Israel doing big things with nano-materialsIsraeli scientists are making significant contributions to the advance of nano-technology, discovering and developing some of the most important breakthroughs.26 Oct 2010Applied Nanotech, one of the many companies presenting new products at the International Nanotechnology Conference, will highlight its nano-based copper ink technology. By David HaleviIsraeli high-tech has done some big things in the past - creating some of the most important advances in computer security and networking, social media, and telecommunications. Today, Israeli companies are set to do some little things - which may have an even bigger impact than some of those high-tech achievements.What Internet startups were to the past decade, nanotechnology will be to the next one, experts say - and Israel is already a world leader in development and deployment of applications based on this new science. Already, Israeli scientists have made significant contributions to the field, discovering and developing some of the most important breakthroughs.Among the applications Israeli start-ups have developed using nanotech are water purification membranes, agents for oral drug delivery, inkjet digital printing systems, diagnostic tools, holographic storage systems - and an 'e-beam on a chip,' which is similar to a laser beam, to be used for semiconductor manufacturing.Thanks to nanotech, for example, organ transplants may become a thing of the past, as special growth factors based on nanotechnology help grow healthy cells in an organ to replace unhealthy ones. Nanotechnology could also help to vastly reduce pollutants from internal combustion engines and could even develop elements that provide the taste of sugar in foods, without the calories and tooth decay that are part and parcel of the product today.The nanotechnology revolution is here, and moving forward rapidly, with a host of Israeli companies already producing applications based on this new science, which allows researchers to control matter on an atomic and molecular scale.Highlighting Israel's nano-accomplishmentsHighlighting Israel's accomplishments and research in the emerging nanotech field, the second annual International Nanotechnology Conference will be held in Tel Aviv in November. It will focus on innovations and business opportunities in the energy, water, environment, nano-material, nano-electronics, nano-photonics, nano-bio and nano-medicine fields.Investors seeking opportunities and companies from Israel and abroad will attend, showing off their nano-wares. Speakers will include the leading lights of the discipline from Israel and abroad. Among them will be the 2010 co-winner of the Nobel Prize for Physics, Professor Andre Geim, for his discovery and work with the nano-material graphene.The conference is being chaired by Nava Swersky-Sofer, who is one of the leaders of Israel's life-science industry and is the former CEO of the Hebrew University's tech transfer arm, Yissum; Mr. Dan Vilenski from the Israel National Nano-technology Initiative (INNI); and Prof. Arie Zaban from Bar-Ilan University."Israel is known worldwide as a center of knowledge and innovation in nano-technology and research in the nano field. Israel's achievements are at the forefront of a variety of the industrial fields, such as communications, electronics, computerization, security, medicine and life-sciences," says Swersky-Sofer.Israel is already on the international nanotech map, according to the INNI, one of the conference sponsors. The group lists about 80 large and small companies working in Israel's nanotech sector, along with more than 40 academic and governmental labs, employing some 300 researchers and scholars. The INNI states that Israel has the third-largest concentration of startup companies in the world, surpassed only by California's Silicon Valley and the Boston technology corridor.A survey conducted by INNI shows that the Technion employs 119 nano-researchers, followed by 55 at Tel Aviv University, 47 at Ben-Gurion University of the Negev, 43 at the Weizmann Institute of Science, 39 at the Hebrew University in Jerusalem and 30 at Bar-Ilan University. Since 2002, the number of nano-researchers in Israel has doubled. The two main scientific disciplines are chemistry (25.6%) and physics (19.5%). Most of the researchers (33%) focus on materials, followed by electronics and photonics (22%) and biotechnology (17%).Israel had a head-startIsrael is ahead of many other countries in this new field, because its researchers have been working in the nano sphere for years. Among the researchers is Prof. Reshef Tenne of the Weizmann Institute. Tenne, who will chair a session at the conference, is best known for leading the group that discovered and studied the inorganic fullerene-like nanospheres and nanotubes, generally termed IF nanoparticles, considered a new class of nanomaterials. Tenne says that nanotech development suits the Israeli development model: "This is a small country, and nano-material research, of course, is done on a small scale. But the research can yield big results, and we expect that today's research will pay off handsomely in the coming years.""Over the next five to 10 years we'll see nanotech applications take off," Prof. Reshef Tenne of the Weizmann Institute.Israeli researchers have done a great deal of work in helping to discover new nano-materials, and Israel is by far the most advanced country in its neighborhood in nano-research. "You can tell how advanced a country is by the number of high-resolution electron microscopes a country has. We certainly don't have the resources that rich European countries like Germany and Holland have, but we've got quite enough for a country of our size. We're in a good spot in the middle, and our researchers take full advantage of the resources available," Tenne says.Tenne himself conducts ongoing nanotech research at the Weizmann Institute in both basic materials and applications, a combination that he says suits him well."Over the next five to 10 years we'll see nanotech applications take off. Most of the first round of applications will probably be in the medical field, and we here in Israel have been making great strides in the area of nano-medical technology," Tenne relates.Manipulating small elements of matter as it does, the science of nanotechnology is also considered an art form. 'Nanoart' features nanolandscapes (molecular and atomic landscapes, which are natural structures of matter at molecular and atomic scales) and nanosculptures (structures created by manipulating matter at molecular and atomic scales using chemical and physical processes). These scientific images, captured and processed with various artistic techniques, will be on display at the November conference.

INNOVATION NATIONIsrael – a small country of 7 million, in a constant state of war and with no natural resources – has become a hi-tech powerhouse. Joe Charlaff reports on why its talent for enterprise is pivotal to its futureThe serious money to be made in the cellular equipment market is in systems-on-a chip (SoC), which routes and transmits the ever-growing data stream. Provigent, which develops innovative SoC solutions for broadband wireless networks, is currently one of the most talked-about Israeli start-ups. The outfit has been profitable for 18 months (posting $40m revenue last year, up 60% on 2009) and already boasts Ericsson, Alcatel-Lucent and China’s Huawei Technologies as clients. After months of debate about whether it should go for a Nasdaq IPO, Provigent directors announced in March that they had decided to sell to semiconductor giant Broadcom, based in Irvine, California, for $313m (€221m). The deal marked Broadcom’s ninth Israeli acquisition.A few weeks later Facebook snapped up its first Israeli company, Snaptu, which had launched a Facebook mobile app a few weeks earlier, for a reported $70m. And rumours were growing in techie circles that Conduit, a start-up based in Rehovot that creates browser platforms for toolbars, is negotiating a $1bn deal, possibly with Google or Microsoft, that would be the biggest sale of an Israeli internet firm so far.For the past 40 years, since ECI Telecom put down roots there, an enclave along Israel’s coastal plain – which became known as Silicon Wadi (the Arabic word for valley) – has become a hotspot of computing, surveillance, videogames, transport and other innovations. This hi-tech oasis, largely concentrated in Tel Aviv and smaller cities, is now home to companies such as Microsoft, Google, and many other household names, making it an important part of Israel’s economy. Intel’s latest microprocessor was developed at its new $110m R&D centre in Haifa, and Intel Israel has been responsible for developing the Pentium and Centrino chips which power most PCs around the world. According to official figures, Israel’s hi-tech industries, which include the software, medical, electronic and advanced mechanical sectors, made up about 15% of the country’s $200bn GDP in 2009, and 40% of its exports.It’s not hard to see how this situation came about. The modern-day State of Israel is a small country in the desert, constantly at war with its neighbours and with little in the way of natural resources. It has arguably had to live off its wits since its founding in 1948, becoming a pioneer in the field of desalination and a leading exporter of defence products. Toss in the influence of the Israeli Army Intelligence Corps’ technology units, world- class academic institutions such as the Technion in Haifa and the Weizmann Institute of Science in Rehovot, and the shared Jewish experience of moving from place to place and starting afresh, and you can see where the nation’s resourcefulness stems from.But although Israel has the largest number of start-ups in the world in relation to its population – and is second only to the US in total – a growing number of successful home-grown companies are being gobbled up by larger foreign names.In selling out to US giants, Provigent – named by Ernst & Young as Israel’s most promising start-up for 2010 – and Snaptu are simply following in their peers’ footsteps. Only last April, Google paid $25m for start-up LabPixies, a leading developer of personalised web gadgets. Five months later it bought Quiksee for an estimated $10m. Founded in 2007, Quiksee produces location-based online tour technology, enabling users to create interactive 3D walkthroughs from simple video clips. The technology is regarded as the missing link in Google’s Street View service (used by Google Maps and Google Earth), which allows users to view images of streets around the world.Even in the depths of a global recession, 63 Israeli companies were acquired or merged in 2010 – a decline of 22% from the previous five-year average of 82 deals – according to the Israel Venture Capital Research Center (IVC). From 2009 to 2010, the size of the average deal fell 15%, from $37m to $32m. VC-backed deals (26) totaled $1.25bn, down from $1.54bn (28) in 2009.Three of last year’s M&A deals exceeded $200m and two were in the $100m-$200m range. The top 10 amounted to $1.4bn, 69% of the year’s total. The leading deals were 3M’s acquisition of Attenti, estimated at $230m; Mellanox’s $218m purchase of Voltaire, a Ra’anana-based provider of scale-out data-centre fabrics; and the $213m acquisition of network processer-maker Wintegra by PMC-Sierra, which already has a presence in Israel.Tel Aviv-based Attenti is a leading supplier of remote people- monitoring technologies, used to keep tabs on people awaiting trial or on probation, and by healthcare staff to assist in the care of elderly patients. The company’s CEO, Yoav Reisman, says: “3M’s culture of innovation fits well with our own, and its research-and-development capabilities and global reach will help accelerate the growth of our business.”Saul Singer, co-author of Start-Up Nation: The Story of Israel’s Economic Miracle, points out that no matter how hi-tech their products, the founders of Israeli businesses are entrepreneurs. When they reach the stage of scaling a company up, they become bored, preferring to move on to their next idea. “It’s not a bad thing,” he says. “Look at the career of an entrepreneur who is productive and able to build a few start-ups, then compare that productivity to someone who remains in the same company”.In his view, the pace of change over the next 20 years is likely to be greater than that of the past 50. “We don’t know what will happen, and in that situation it’s preferable to be in a start-up economy where there is much more flexibility. Start-ups are much better equipped to deal with rapid change as opposed to big companies and that makes them more valuable.”One problem is that Israel is a young nation with little experience of developing world-beating companies of its own. According to Todd Dollinger – chief executive of The Trendlines Group, which invests in and develops innovation-based businesses in the life sciences, cleantech, IT, security and other markets – few managers have “grown up” in large enterprises, meaning they lack the skills to engineer a company’s expansion. “Israelis who develop real skills in the sales and business- development realms do so while outside Israel – in the US, the UK and elsewhere,” he notes. “When they come back to Israel after succeeding abroad, they don’t stay in business development, they seem to move on to new ventures and their skills are lost.”A more serious hindrance is the lack of capital. Mindful of the rewards of a hi-tech culture – namely jobs, profits, investment opportunities and knowledge – governments in the 80s and 90s hatched Israel’s incubator system and various seed-funding mechanisms. Yet even at their peak, Israeli venture-capital funds were unable to offer large investments and following the global capital-market downturn, they struggled to raise cash. As a result, Israeli companies turned to foreign sources, which in many cases entailed basing their headquarters and senior management in the funder’s city. This has been exacerbated recently by a change in the R&D law – a cap on the penalty paid by companies if their operations are moved abroad. Dollinger adds: “The government’s insufficient support for education is a potential disaster. It’s bad for the country in every conceivable way.”“In general, start-ups can go two ways,” says Michael Eisenberg, a partner in Benchmark Israel II, a Herzliya-based fund that specialising in seed, start-up, and early-stage investments in ICT companies. “Either they sell or go public, otherwise the investors can’t get their money back. It’s about making money for the investors.“In Israel there is an issue about companies selling early and not going all the way to becoming a large company. A few reasons can be attributable to that: there has been some short- termism from fund managers looking for quick exits. There is a sea change and the trend is now for there to be larger, venture- capital backed companies, which is exactly what is needed, and the entrepreneurs are dreaming bigger, which will help the venture environment and lead to greater opportunities.”The financial crisis of 2008, which severely impacted institutional investors, was the major impediment to raising new funds. In 2009, only $234m was raised by Israeli VC funds and $200m of that was raised by just one of them, Sequoia Israel. In spite of improved macroeconomic conditions, Israeli VC funds were unable to attract new capital in 2010. Capital-raising trends in Israel generally correlate with trends in the US, which experienced a 50% reduction from 2009 levels.Last year, the government announced an incentive programme for Israeli institutions to invest in domestic VC funds that is expected to increase investment by $220m in 2011-12. According to IVC CEO Koby Simana, the situation is critical. “Without improvement, it threatens the survival of numerous Israeli hi-tech companies that cannot raise needed capital.Moreover, VC funds will not be able to finance new companies or, in some cases, support their existing portfolio companies.”Looking ahead, IVC is cautiously optimistic about capital- raising, based on a positive outlook for the local economy and government steps to stimulate investment. “However, most of the impact of the government plan will only be felt in 2012,” says Simana, “since local VC funds must first raise substantial amounts – 60% of the total capital of each fund – from foreign investors. It’s a real challenge for Israeli VC funds.” Many hi-tech companies that have not managed to raise capital face a threat to their very survival, he warns.Yoram Tietz, managing partner of Ernst & Young Israel, points out that Israel’s main assets are human capital and innovation – and says that without more investment, the country risks losing its crucial innovative edge. Faced with such a crisis, the Ministry of Finance and the Ministry of Industry and Trade have intervened, introducing a programme called the Competitive Advantage National Plan. Yuval Wollman, an adviser to the finance minister, explains: “Given that this is the growth engine of the Israeli economy, we thought that it would be wiser, strategically speaking, to capitalise on the advantages that we still have, examine the weaknesses and see what measures should be taken.”The ministries concluded that potentially innovative companies were being starved of capital from the Israeli market. At the moment it is common to exit start-ups early, with entrepreneurs aiming their initial public offerings at the US or agreeing mergers and acquisitions with large American companies. The government’s idea is to encourage companies to have their IPO in Israel so that they contribute to the economic ecosystem.The measures also include encouraging minorities, such as the Arab and ultra-orthodox Jewish communities, to join the hi-tech workforce through the higher education system. In addition, a fund is being established that will match government funding to private capital, facilitiating the transition of ideas from academic institutions to industry.To address the dramatic decline in the capital raised from local pension and provident funds (institutional investing domestically is only 0.2%, compared with 2% abroad), the government has allocated approximately $55m as a way of participating in the investment risk of Israeli institutional investors.And with seed-stage companies short of cash – raising only $39m in 2009, down 56% on the previous year – the government will allow investment in an R&D-focused company to be reported as an expense on day one, deductable against income from all sources over a three-year period.In addition, there will be tax incentives for large Israeli tech companies, such as the security specialist Check Point, to buy local start-ups, creating sub-industries within the Israeli market.Alan Feld, founder of Vintage Investment Partners, is convinced that the industry will get back on its feet, given time. His firm, which manages around $460m, has a database of more than 3,500 Israeli tech companies and tracks 90% of funds related to the sector on a quarterly basis. “We probably have the most active database of what’s happening out there,” he says.According to Feld, the decline in the amount invested in Israel between 2008 and 2009 is not dramatically different to what happened in the US in that period. While the drop in the amount invested was approximately 40%, the drop in the number of venture deals was only about 10%. Funds are investing in a far more capital-efficient way, he notes. In addition, venture funds have raised the bar by looking for better quality companies and being much more careful about how they invest. “We view that as being good for the industry as well. So, despite the drop in dollar terms, what’s more important is the number of deals done, which indicates a healthy level of activity.”A dramatic increase in angel investing, along with an increase in the number of venture funds returning to seed investing, also bodes well for the industry, and Feld believes that $600m-$900m will be raised by venture-capital funds this year – not far off the average raised after the crash of 2001. “We anticipate committing to at least three funds in 2011,” he says.As far as Singer is concerned, Israeli tech has huge opportunities for growth. “The ecosystem that has developed with American companies has barely begun with the same kind of companies in Europe, Latin America and Asia,” he says. “Siemens, Deutsche Telecom and Samsung are in Israel, but so many other companies outside the US are not. Why shouldn’t these other regions gain the same advantage as US companies have by injecting themselves with Israeli innovation?”There is considerable room for US firms already in Israel to increase their involvement, says Singer, and for those that are not in Israel yet. As well as exporting technological innovations, the country is making a name for itself in the field of innovative business models. In recent years two of its more conspicuous successes have been Better Place, which provides electric- vehicle networks and services internationally, and food company Strauss-Elite, whose coffee division operates in 12 countries (including Brazil, where it merged with a domestic operator to form the nation’s second-largest coffee manufacturer).It may be down now – but if history is anything to go by, Israel is far from out. 

Tel Aviv ranked world's 3rd hottest city for 2011By JPOST.COM STAFF  11/01/2010 15:03 Lonely Planet's Top Cities list describes Israel's most international city as hedonistic, tolerant, cultured, and a truly diverse 21st-century hub.After scouring the globe for next year’s hottest cities, the editors at travel guide company Lonely Planet released their Top 10 Cities for 2011 on Sunday, listing what it called a “modern Sin City” – Tel Aviv – at No. 3.Coming in behind New York City and Tangier, Tel Aviv is described as being unified by the religion of hedonism, yet tolerant, cultured and a truly diverse 21st-century hub.Touching on the city’s wellknown night life, Lonely Planet observes, “There are more bars than synagogues, God is a DJ and everyone’s body is a temple.”Calling Tel Aviv the most international city in Israel, Lonely Planet points out that the city is home to a large gay community, calling it “a kind of San Francisco in the Middle East.”On a cultural note, they credit the city’s university and museums with making it “the greenhouse for Israel’s growing art, film and music scenes.”Lonely Planet recommends strolling down the pleasant tree-lined streets that reach to the Mediterranean Sea, and finding out why Tel Aviv’s residents call it the greatest city on earth.Other cities that made the list were Valencia, the Peruvian Amazon city of Iquitos, Delhi, Newcastle, and the city the company describes as the spiritual heir to Bob Dylan, Chiang Mai.Lonely Planet on Sunday also listed its Top 10 Countries for 2011. While Israel did not make the 2011 list, Syria did.Coming in at No. 9, the guide lauds Syria’s slowly liberalizing economy and the newfound freedom of no longer having the “noose of the ‘Axis of Evil’ tag hanging around its neck” as some of the reasons for Syria making this year’s list.The writers recommend the old cities of Aleppo and Damascus, exploring the open countryside “strewn with the abandoned playgrounds of fallen empires.”Albania topped the list, with Brazil coming in second.