BloGiza

Giza's Ofek Program

I've been having quite a lot of face time with entrepreneurs at various networking events recently. While talking to people in the biz, a number of questions about Giza seem to pop up repeatedly. One is "you guys do Internet?" and the other is "you guys do seed investing?"

The fact that people are surprised that the answer to both questions is "yes" means that we're not getting our message out strongly enough.

Which brings me to the Ofek Program.

Giza has a special program which we call Ofek devoted to very early stage investments. Giza makes relatively small investments (generally up to $500K in the form of a convertible loan) in startups at the seed or even pre-seed stage. The initial investment is usually milestone-based and is intended to bring the company to a significant stage of development.

Assuming that the milestone goals have been met and the company still seems like a good investment, Giza will then look to lead the first institutional round.

We generally look at companies in the Internet/New Media/Gaming space as the best candidates for Ofek investments, given that their initial funding needs tend to be lower than those in other sectors of high tech. In the last 18 months, Giza has made 6 such investments. Two of these Ofek projects -- YaData and Koolanoo have already graduated to the status of portfolio companies.

With Ofek investments, we try to move as quickly as possible in order to make the decision-making process as simple as possible. In short, Ofek is our way of acting like Angel investors.

So spread the word: Giza does pre-seed and seed investing, and Giza does Internet investments. We'll be delighted to hear your ideas.

Play as You Go

Full disclosure: This post is about one of our portfolio companies. But it is a pretty cool company.

So at the risk of being accused of eating our own dog food, we invite everybody to try PlayOn Arcade.

PlayOn Arcade is a casual gaming site with a difference. Most casual games sites let you play free for an hour, after which you need to download the full version of the game and pay $20.

Here, you pay only for what you play. Instead of committing to any one game, you open up a PlayOn account which allows you to play all the games on the site for 1 cent a minute. The first hour of each game is still free, and if you play more than $20 worth of any one title, the game is yours to keep. No risk.

PlayOn is powered by Double Trump, one of Giza's portfolio companies, and a leader in the burgeoning field of micro-licensing. It's a new concept, but one which we feel has a lot of potential both for the gaming world and beyond.

In the meantime, they are helping turn me into a huge Diner Dash addict. But that's another story.

Virtual Big Blue

CNet has an interview today with Irving Wladawsky-Berger, IBM's head of technical strategy and innovation, who has pioneered Big Blue's entry into the world of Second Life. Come January, IBM will open up a business unit focused on virtual worlds such as SL. The new EBO hopes to use Second Life for purposes of training, conferences, and commerce.

I'm still not sure what to make of all the recent fuss about Second Life. On the one hand, it does look like a number of companies (Reuters, Dell, Sun) have decided to establish their virtual presence in Linden Land. On the other hand, one can't help shake the feeling that this is all a big fad that will have been forgotten by next year.

(For a thorough discussion of the second issue, go here.)

My main takeaway from the interview with Wladawsky-Berger is this quote:

How will Second Life be integrated with other parts of the Internet? Right now, there's not too much overlap.
Wladawsky-Berger: It has to be integrated. We need to make it easy to interoperate with other virtual worlds on the Internet and be able to go back and forth between virtual worlds and Web sites in an easy way. The problem now is the lack of standards like we had with HTTP, HTML (languages for sending and describing Web pages), etc. We need to create them across virtual-world platforms as well as Web sites.

Anybody interested in starting up the world's first  Second Life VC?

At the Geek Garage

The Garage Geeks held its second meeting Thursday night. The occasion was the release of Guitar Hero II , which gave us all the opportunity to spend the evening drinking beer and rocking out.

(For those who haven't tried, it involves classic rock tracks, an obstacle course of sorts, and a customized game controller shaped like a miniature guitar. I wasn't quite able to get the hang of it)

The best part of Garage Geeks is that it gives us Suits on the finance side of Israeli high tech the opportunity to hang out with the entrepreneurs and other techies in a casual setting.

Props to Yossi Vardi who showed up to shmooze as well. A lot has been said about Vardi's commitment to Israel's internet entrepreneurs. But considering that the man probably has many things he could be doing on a Thursday night other than hanging out in an abandoned garage in Holon, it speaks volumes that he made the effort.

Some more pictures from the event: