Israel

Facebook Acquires Israeli Start-Up Onavo for Over $100 Million

In a story published last week about Israeli innovation, The Tower noted that stories about record-setting acquisitions by U.S. technology giants are becoming fairly routine. The specific post described how Israel had just been ranked among world leaders in the development of human capital, and the mention of routine tech acquisitions linked to another story about Google’s billion dollar acquisition of Israeli startup Waze.

Facebook had reportedly been in competition with Google for Waze, and the purchase would have given the social media company its first presence in Israel. This week brought news that Facebook is securing that foothold anyway, via the purchase of another Israeli startup:

The big draw for Facebook is Onavo’s pioneering data compression technology, which helps smartphones cut data consumption as much as 80 percent…. “We expect Onavo’s data compression technology to play a central role in our mission to connect more people to the Internet, and their analytic tools will help us provide better, more efficient mobile products,” a Facebook spokesman said.

The sale price was not disclosed publicly but was estimated by experts as being north of $100 million.

Coverage around the sale has emphasized the sheer amount of technical talent in Israel:

“Facebook was amazed by the amount of talent in such a small country like Israel,” Nicola Mendelsohn—a Facebook vice president who heads the company’s European, Middle East and Africa branch—told Israeli President Shimon Peres at a technology conference in Tel Aviv just days after its acquisition of Israeli startup Onavo, Globes reported.

Facebook is also slated its first research and development center outside of the United States in Israel.

Israel’s “high tech niche and entrepreneurial culture” was recently cited by Moody’s as a key factor in the ratings agency reaffirming Israel’s A1 raiting. Warren Buffett over the summer described the Jewish state as “the leading, largest and most promising investment hub outside the United States.”

[Photo: Onavo / YouTube]