Startups in Israel come in all shapes, sizes and types; there are hundreds, maybe thousands of people out there with ideas that may eventually change the world. Investors form Israel and from around the world flock to the companies that build the applications, websites, and services that bring these ideas to life.

But who will invest in the ultimate startups – the places where the magic begins? Those entrepreneurs have to start somewhere, and that somewhere is in school. Not just university – elementary school, too! It’s there that the future hi-tech leaders of Israel get their training, education, and motivation. And there’s no question that there’s a major payoff for the country from a successful education system.

But while the general Israeli economy benefits from good education, investors don’t get a direct payoff from the money they sink into the country’s schools. As such, most VCs and investment firms don’t see the schools as a place to invest in. At best, they may be persuaded to give an occasional donation, for good PR, if not out of conviction. But even though they are likely to benefit from an educational system that turns out skilled information workers, such investors want to see more direct payoffs for their investment shekels.

But there are those who take the longer view – companies like Rad Communications and Radware, who were once startups themselves. Now that the Rad family of companies – led by the members of the Zisapel family – are large, established, organizations, they’re taking that long view, and investing in the country’s true “startups”: Elementary schools, high schools, and universities.

“Supporting education works on both ends – both for the recipient of the help, and those providing the help,” says Roy Zisapel, CEO of Radware. “Hi-tech accounts for half of Israel’s exports, and we need to groom and encourage young minds to get involved in those areas, for all our sakes.”

As a result, says Zisapel, the company conducts a wide-ranging program where workers go into schools in local communities, both well-to-do and disadvantaged, and preach a gospel of hi-tech success, in the hopes that they will encourage youth to emulate their example and get serious about the subjects that are the building blocks of the hi-tech future – math, science, and of course, computer technology. “We are strong believers in encouraging workers who have made it to give back to society,” Zisapel says.

Radware has indeed made an impact on Israel’s cash-strapped education system, both materially and via employees’ presence in the field. Employees have worked in schools in Bat Yam, says Zisapel, providing training, guidance and inspiration to students who might otherwise have chosen a “lesser path.” In south Tel Aviv, the company runs a unique after-school program, “where we provide intensive guidance for 40 promising students who have the potential to advance, but are having a hard time getting ahead,” Zisapel says. “We provide tutors to work with these students one on one, helping them advance in math, English, and the sciences,” he adds. And that’s not the end of it, either: “We follow their educational careers, helping to keep them on top of their studies, with the result that they are able to live up to their potentials.”

Radware does what it can for more advanced levels of education as well, Zisapel says. The company runs a special program with the Technion, where it takes students with potential from northern development towns and puts them on an educational track to get into the Technion – providing them with the help they need to move from three bagrut units to the five needed to get into top Technion programs, and to score high marks. The company also provides numerous scholarships for university students, and even works with the Technion on developing startups in an incubator.

Of course, Radware isn’t the only company that puts an effort into working with schools and advancing the education of Israeli students, but it is one of the most active – and one of the most modest. There’s barely a hint of the company’s activity in education on its website, and a brief scan of the English-language internet showed almost no mention of the company’s prolific educational work. But Radware isn’t doing this for the fame and glory; the company knows where its Israeli bread is buttered. “There’s a lot of competition out there, from up and coming third world countries,” says Zisapel. “We have no choice but to remain competitive, if we intend to stay ahead.”

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Spring – especially the latter part of it, in May and June, when the weather starts turning warm – is one of the nicest times of year in Israel. It’s close enough to winter that we haven’t forgotten February’s chill, and it’s still not hot enough to make us wish for February’s return, like we do when August rolls around.

But in recent years, Spring in Israel has been about more than inspirational weather; it’s been an inspirational time for anyone who appreciates Israel’s contributions to making the world a more interesting, more efficient, more healthy – and more fun – place. Two recent exhibitions portrayed Israel’s great contributions to making the world a better place – and the progress yet to come.

First on the agenda was the High-Tech Industry Association (formerly the Israel Ventures Association) Conference, held in Jerusalem in early June. The annual conference (first held in 2007) brings together heads of Israeli tech firms, venture capitalists, bankers, investors, and (for now) small companies seeking funding for their “big idea.” Sessions deal with marketing strategy, technology trends, and, of course, financing and investment issues. And this year, there were special sessions dedicated to expanding Israel’s hi-tech reach to partners in India and China, with special sessions held specifically for delegations from those countries.

Represented at the conference are all the major players in Israeli hi-tech – venture capital firms (Carmel, Gemini, Genesis, JVP, and many others.), top corporations (IBM, Microsoft – both sponsors – as well as Nice, ECI, Checkpoint, and others), along with startups that have “made it” – LiveU, PageOnce, Axxana, and others (many of which I have written about – clearly there’s a connection here!). The conference is just what you’d expect; a little geeky (it was at a presentation by Amdocs that I heard an exposition of the “Terra Play” – more about that next week), a little glamorous (there were some very big “big shots” there), but mostly lots of fun. And educational!

Not to take away anything from the HTIA, but the follow-up show about a week after the Jerusalem conference – the Israel Life Sciences Industry BioMed show – is in a class unto itself. Said to be the largest medical industry trade and technology show outside the United States, BioMed in Tel Aviv attracted thousands of visitors (some 7,000, according to show organizers), with sessions discussing the latest advances in medical devices, pharmaceuticals,  biotechnology, government approval issues, patent issues, ethical issues, and much more.  According to ILSI, first 2010 quarter exports of the Israeli life sciences industry in 2010 totaled $ 1.7 billion, an increase of about 14% over Q1 2009.

Here, too, top players from Israel – and around the world – were in attendance, sponsoring events and giving presentations. At least four U.S. cities and states and half a dozen European governments were also at the event, looking to make deals with Israeli partners or venture capitalists, who were also on the scene. Israeli universities and venture capital accelerators, where many of tomorrow’s innovations are being created right now, were also well represented.  As far as companies making presentations or sponsoring booths – name a big pharma or medical device player, and they were probably there.

It’s heartwarming to see industries celebrating themselves, but I’m a bit coldhearted – I tend to shy away from the glamor and glitz. When I go to these shows, I don’t seek out the “fat cats,” who can afford fully-staffed PR agencies and inundate you with press releases; I’m interested in the sleek, skinny “alley cats” – the outsiders looking in, the ones who struggle for a piece of the pie, trying to sell themselves to an angel. Companies with a great idea, but without the connections – the ones who, with a little luck, could become the big players at next year’s conferences. That’s the kind of story you buy a newspaper for!

Those are the kinds of companies I sought out at both conferences, and fortunately for me, the organizers made it easy, with the newest startups occupying areas on the fringes of the shows. Naturally, the snacks weren’t as good in these outlying areas, but that’s to be expected, I suppose. But what they lacked in materialism – lacking the “good” chocolate croissants, as well as major funding – they made up for in spunk, gumption and moxie, presenting the ideas and products that may become tomorrow’s must-have technology.

Ideas like these: a product that takes even lo-res cellphone camera pictures and turns them into high-resolution, high-definition beauties (HTIA); a cellphone app that lets you get personalized coupons and offers, and lets you connect with other users, when you walk into a store or a mall (HTIA);  a matchmaker service that lets startups easily find angels and VC’s interested in investing with them (HTIA); a product that will keep track of every piece of equipment in a huge hospital complex, so that a stretcher, bed, or defibrillator can always be found when it’s needed (BioMed); a device to treat wounds using ultrasound (BioMed); and a revolutionary and inexpensive device that promises to put laser dental technology in the hands of every dentists – with the device 15 times more accurate than those already on the market (BioMed). It’s appropriate these two conferences are in the Spring, the season of hope; considering the innovations presented by these and many other companies at the shows, Israeli hi-tech and life sciences has a lot to be hopeful about!

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They may be owned by large multinationals, but the research and development centers in Israel are more like startups, at least in spirit – tackling thorny problems for their parent companies, and inventing new products and services that sometimes go on to change the direction of the multinationals, who find that the new product developed by their Israeli R&D unit has given them access to whole new markets and customers!

Like a startup, an R&D center is expected to be innovative, flexible, and to generate new investments for its owners, which essentially acts as a combined VC fund and angel for the R&D “startup.” As Microsoft says about its Israeli R&D unit, “the Israel R&D Center also serves as an anchor to the Venture Capital industry and the start up community, facilitating technology and business cooperation between the industry and Microsoft’s product groups.” Without innovation, large companies end up stultifying – and many of them rely on their R&D units to come up with the new innovations that will allow them to maintain their edge in the market. And many multinationals see Israel as their best bet when it comes to R&D, because of Israel’s proven track record when it comes to innovation.

That’s how Avraham Credi, Director of the local Motorola Design Center and a Vice President of  Motorola Israel, sees it. “A number of important developments have emerged from the Israeli Design Center, and they are an excellent example of Israeli innovation” – among the chief reasons the company opened their research center here, already in 1964 – the first multinational to open such a center in Israel, since joined by Microsoft, Intel, Google, and other giants.

Among Motorola’s “made in Israel” developments was the Spirit, “the first permanent phone for motor vehicles. The initial development for the device was done in Israel, and it represented a significant improvement – especially in the realm of safety – for drivers who wished to speak while on the road, thanks to the device’s ability to recognize a speaker’s voice. The design was also innovative and the quality was first-rate – and the Spirit quickly became very popular. Later generations of the Spirit – both the phone and two-way communicator models – were also developed in Israel, as well as at Motorola Design Centers in the U.S. and Europe” – but it was the Israeli facility that blazed the trail for Motorola, says Credi.

Another Motorola product developed largely in Israel, says Credi, is the company’s Motobridge solution – a system that allows incompatible voice communications systems to connect automatically, allowing, for example, rescue teams, such as police, fire, medical assistance, etc., to communicate over a single network in times of emergency. “The system came out of the 9/11 terror attack, when the various rescue services found they were unable to communicate with each other in real time. The Motobridge allows users of different communication systems – using different radio frequencies, for example – in an efficient and dynamic manner, in real time,” says Credi, adding that the system helped Florida prevent 2005’s Hurricane Wilma (http://tinyurl.com/dotjc) turn into that state’s version of the Hurricane Katrina tragedy. “Florida had already installed a Motobridge system, and state officials later said that the enhanced ability of rescue personnel to keep each other informed probably saved thousands of lives,” he adds.

Motorola may have been first, but other multinationals – like IBM – quickly followed. In a recent interview with the Post, IBM Israel CEO Meir Nissensohn described his company’s work in Israel.  “We had the privilege of opening the first R&D lab, in 1972, when we established the IBM Science Center, developing projects in the medical, agricultural, and other fields,” Nissensohn says.

IBM now has three research labs in Israel, with over 1,000 people working in the units – and the company’s Haifa research lab is IBM’s largest outside the U.S. Among the recent contributions of Israel to IBM worldwide has been the R&D facility’s work on storage – facilitated by IBM’s recent acquisition of  XIV,  FilesX, and  Diligent Technologies – acquisitions that made IBM the largest foreign investor in Israel during 2008, says Nissensohn. “Israelis are very big on innovation, which is key for any corporation today, including ours. There is a huge amount of innovation on all levels in Israel, and the workforce is well educated and motivated,” he adds.

It’s not just the “traditional” hi-tech companies that seek to take advantage of Israel’s R&D capabilities; younger multinationals, such as Google, have a strong presence here – with two research and development centers, a singular honor “usually reserved for large countries, like Russia and China,” Meir Brand, Google Israel CEO, told the Post recently. “It’s an indication of just how advanced Israel’s hi-tech capabilities are that the company would open two R&D centers here,” in Tel Aviv and in Haifa.

About 100 people work at both centers, Brand says, working on products such as Google Trends, which lets you research and compare what people are looking for online, contests and annotations for Youtube, and Google Insights for Search, which lets you compare search volume patterns across specific categories, time frames, and regions. “We’ve found a huge pool of scientists, engineers and mathematicians full of innovative ideas. Israelis tend to think ‘out of the box,’ a trait highly valued at Google,” says Brand.

I could go on and on – but you get the idea. Multinationals like Microsoft, Cisco, and many others see their R&D centers as a great vehicle with which to tap into the “startup spirit” of Israeli tech professionals. In the words of Microsoft Israel CEO Danny Yamin, “Microsoft sees Israel as an excellent source of innovative workers, and we at MS Israel are proud of our contribution to Microsoft’s worldwide development.” And Cisco’s Israel director Bina Rezinovsky recently told the Post that “Israelis are imaginative, and they are familiar with technology, two traits that make the human resources of the country very valuable to Cisco” – and they’re just the traits that make startups so dynamic and innovative. Times may be tough, but they won’t be forever – and when the economy does improve, Israeli tech will be in a position to roar ahead, with the multinationals continuing to tap into their R&D “startups” for their next big thing!

Hi-tech isn’t just about esoteric databases and developing trailblazer technologies. At the bottom line, it’s really all about the bottom line: Making money.

Case in point: The TV weather person. While we all turn on the TV news once a day or so because it’s what informed people do, we all know in advance what to expect: War, tragedy, greed, scandal, etc. Same old, same old. We could be watching last year’s edition, for the depth of variety and innovation.

That’s why they put the “expanded forecast” with the maps and the “personality” on last; the TV executives know why you’re watching, and they want you to keep it on for as long as the broadcast lasts in order to boost the ratings. The weather, unlike the “hard” news items, contains an element of surprise, and appeals to our sense of trying to control the future; the weather person is like a fortune teller, predicting what will happen in the next three to five days. The better the prediction, the more “control” the prophet has over upcoming events.

Or something like that.

Bottom line: The more accurate the forecast, the more people will be drawn to watch the news, and the more bragging rights the station/forecaster will have, which can be used to attract even more viewers, thereby generating higher ratings and more cash per advertising minute on the broadcast.

So: Far from being a stodgy science with a funny name – “meteorology” – weather forecasting is about dollars, cents and shekels, and it shouldn’t at all be surprising that hi-tech companies would throw their computerized heart and soul into developing ways to use programming and processing to better predict the weather.

Successful weather prediction is a function of two things, says Dr. Barry Lynn, of Weather-It-Is - processing power, and an accurate forecasting model. Dr. Lynn (he’s a doctor of meteorology, in fact) has a forecasting model that he prefers to work with – the Weather Research and Forecasting Model – the processing power to break down weather forecasting for areas as small as 10 kilometer square (i.e., specific forecasts for small areas), and his own programmed algorithms for predicting accurately – more accurately than most – exactly what the weather is going “to do,” as most of us put it.

And it’s not just about providing TV newscasts with higher ratings; improved and more accurate weather prediction could be a boon for many industries that need to wrestle the environmental elements in order to get work done. Take an electric company crew that needs to do major line work, for example. These guys get paid a huge hunk of change for field work, and if the company sends them out on a job, while they sit in the truck instead of working because a surprise electrical storm has made it too dangerous to work, the company – and, of course, its customers – end up footing that bill. An accurate weather prediction for the specific area in question is valuable information for the utility, says Dr. Lynn, and they’ll pay – as will oil and gas drillers, farmers, airports and a host of other industries and services.

But surely major weather prediction services have already seen this market and taken advantage of advanced technology to come up with more accurate models. Not necessarily, says Dr. Lynn, and certainly not everywhere. Among the problems is that many of the weather services (at least outside the US) are tied to government or educational institutions, and we all know how they can be about changing their methods and/or approaches to solving problems. Much of the prediction algorithms in use are built on less accurate (i.e. more primitive) models, and rewriting them would of course entail a lot of time and money. And the better commercial ventures that do exist serve only the “top” markets in the US and Europe – and charge a hefty fee for their services. Wide swaths of the world, including much of Asia and the Middle East, and all of Africa, are not covered by any advanced service.

And often, it’s these developing countries, especially in Africa, that could truly benefit from enhance weather prediction.

Closer to home, some experts charge that the Israel Meteorological Service bases its forecasts on an inaccurate model and last-generation software.

“It’s not really their fault,” Dr. Lynn says, “because their budget is so small, they can’t afford new equipment.”

Nevertheless, he said, the IMS charges a lot of money for their so-so service – while his predictions have more often than not been much more accurate.

Case in point: The threatened snowstorm that eventually did hit Jerusalem in January. Having a vested interest in knowing what to expect, since I was scheduled to drive into and out of the city on storm day, I followed the detailed forecast on Israel Radio closely. As Dr. Lynn reminded me, and as indeed I noticed myself, the weather service changed its forecast at least three times in the days preceding the storm, first predicting a sizable (for Jerusalem) layer of snow on the ground, then backing off altogether, saying the storm would bring no more than freezing rain, and then, in the immediate hours before the storm, a prediction that snow would indeed fall and that there would be a modest accumulation – the prediction, Dr. Lynn said, that he had already made on his Web site days before the storm hit.

So, there’s plenty of opportunity close to home – as well as in neighboring countries, including Egypt, Lebanon and Jordan, which have almost no weather forecasting services to speak of. Dr. Lynn’s site has city by city and region by region breakdowns for all these countries, as well as, of course, for Israel, and the forecast for each area analyzes in depth the available information and produces a unique prediction for what residents of each specific city can expect – unlike the IMS, which produces forecasts by wide regions. But even though they are both in the North, Safed and Haifa have radically different weather – even Haifa and Carmiel can often expect different conditions. Dr. Lynn’s site takes into account these differences and produces a what he says is a more accurate forecast for these and dozens of other localities in Israel and the rest of the Middle East.

The fledgling company is expanding, and hopes to be able to implement 10 kilometer area predictions in the very near future (after they acquire some more processing power). Dr. Lynn said that his company had worked out a deal to supply information to a forecasting company called Nooly, and that Channel 10’s weather “personality,” Danny Rupp, will use the company’s data in upcoming forecasts.

Meanwhile, you can check out what Dr. Lynn predicts at his site, http://www.weather-it-is-israel.com, for your town – and maybe soon, for your street!

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