Reuters buys Israeli start-up ClearForest

ClearForest has developed text analysis solutions for business intelligence applications.

Globes and Haaretz reported that Reuters Group has acquired Israeli text analysis technology developer ClearForest Ltd. for about $25 million. The companies announced the deal today, before trading began on Nasdaq.

ClearForest was founded in 1998 by chairman and chief scientist Dr. Ronen Feldman and CTO Dr Yonatan Aumann . Aumann is the son of Nobel Prize for Economics Laureate Prof. Israel Aumann.

ClearForest, developed technology to analyse, read and understand large amounts of content originating from diverse documents. Reuters is one of the clients for its technology, which tags content by the principles of artificial intelligence. Other prominent clients include: DowJones, Boing and the FBI.

ClearForest has 31 employees and led by Barak Pridor. Headquartered in Boston, the company has a development center in Or Yehuda, Israel. Under the acquisition agreement, the company will operate under Reuters Search and Strategy Division, headed by Gary Campbell.

Its Israeli shareholders include Greylock Partners, Pitango Venture Capital, Walden Israel, Plenus, and Kadima Hi-tech. Foreign investors include ABS Ventures, Booz Allen Hamilton, Dow Venture Capital, HarbourVest and JPMorgan.

Source: Globes

Bubble Burst - web 2.0 for sale

In the past two years we've seen over 1154 web 2.0 start-ups, based on the logo count of GoWeb20. Unfortunately, not all start-ups make it which created a new type of commodity: web 2.0 sites for sale.

As reported by Techcrunch earlier this month, Web 2.0 for sale is a marketplace for Web 2.0 sites, creating an alternative for the typical Google/ Ebay exit for entrepreneurs in dire need of cash.

The board was created by Edgio, and offers a publishing platform for programming code, domains, prototypes and of course, the complete website suites. $10 will get you an ad for 30 days.

On the site you can find listings for as little as a few bucks or as much as $1.25 Million, as in the case of PayByCellphone that is selling its complete operation.

Other message boards in this niche include Venture Board and eBay.

Keep an eye on NeoCleus

Neocleus, a security start up in stealth mode was reported to raise $5M in a round led by Battery Ventures and Gemini Israel Funds. This round follows a seed investment of $700,000 made by the two funds a year ago.

Neocleus develops online access security management technology that helps users safeguard their online access. They received the financing round after extensive feasibility studies of the technology as well as market studies.

Neocleus was founded last year by Ariel Gorfung (CEO) and Etay Bogner, both experienced in the security software field. Bogner previously worked for Sofaware, which was acquired by Check Point Technologies Ltd. in 1999 and Gorfung founded of Optibase Ltd and E-Sponsor. The company currently employs 15 people and is based in Tel Aviv.


Read more at: Venture Deal

Israeli Telco Database Startup Xeround Raises $7M

Xeround Systems, an Israeli based Telco Database start up has recently raised 7M in a second round of financing from Benchmark Capital and Giza Venture Capital. To date, Xeround raised a total of $14M.

According to their website, "Xeround's unique approach to real-time data management delivers cost performance that far exceeds proprietary, traditional off-the-shelf and in-memory database solutions. Enabling real-time database convergence over commodity infrastructure like blade servers, solutions from Xeround represent a quantum leap in cost and performance."

Xeround is led by Dr. Gilad Zlotkin, previously a VP of Engineering at Class Data Systems.

William Blair - 35 Israeli start ups to follow

“Israel has become an important market for investors, particularly in the technology sector.”

William Blair & Co., a strategic partner of Poalim Capital Markets - Investment Bank Ltd., has initiated a quarterly survey of Israel. Richard Kiphart, the head of the Corporate Finance Department has recently returned from a quick trip to Israel, in which he visited a number of promising start ups.

The survey mentions 35 start-ups that William Blair has chosen to monitor, and predicts that some of these companies will be sold or go public in the coming year.

Three of these companies are profiled in the review:

• GI View Ltd. developed a tool for early diagnosis use in the large intestine. The device is a disposable, miniaturized, self-propelled, self-navigating endoscope for early diagnosis of precancerous tumors that requires no special skill to use, in contrast to colonoscopes, which have to be operated by expert doctors.
• Press-sense Ltd., a provider of Business Flow Automation solutions
  for the printing industry. The company's flagship, the iWay
  Family of Products, is based on a proven technology presently
  being employed in such major publications as USA Today, Newsweek
  and the Daily Telegraph.
• Traiana Inc., creator of automated post-trade processing of financial transactions. Started in 2000 Traiana today has a network of over 50 Prime Brokers, Dealers, and Investment Managers connected to its Traiana network, as well as hundreds of hedge funds using its products and service through their Prime Brokers.

In summary, William Blair says: "“Israel…is in many ways an emerging economy… The political risk level is high as well, although perhaps overstated considering its high profile. The country, however, is much further developed than many other emerging markets…"

A lot has been written about 5Min

Israeli start-up 5Min describes itself as a place to find short video solutions for any practical question and a forum for people wanting to share their knowledge.

5Min's goal is to create a community Life VideoPedia, by providing user generated instructional videos that serve as visual tutorials on a wide range of topics. Current categories include arts, business, fashion, sports, health, tech, food, and much more.

5min was founded by three Israeli entrepreneurs: Ran Harnevo, Hanan Lashover and Tal Simantov. The founders philosophy of is that any solution can be visually explained in less than 5 minutes.

Unique features include the ability to watch clips in slow motion, frame-by-frame or even zoom in and the option to leave a question to be answered by a 5min expert.

As reported by Alarm Clock and NetTeeVee, 5Min recently raised $300,000 in angel funding from unidentified investors. They are joining several other companies in the how-to video field such as Jabbits and the more stablished VideoJug.

Some of the popular videos are:

• How to Belly Dance
• How to pour beer
• How to isassemble a PS2
• How to Tie a Tie

Start Up Journal Blog Watch

Greetings! After almost two months of absence due to a coast-to-coast move, I'm happy to be back to VC Cafe, and there's much ground to cover.

First, some exciting news. Sarah Needleman from the Wall Street Journal interviewed me a couple of weeks ago, and the article went live last Friday (4/20) on Startup Journal, the Wall Street Journal center for entrepreneurs. The VC Cafe is featured in an article on "What small business can learn from blogs".

I am very excited to be on this list with many respected blogs such as:

• Work Happy provides advice, ideas, inspiration and resources Carson McComas accumulated through his own experience as a consultant to entrepreneurs and owner of four Web-based ventures.
• Franchise Pundit reports on emerging franchises, relevant legal news and various industry happenings.
• Young Go Getter covers all aspects of starting and running a business from the perspective of a young person
• Escape from Cubicle Nation focuses on the emotional aspect of leaving the corporate world to start a business.
• Biz Bang Buzz is about legal issues pertaining to entrepreneurs
• Marketing Blog provides ideas and opinions about small-business marketing
• Small Business Trends focuses on major developments that affect small-business owners
• The Invent Blog gathers articles on patents and legal related topics
• How to Change the World is Guy Kawasaki's 'best-seller' blog, which you all probably know...
  

All of the above are great blogs and I warmly recommend checking them out. If this is your first visit to VC Cafe - Welcome! Whether you are an entrepreneur seeking to gain blogosphere exposure for your startup, or a VC looking for new investments, I look forward to connecting with you.

For the full article in WSJ, click here.