2009: Sarah Lacy and the Israeli Web Revisited

Guest post by TechAviv.com contributor Lisa Damast of Israel Innovation 2.0.

Nine months ago there was talk and speculation that Israel’s Web sector was done and not likely to recover. Mainly expressed by TechCrunch editor-at-large Sarah Lacy after her visit to Israel in March, at the time she wrote about her disappointment with Israeli Web startups except for MyHeritage and a few others. Her piece caused an uproar among Israelis on Twitter and in the blogosphere, including onĀ TechAviv.

At the time Lacy wasn’t completely off. It had been a while since an Israeli Web startup had a big exit or received a large investment or a lot of media attention. Combining this with the poor economy and the rise of Israel’s cleantech sector (which continues to grow), it seemed that Israeli innovation in the Web space had peaked when Shopping.com was purchased by eBay in 2005.

By September of this year though it became clear that 2009 was actually the resurrection of Israel’s Web industry and that Israeli entrepreneurs did not lose their mojo as Lacy had suggested they did. At TechCrunch50 in San Francisco Israeli startups received the three top prizes for their promising technologies: Trollim, Red Beacon and AnyClip. A few weeks later in October, it was revealed that Answers.com, perhaps the most memorable Israeli site to have survived the dot.com bust and to thrive, was the 13th most visited Website in September.

In addition to these sites, the second half of 2009 saw the rise of another part of Israel’s Web industry, Facebook and mobile applications. In November the Facebook facial-recognition application Face.com went live and in December the community-generated traffic tracking mobile application Waze started to make headway in the U.S. market, among other regions.

While most of these companies still need to prove themselves (with growth, revenue and exits…) it is clear that there is a new drive among Israeli Web entrepreneurs and Israel’s Web industry is reemerging. 2010 will be an interesting year to see what happens to these startups and if the newfound mojo will reverse the investment decline of recent years in the sector.

Tags: , , ,

Categories: 2 shekels, Innovation, Startups

3 Comments on “2009: Sarah Lacy and the Israeli Web Revisited”

  1. dt
    December 24, 2009 at 5:28 am #

    Sarah La[c|z]y seems to disgust everyone (Argentina, Brasil also).
    I think she doesn’t deserve any journalist credit.

  2. Yaron
    December 24, 2009 at 5:48 am #

    I wouldn’t say that, she’s actually a very entertaining and insightful writer, she just had some key data points wrong in her post about Israel. Happens all the time. Would have liked to see her correct the post after getting the correct data but its all good. Israeli startups get enough positive ink on TechCrunch to correct any misconceptions about the countries “mojo”.

  3. Lisa
    December 24, 2009 at 6:07 am #

    To add to @yaron’s comment, Sarah Lacy is a master at creating controversy that starts conversations that should be discussed. She may blow things out of proportion but there is always some underlying truth and issue there. Though she’s wrong about Israeli entrepreneurs still innovating in the Web space, her post helped spark discussions about issues in the sector that need to be talked about and addressed for these startups and others to attract significant investments and really thrive.

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