What Chinese investors should know before tackling Israel

shutterstock_151193558 israel

If you ask Alan Feld what Chinese investors should know before investing in Israeli startups, his answer is simple: a trusted, local partner.

“Investing is very much a local business,” he explains.

Feld is the cofounder and managing partner of Vintage Investment Partners, Israel’s only active fund of funds. They manage about $1 billion dollars in funds and discretionary accounts across Israel, the U.S, and Europe. These include secondary funds, or holdings in other private equity and venture capital investments, co-investments in late-stage companies, and a fund of funds.

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But Vintage Investment Partners isn’t just about leveraging money. One of the company’s most valuable assets is its massive database. Their proprietary database includes more than 4,000 venture and private equity-backed companies in Israel, the U.S, and Europe, as well as more than 3,000 investors.

“We see about twenty companies a week,” says Feld. He and his team will drive around Israel, where companies are two hours away at most, and meet different entrepreneurs, companies, and investors. Feld also conducts similar meetings in Berlin, London, Stockholm, and other cities outside of Israel.

In doing so, Vintage Investment Partners not only does due diligence on its underlying companies, but also grows its enormous, cross-continental network. The investment firm can then use its database to connect investors, companies, and entrepreneurs to the right contacts for sourcing talent, business partnerships, and more. Offered as a free service, this strengthens and helps the firm expand its network even further.

For Chinese investors interested in Israeli startups, Vintage Investment Partners’ database could prove crucial. Israel is home to thousands of startups – the most startups per capita in the world – which can be challenging to navigate for any investor or firm without local or detailed knowledge about Israel’s startup ecosystem.

Not that that’s stopped Chinese investors. Famous Chinese investor Li Ka Shing and his Horizon Venture fund have invested in 29 Israeli startups and were early investors in Waze, a crowd-sourced navigation app that Google acquired for $1.15 billion in 2013. Alibaba, Baidu, Fosun, Renren, Tencent have also poured investments into Israel’s startup ecosystem, which boasted about $15 billion USD worth in exits last year and eighteen IPOs.

At the same time, Israeli startups are looking to scale into larger markets like China’s. MoovIt, an app that provides different services to public transportation commuters, such as trip planning, service alerts, and more, plans on launching in Hong Kong, Guangzhou, Shanghai, and Beijing. Last year, the social investing platform eToro secured an equity round from Ping An Ventures, a Chinese venture capital firm.

“I want Chinese investors to have a good experience in Israel,” says Feld. “And Israel could be a bit of a bridge. It could be a conduit between China and the U.S, and China and Europe.”

According to Feld, some trends to look out for in Israel’s technology world include cybersecurity, cloud technology, and computer vision startups, such as JustVisual and Cortica.

Image credit: Shutterstock

This story originally appeared on TechNode.

Baidu Music, with 150M monthly active users, beefs up its offering as Apple invades


It’s possible that Apple Music’s launch in China at the end of September has put local rival Baidu Music on the defensive. Today, Baidu is announcing plans to merge its music-streaming service with Taihe Entertainment Group, one of China’s leading music service providers.

The deal is expected to bring Taihe’s “extensive intellectual property… [and] artists and repertoire (A&R) resources” to Baidu Music’s “powerful downstream digital platform and distribution capabilities,” according to a release.

Specifically, Taihe holds the rights to more than 700,000 recordings, as well as “long-term cooperation agreements with hundreds of international and domestic music institutions.”

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Baidu, meanwhile, now boasts 150 million monthly active users — though it’s not clear how many of those are paying customers.

Baidu Music costs around $1-2 per month (depending on RMB currency fluctuations with the USD), putting it head-to-head with Apple Music in the country (Apple’s offering is available at a similar price point in the China market).

But it’s unlikely that Baidu sees more than a negligible percentage of paying subscribers. Most will be using the service’s basic free offering, in the same way that Spotify users can enjoy a limited service for free.

While undoubtedly a household name to Chinese consumers, it’s unlikely that Baidu’s music-streaming service commands the same premium brand image that Apple enjoys — meaning Baidu may find it tougher to persuade users to pay.

Users that can afford to pay will likely seriously consider Apple Music, instead.

“As the intellectual property regime continues to improve in China and users are increasingly willing to pay for online content, prospects for the Chinese digital music industry look increasingly bright,” Baidu said.

The company cited research by Analysys expecting China’s digital music market to reach about $2.15 billion this year, a 30 percent jump on 2014. That could grow to about $2.8 billion by 2017.

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At COP 21, Plume Labs launches live map of air pollution around the world

World Air Map by Plume Labs - animated

As the U.N. climate summit in Paris gets underway this week, a French startup has launched a live map of air pollution to show which cities are suffering the worst. (Hint: Check out China!)

The World Air Map is produced by Plume Labs, a Paris startup that debuted earlier this year. Plume pulls pollution data from monitoring stations around the worlds and makes the info available through an app on smartphones.

According to Plume founder Romain Lacombe, the company’s goal is to make the information available to people in a way that helps them make decisions every day to protect their health.

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But as the so-called COP 21 summit is starting, Plume saw this as an opportunity to use its data to create a more global picture of air pollution levels. The World Air Map pulls data from more than 150 monitoring stations and displays it in expanding and shrinking balls that change colors. The colors range from light blue, which indicate less air pollution to almost-black which indicates extreme air pollution.

At the moment, people choking to death on smog in Beijing may not need an app or map to tell them the air pollution is horrific. But still, the app and map track small changes up and down that will let people watch for moments in their neighborhood when the air is less toxic.

Of course, Lacombe is hopeful that by visualizing this data on a global scale and making it easily accessible that Plume will add to the sense of urgency surrounding the negotiations to reduce emissions.

“There are a lot of important policy discussions,” Lacombe said. “But certainly tech has a role to play in this crisis.”


Above: Good times in Beijing as smog levels reach new records. Source: Reuters



















A cloning company wants to produce up to 1 million cattle a year starting in 2016


What costs $500 million USD and can churn out up to 1 million cattle embryos a year? A new livestock cloning facility in north China is hoping to do just that, starting production in the first half of 2016, according to one of the companies involved.

The project is a joint venture between Boyalife Group, Peking University, the Tianjin International Joint Academy of Biomedicine and Korea-based biotech foundation Sooam.

Along with cattle, the plant also plans to produce sniffer dogs, pet dogs, and racehorses. While cloning projects have been undertaken by Chinese scientists since the early 2000s, there is yet to be a commercial enterprise for cloned livestock.

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Boyalife says in a release that they have cloned three Tibetan mastiff puppies as part of their first joint venture with Sooam in September 2014. However increasing output to 1 million head of cattle per year seems somewhat unrealistic in the near future.

The company says it will start with 100,000 cattle per year, scaling up to the 1 million mark in an unspecified time range.

Chairman of Boyalife says that “Chinese farmers are struggling to produce enough beef cattle to meet market demand.”

China’s demand for beef is indeed rising, with live exports expected to double to 200,000 in 2016. China is expected to consume 7.4 million tonnes of beef in 2016, with the country expected to produce approximately 90% of that amount according to the USDA Foreign Agriculture Service.

Recently Australia signed a hotly debated deal to allow 1 million head of annual live exports to China beginning in 2016. Interestingly, it’s exactly the same amount Boyalife and Sooam are hoping to ‘manufacture’ in their single cloning facility.

Boyalife says the project will also include a research laboratory, gene bank, and museum.

Currently beef consumption sits at just 15% that of pork due to prohibitive pricing. As China’s middle class expands, the demand for reasonably priced beef could bolster cloning projects. However China is still in the process of opening itself up to new markets for beef imports, including Brazil.

This year the European Parliament voted in favor of a ban on similar commercial cloning techniques citing animal welfare issues.

This story originally appeared on TechNode.

On China’s fringes, cyber spies raise their game

An employee operates a forklift to transport a pallet stacked with bundles of the Apple Daily newspaper, published by Next Media, at the company's printing facility in Hong Kong, China November 26, 2015.

(By Clare Baldwin, James Pomfret, Jeremy Wagstaff, Reuters) – Almost a year after students ended pro-democracy street protests in Hong Kong, they face an online battle against what Western security experts say are China-sponsored hackers using techniques rarely seen elsewhere.

Hackers have expanded their attacks to parking malware on popular file-sharing services including Dropbox and Google Drive to trap victims into downloading infected files and compromising sensitive information. They also use more sophisticated tactics, honing in on specific targets through so-called ‘white lists’ that only infect certain visitors to compromised websites.

Security experts say such techniques are only used by sophisticated hackers from China and Russia, usually for surveillance and information extraction.

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The level of hacking is a sign, they say, of how important China views Hong Kong, where 79 days of protests late last year brought parts of the territory, a major regional financial hub, to a standstill. The scale of the protests raised concerns in Beijing about political unrest on China’s periphery.

“We’re the most co-ordinated opposition group on Chinese soil, (and) have a reasonable assumption that Beijing is behind the hacking,” said Lam Cheuk-ting, chief executive of Hong Kong’s Democratic Party, which says it has been a victim of cyber attacks on its website and some members’ email accounts.

U.S.-based Internet security company FireEye said the attacks via Dropbox were aimed at “precisely those whose networks Beijing would seek to monitor”, and could provide China with advance warning of protests and information on pro-democracy leaders. The company said half its customers in Hong Kong and Taiwan were attacked by government and professional hackers in the first half of this year – two and a half times the global average.

China’s Ministry of Foreign Affairs, Public Security Bureau and the Liaison Office of the Central People’s Government in the Hong Kong Special Administrative Region did not respond to requests for comment. The Defence Ministry said the issue was not part of its remit. China has previously denied accusations of hacking, calling them groundless, and saying it is a victim.

The Hong Kong police said its Cyber Security and Technology Crime Bureau works with other law enforcement agencies to combat cross-border crime, but did not respond to questions on how much information it shares with mainland Chinese authorities, the origin of the Hong Kong cyber attacks, or whether these might be a source of instability or concern.

Police data show a drop in reported “unauthorized access”, which includes Internet or email account abuse and hacking, over the past two years. Many of the victims Reuters spoke to said they hadn’t bothered to report being hacked.

Switching tactics

Like other groups taking on the might of Beijing – from Uighurs and exiled Tibetans to some Taiwanese – Hong Kong activists, academics and journalists have become more savvy and adopted tactics that, in turn, force hackers to get savvier still.

When Tibetan exile groups stopped clicking on files attached to emails, to avoid falling victim to a common form of ‘spear phishing’ attack, hackers switched their malware to Google Drive, hoping victims would think these files were safer, said Citizen Lab, a Canada-based research organization which works with Tibetans and other NGOs.

Hackers also recently used Dropbox to lure Chinese language journalists in Hong Kong into downloading infected files. FireEye, which discovered the attack, said it was the first time it had seen this approach.

“We don’t have any arrogance to think we can beat them,” said Mark Simon, senior executive at the parent company of Hong Kong’s Apple Daily, a media group on the front line of the attacks.

Strange words

Trying to stay ahead of the hackers, activists and others use multiple mobile phones with different SIM chips, encrypted messaging apps, apps that automatically delete tweets, and code words to set up meetings. If someone thinks they may be arrested, they remove themselves from group chats.

Some things are kept offline.

“If we want to talk, we have some signal,” said Derek Lam, a member of student group Scholarism that helped organize the protests. “It’s a few words … if I say some words that are really strange it means we have to talk somewhere privately.”

Law professor and protest organizer Benny Tai stores personal data, such as names, email addresses and mobile numbers, on an external hard drive that he says he only accesses on a computer without an Internet connection.

The pro-democracy Apple Daily, which says it is hacked on an almost weekly basis, has tightened its email security software, and has its lawyers use couriers rather than email. FireEye last year connected denial of service (DDoS) attacks against Apple Daily with more professional cyber spying attacks, saying there may be a “common quartermaster”. It said China’s government would be the entity most interested in these “political objectives”.

Sophisticated hacks

Steven Adair, co-founder of U.S.-based security firm Volexity, said that code hidden on pro-democracy websites last year, including those of the Democratic Party and the Alliance for True Democracy, suggested a group he said “we strongly suspect to be Chinese… who is very well resourced.”

He said such tactics were more usually seen employed by Russian hackers, aimed at very specific targets and designed to be as unobtrusive as possible. “It’s a real evolution in targeting,” he said.

In the run-up to Hong Kong district council elections earlier this month, hackers used more basic techniques, breaking into at least 20 Gmail accounts at the Democratic Party, according to party officials and Google logs seen by Reuters.

Between April and June, many hacked accounts were forwarding emails to [email protected] An examination of the hackers’ IP addresses by the party’s IT experts found some appeared to originate in China, party officials said.

(Reporting by Clare Baldwin and James Pomfret in HONG KONG and Jeremy Wagstaff in SINGAPORE, with additional reporting by Teenie Ho in HONG KONG and Michael Martina and Ben Blanchard in BEIJING; Editing by Ian Geoghegan)

The Pepsi Phone may not reach its crowdfunding goal

pepsi phone

Last month we detailed the upcoming Pepsi smartphone, a mid-range smartphone model that would share the beverage brand for a China-only release.

The device launched on JD’s crowdfunding site JD Finance this month and has been live for a week, attracting significant media attention. However with only eight days left it’s yet to reach half of its 3 million RMB ($470,000 USD) goal.

Pepsi has chosen to partner with Koobee, a lesser-known Chinese smartphone vendor, to push the phone valued at approximately $250 USD (the price of the Koobee H7, which features virtually identical specs).

Those who got in early paid less than $78 USD for the a version of the limited edition phone, while early bird-options are still available for approximately $110 USD. After that users will have to pay $156 USD for the phone, or just over $200 USD for a combo including the phone and a selfie stick.

Screen Shot 2015-11-25 at 6.46.51 PM

The phone itself features a 5.5-inch 1080p display with 16GB of internal storage, 2GB of RAM and a fingerprint sensor located on the back of the device. Design-wise, there are hints of the Huawei Mate S that come to mind, though it’s definitely participating in a lower price range.

Limited release branded smartphones are not unusual in the Chinese market. This year ZTE launched an NBA version of their Axon Mini exclusively to the Chinese market, drawing on the popularity of the NBA franchise in China to boost the sales of their latest flagship.

This story originally appeared on TechNode.

The Many Ways Of WeChat: How Messaging Is Eating The World

message in a bottle In February 2011, I visited my friend Bill Huang who worked for Tencent in Shenzhen. Bill was telling me about their new messaging app, called WeChat, that had just launched. At the time, I had been using WhatsApp for more than a year. I asked Bill why they would build a copycat. His reply? He simply insisted that I download the app and take it for a spin. That night, I went home to Hong Kong… Read More

The Many Ways Of WeChat: How Messaging Is Eating The World

message in a bottle In February 2011, I visited my friend Bill Huang who worked for Tencent in Shenzhen. Bill was telling me about their new messaging app, called WeChat, that had just launched. At the time, I had been using WhatsApp for more than a year. I asked Bill why they would build a copycat. His reply? He simply insisted that I download the app and take it for a spin. That night, I went home to Hong Kong… Read More