mezuman. "The advantages of the technology are that it can be used without going to the driver and with no queues. Public transportation companies save on the production of tickets and queues by the driver."
GreenIQ has developed a smart garden computer connected to the Internet via the home wireless network to automatically update weather data and forecasts to build and carry out a water-saving lawn irrigation plan that can half up to half of a home's water consumption. It also controls the garden's lighting on the basis of sunrise and sunset.
A family wastes NIS 1,200 a year on water," says GreenIQ founder and CEO Odi Dahan. "Contemporary irrigation systems are very obsolete. They are difficult to plan and are oblivious of the weather, so they constantly irrigate."
The product costs $200.
Zeekit seeks to change the online clothing shopping experience with a platform that can photograph a person, and virtually fit clothes on him or her. "Online stores haven’t changed in 15 years," says Zeekit CEO Yael Vizel. "At Zeekit, we decided to offer a solution. A person takes a selfie with an ordinary camera, writes the event for which he wants the clothes, such as a job interview, and the system searches the clothing for him all across the Internet. At the end of the process, the system suggests the suitable clothes and other items."
The user sees the final selection on his picture, as if he were wearing them. "We've already declined an acquisition offer. We want to grow," says Vizel. "There are a lot of companies trying to work in this field. There are companies that propose self-scanning by smartphone and the business has to create a 3D model of the clothing. Customers aren’t used to seeing themselves as an avatar. We, on the other hand, use 2D, and people are already used to seeing themselves in 2D in Facebook pictures, and we succeed with 2D in dealing with this."
Published by Globes [online], Israel business news - www.globes-online.com - on June 16, 2014
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