Israeli company Lexifone, which has developed technology for simultaneous translation of telephone calls, has signed a memorandum of understanding for the establishment of a development center in Changzhou, China. Under the agreement between the company and the city representatives, the local administration of Changzhou will participate in Lexifone's forthcoming $10 million financing round. So far, the company has raised $2.5 million from, among other investors, Intertainment Media of Canada, which owns 25% of it.
Lexifone was founded in 2010 by Dr. Ike Sagie, who was one of the founders of Attunity Inc. (Bulletin Board: ATTUF). The company, which began life in the hiCenter incubator in Haifa, has developed a multi-lingual voice dictionary for use with mobile telephones. The system provides translation for speakers of different languages talking by telephone or in face-to-face meetings. The Chinese development center will employ ten people to develop a component of the system for the Chinese market.
According to Zvi Shalgo, CEO of PTL Group which arranged the collaboration with Changzhou, the reason for Israeli companies to establish themselves in the Chinese market is mainly the Asian market, to which access is simpler from offices in China. However, the path to China requires first of all a radical change in thinking by local entrepreneurs, who do not always feel comfortable in a Chinese business environment. "It is necessary to find a model that will make a small Israeli start-up company feel comfortable opening a Chinese branch," says Shalgo. Under the current agreement, the administration in Changzhou will receive shares in Lexifone in return for an investment that could amount to several million dollars.
Published by Globes [online], Israel business news - www.globes-online.com - on March 21, 2013
© Copyright of Globes Publisher Itonut (1983) Ltd. 2013
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