This post was originally posted on CenterNetworks.com as part of my blogging on the Israeli startup scene.

Folks, I’ve found a winner and its name is iMedix. The team, the product, the niche, the model–all par excellence. I am willing to go on a limb and venture that they’ll see a liquidation event in the next 24-36 months. Let’s dive in…

iMedix is a community powered healthcare search engine. Here’s how it works: Based on proprietary algorithms, iMedix evaluates healthcare related sites to generate results for what it considers “top sources”. Then, users interact with the results and add their feedback ratings, generating even better results. Underlying magic includes a neural network based feedback analysis mechanism.

The company was founded in 2006 by Amir Leitersdorf (CEO) formerly CTO of Tapuz (a major Israeli web property) and CEO of Movota (acquired Arvato), and by Iri Amirav (CMO) formerly Senior Marketing Director of MetaCafe. The rest of the team includes the former lead developer of aniBoom, a guerilla marketing specialist, a mathematics academic and former graduates of various IDF signal corps.

The idea for iMedix came about when Iri and Amir noticed that healthcare info was far lagging compared to news and entertainment. They then discovered 80% of US online users search for healthcare info. Realizing the potential, the duo began developing a prototype at nights. The result was impressive enough to motivate a number of undisclosed private investors to make an Angel investment large enough to carry the team at least another year from today.

I’ve had a chance to play with the engine and I’m impressed by the search results. These will only get better seeing as the iMedix engine is designed to improve as user interaction increases. The engine features a “did you mean” feature which I’ve found to be more effective than Google’s in terms of the type healthcare related searches iMedix focuses on.

The engine is currently in closed-Alpha but I was able to arrange for 50 exclusive invites… Send in your details to get on the list!

iMedix is very conscious of the user experience and have been going back and forth on whether to incorporate an iMedix frame in the header of search results users click through. While I really hate About.com’s frame, I actually feel most iMedix users would benefit from one, especially if it is able to provide the user’s search results.

Other than the search engine, iMedix.com also features a blog zone. I have a couple of issues with it. First, while I can appreciate the importance of cultivating a community, I feel there is a dissonance between “running an engine” and “running a community”. Personally, I feel iMedix would be wise to focus on the former. Second, I feel that if they do elect to go with a blog zone, then the wise route would be to integrate a 3rd party platform such as WordPress. My reasoning is simple: iMedix should focus on its competency and building and maintaining a blog platform is not it (even if it serves a tactical purpose).

If you’re going to build your business on an advertising revenue model, you better know the dynamics. If you need further testament that Iri and Amir are a couple of business savvy founders here it is: Brace yourself… 10,000,000 US users perform healthcare searches daily(!) I was blown away by this figure. This is the same number of users paying bills online in the US. And it gets better… Healthcare related advertising is growing at a rate higher than other industry standards and feature lucrative ad costs. You might want to scroll-up and re-read my first paragraph…

Let’s talk competition: The biggest wave in recent years was made by Steve Case’s RevolutionHealth which seems to be gunning at WebMD. Both are destination sites as opposed to being search driven. Traffic-wise, in second position is Healthline which is doing a pretty good job, although it too is more destination oriented. An upstart in the field is Healia which positions itself specifically as a “health search engine”. I gave it a spin and wasn’t all that impressed, especially with the thought placed on user interaction.

If they haven’t yet, smart VC’s should place iMedix on their radar. I don’t foresee an IPO but an acquisition by the likes of AOL, Fox Interactive, Yahoo!, IAC, or one of the big competitors sounds just about right.

iMedix–remember the name.

Globes is reporting that LivePerson has acquired Kasamba for $9M in cash and $31M in stock.

Congratulations to the entire team at Kasamba which have persevered and hit one out of the park!

This post was originally posted on CenterNetworks.com as part of my blogging on the Israeli startup scene.

What do you do when your next biggest competitor has $30,000,000 (and you don’t)? That’s exactly what I asked the folks at 5min.

5min pegs itself as a destination site for tutorial videos. The idea is that any questions can be answered in a 5 minute video. This can range from how to kite surf, to how to pour a head of beer. So instead of searching for an exercise program and locating a written one, you would instead locate a video of a workout tutorial in which you can actually see the drills. Right now 5min has over 2000 user generated videos in its catalog. Check out the official 5min introduction video:

The company was founded in late 2006 by Ran Harnevo (CEO), Tal Simantov (CMO) (pictured right) and Hanan Lashover (CTO). The three secured a $350K seed investment from Grey Interactive (Israel) and a few local angels. This allowed them to go live in February and scale-up their operation to 8 full-time employees. They are currently in discussions for Round A financing (although I’ve understood suitors are welcome…).5min believe the how-to video niche to be a viable one. First, from the user-experience angle the assertion is that even though such videos can be found on YouTube, they get swallowed-up by the beast and are difficult to locate. As such, both producers of such content and users seeking it would prefer to have a destination site.Second, from the business-model perspective, 5min believes this niche offers interesting opportunities for advertisers. Think of Gibson advertising alongside/in a guitar tutorial vid.

Side Note on “Traffic = $$$”: It’s all too easy to say “advertising revenue”. Delivering the phenomenal number of views necessary to support such a model is completely different.
I honestly feel too few entrepreneurs truly comprehend the economics and its implications. Jeremy Liew of Lightspeed Venture Partners wrote a great post about this.

The 5min team spent the first months developing their platform. This includes the backend magic, which they architected to be laden with metadata potential. They also developed their “SmartPlayer” (embedded above), a very good looking embeddable Flash Player specifically designed for how-to videos. It includes features the 5min team dubs “must-haves”, including: Zoom control, speed (frames, slow-motion), etc. The feature that caught my eye is the Storyboard which allows video producers to add text in relation to the video. Users can then print-off the storyboard for a complete step-by-step tutorial. This will be especially useful when dealing with musical notes and recipe ingredients.

Leading the competition pack is VideoJug which announced a $30M funding round in May. Unlike 5min, VideoJug produces their videos in-house. I don’t see this as a disadvantage. UGC is great, but it’s far from perfect. Take for example issues such as tempo, timing and cadence. Rarely would you find a UGC producer that takes these into consideration before shooting the video. With VideoJug these come first and foremost.

On an excitement meter of 1 to 10, I would rate VideoJug as a 4, but I would also rate About.com as a 4. Thing is, About.com is a big money maker. “Boring” is a solid business principle and VideoJug clearly knows this. In fact, what I imagine is driving them is knowing that Big advertisers (Procter & Gamble, General Motor, etc.) feel more comfortable with such in-house/professional content, as opposed to UGC.

Now, does knowing their main competitor has $30,000,000 keep the 5min team up at night? Seems not. They give VideoJug the appropriate respect, but feel that UGC how-to’s is where they should focus their efforts on. In fact, they’re gaining traction… There a few promising business development deals in the works with well established companies (sorry, can’t comment on these).

As I see it, the problem is that VideoJug can’t be completely incompetent if it raised $30M. Meaning, UGC vids can’t possibly have escaped their mind. They can all too easily take $10K, produce a UGC platform in a month and just see what happens. I don’t see what they have to loose.

Is this space big enough for more than one large player? My gut says no. Smaller players can certainly make some nice money but I doubt we’ll see $xxM acquisitions.

This post was originally posted on CenterNetworks.com as part of my blogging on the Israeli startup scene.

Fixya harnesses collective wisdom to deal with one of the modern age’s greatest woes… Tech Support. Let’s face it, Plug-n-Play is anything but and dealing with phone support is costly and exceedingly frustrating. This is where Fixya comes in.

I recently had a chance to sit down with Yaniv Bar-Lev, Fixya’s VP of User Acquisition to learn more about the company.

Fixya is a simple service (simple = good). Users can submit a product related question from across a catalog of 700,000 consumer products. The scope is quite broad, from gadgets to baby strollers. Solutions are then posted by both everyday folks, as well as “Experts”.

Pay attention all you entrepreneurs with “+1″ solutions: 1) Got a problem, 2) Post a question, 3) Get an answer, 4) Problem solved.

It seems common place that companies in the social space have a mélange for a business model. Fixya’s is no different: On-site advertising, repair and part affiliations, as well as premium services such as “Guaranteed Answers” and Online 1-1 tech support. Revenue derived outside of the destination site includes content syndication and white-labeling the Fixya platform to be implemented within support service sites of consumer product companies.

Founded in 2005, Fixya is led by co-founder and CEO, Yaniv Ben-Saadon, formerly of Hotbar. The company was originally funded by a few Angels, most notable among them is Yossi Vardi (see below). Pitango Venture Capital and Mayfield Fund participated in a second funding round, reportedly in the $4M range.

Vardi Side Note: Dr. Yossi Vardi is considered the grand poobah of the Israeli Internet industry. He was the founding investor of ICQ in which his son, Arik Vardi, was one of the co-founders. Today he is a well-regarded Angel that falls under the “smart money” status. He’s also known to be extremely supportive of startups and entrepreneurs. I’ve yet to be at a startup shindig in which I haven’t heard, “Has Yossi Vardi seen this…?”.

Competition-wise, the two big players of this space are unquestionably AllExperts (owned by mammoth About.com) and Experts Exchange. Out in the boonies are the likes of TechLore, and Retrevo.

While the big challenge for Fixya will be to establish itself as the obvious destination site for tech support, the more logical course of action is to focus on SEO and reach users organically. This point has not gone unnoticed at Fixya. Just try Googling “Sony troubleshooting” and they’ll come-up as the second result, right after Sony’s own support site.

It’s going to be a long hard battle for Fixya and we technically baffled folk have only to gain from their work.

Shai Tsur, Associate at Giza Venture Capital, maintains the firm’s official blog. Noteworthy is BloGiza’s weekly roundup called The List… Even if your an avid blog reader, you can rest assured Shai will include a couple of good quality items you missed along the way.

Definitely worth subscribing to…

Marc Andreessen started blogging about a week and half ago. I would have expected him to have started ages ago…

Andreessen was co-founder of Netscape. He then founded Opsware. His latest venture is Ning which is a very impressive social network platform. Basically, you can create your own network using pre-built modules, or trick it out by editing your own version of the source(!) Very neat if you haven’t checked it out so far.

In any case, blog.pmarca.com is a pretty good blog so far and you should probably add it to you reader.

For those of you who don’t know, in Israel, Sunday is the first day of the week. I love Sunday so much that I usually don’t sleep very well on Saturday night in anticipation of all the things I’m waiting to do the following week(!)

Every Sunday I look forward to two things: 1) New episode of Diggnation, and 2) Brand new set of postcards on PostSecret.

Gotta love Sundays!

This post was originally posted on centernetworks.com as part of my blogging on the Israeli startup scene.

It’s no secret that Israel is well regarded for its high-tech skills. However, consumer oriented Web products and services have not been our expertise. Don’t get me wrong, there have been a few major successes-ICQ which revolutionized all our lives with the invention of Instant Messaging and Shopping.com the price comparison service, to name two of the gems-but we’ve been much better at software and semiconductor engineering. This may all change.

In the last couple of years the land of milk and honey has been a hotbed of 2.0 innovation. Here is a small sampling of Israeli ventures we should all keep an eye out for:

Zlango

Certainly one of the more unexpected startups to hail from Israel is Zlango which created a completely new language based on icons. The brainchild of Yoav Lorch, Zlango was originally created to energize the lifeless but ever popular SMS. The company has since realized that there is no avoiding the Web and is gearing-up for a strong push into the world of Instant Messaging.

To see the language in action, check out a Zlango’d version of Little Red Riding Hood. It’s a must read-I mean view…

In probably the coolest ever press release, the company announced it raised $12M from VC’s Benchmark & Accel. I have it on good authority that the turn around on the term sheet was around 9 days-astonishingly quick for VC’s.

Silly? Some think so. Others I’ve spoken to believe Zlango to have quite a bit of potential when merchandizing and cross-marketing opportunities are added into the formula.

MetaCafe

Honestly, how many of you knew that MetaCafe is Israeli? My guess, only the Israeli readers :) Kidding aside, MetaCafe is one of the originators of what we all have grown accustomed to in viewing video on the web: Flash player, embedding, rating, etc.

It’s been a strange year for MetaCafe. Rumors of an acquisition in the $200M range were buzzing around in December 2006. I don’t know the inside story, but the common understanding is that traffic stalled and began to decline. Since then they’ve hired EA veteran Erick Hachenburg as CEO and struck a deal with Steven Bochco for an exclusive series of short confessionals called Café Confidential. Not too shabby.

The real trick of course in the online video space is monetization. While YouTube seems to be in a near state of paralysis, MetaCafe is being adventurous. A couple of weeks ago came an announcement that MetaCafe will be piloting a new advertising platform by upstart Adap.tv (founded by Shopping.com founder Amir Ashkenazi, you guessed it, an Israeli). Evidentially, instead of pre-rolls, contextual ads will appear underneath the videos.

Going by Nielsen/Net Ratings’ April 2007 numbers, MetaCafe is the 7th most popular video site. Interesting if it could be the number #1 monetizer…

aniBoom

aniBoom is a niche play in the video space that focuses strictly on animation shorts. Unlike the normal amount of crap we’re used to seeing in YouTube-like clones, aniBoom’s content by most accounts is top-notch. I say this in terms of both the quality of content and the level of production.

However, one of the more interesting aspects of aniBoom is its founder Uri Shinar. A former big-time TV honcho, Shinar is accredited in having a great deal to do with the success of Israel’s Channel 2, the country’s #1 commercial station and the one that sets its social agenda.

Shinar’s take on aniBoom’s business model is refreshing and bold. He claims that aniBoom is being molded into an animation studio-one powered by user generated production mind you.

Forget the traffic=$$$ paradigm, this baby is being primed for acquisition based on the value of its content depot. I have strong feeling it will be snapped-up by an American media conglomerate of some sort. Evergreen should expect multiples with this investment.

eSnips

Social networks are surely the flavor of the year, but launching one and operating a thriving one, are two different ball games. eSnips is a case-in-point for a successful run.

eSnips users, who should be well above the 1M mark, get to share, promote and sell up to 5GB of photos, videos, links, music, documents and even hard goods-all from one central location. Check out their presentation at last year’s DEMO.

eSnips has been rolling out some features on a steady basis. These include the uploading of photos from mobile phones, a marketplace and most recently, a radio widget that plays music uploaded by users. I’m guessing the latter will be mostly successful within the eSnips community itself, rather than outside of it.

Not only did the stars line-up just right for eSnips, it also has a skilled team to boot. Noteworthy is the fact that eSnip’s CEO, Yael Elish, is a woman. Unfortunately this is still uncommon… In fact, I can only think of one or two other female startup CEO’s here in Israel. VC’s Gemini and Greylock are in it for the ride with a combined investment of $2M.