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Israeli researchers at Check Point Software Technologies Ltd., a leading cybersecurity provider, revealed that hackers were able to steal $1 million from a Chinese venture capital firm earlier this year through a targeted business email compromise (BEC) scam. The money was intended for an Israeli startup.
In a detailed incident response case file this month, Check Point Incident Response Analyst Matan Ben David shared neither the name of the Chinese VC that was targeted nor the one of the Israeli startup that was supposed to be collecting the money as seed funding.
“A Chinese venture capital firm was alerted by their bank that there was an issue with one of their recent wire transactions. A few days later, a young Israeli startup realized they didn’t receive their one million dollars seed funding,” Ben David wrote in the case file, “Both sides got on the phone and quickly realized that their money was stolen.”
As the companies realized the money was gone, they also noticed emails between the two parties that were altered and some correspondence that was fabricated.
It was at this point that they reached out to the Check Point incident response team about the money transfer and the Tel Aviv-based security firm began to go through emails, computers, and server logs.
The hackers had actually done more than just monitor the emails through an auto-forwarding maneuver as is usually seen in traditional BEC cases, Ben David wrote. Check Point said they had actually registered two lookalike domains — one which looked just like the Israeli startup, but which had an additional ‘s’ added to the end, and the other which looked like the domain of the Chinese VC, but also with an ‘s.’
The attacker sent two emails with the same headline as the original thread, with the first sent to the Chinese VC from the Israeli lookalike domain, through a spoof of the email address of the Israel startup’s CEO, according to the research. The second email was sent to the Israeli startup from the Chinese VC’s lookalike domain through a fake email address from the VC account manager handling the investment.
It’s a strategy that gave the attacker the ability to conduct the ultimate Man-In-The-Middle (MITM) attack, Ben David said.
Every email sent by each side was actually sent to the attacker first, who then reviewed the email, decided if content needed to be modified and forwarded the email from the relevant lookalike domain to its original destination, according to the post.
“Throughout the entire course of this attack, the attacker sent 18 emails to the Chinese side and 14 to the Israeli side. Patience, attention to detail and good reconnaissance on the part of the attacker made this attack a success,” Ben David wrote.
The attack, which may have originated in Hong Kong, according to reports, successfully used the MITM strategy to scam the companies and steal funds. The attacker even went as far as sending emails to both parties to cancel a scheduled meeting in Shanghai, which had it occurred, would likely have thwarted the whole scheme.
The attacker, who has yet to be identified, took things further by asking for more money. The Israeli startup’s CFO continues to receive an email a month from the fake CEO account urging him to make a wire transaction, Ben David said.
Check Point offered a number of ways to avoid situations like the one they discovered in a “Lessons Learned / Key Takeaways” portion at the end of the report. These include adding a second verification mechanism by calling the person or calling the receiving party to guarantee the transaction arrived at the intended party and ensuring email infrastructure is able to keep audit and access logs.
Above all, prevention is key, says Check Point. “Email is by far the number one vector for attackers to infiltrate business networks,” according to Ben David.
Phishing emails baiting users to expose organization credentials or click malicious link or files are “the number one threat in the email space.”
(The most famous case of this in recent history is the email hacking of the Democratic National Committee in 2016 and the subsequent event it unleashed.)
“Organizations must always incorporate an email security solution, designed to prevent such attacks automatically utilizing continuously updated security engines,” he wrote.
Adam Neumann, the Israeli-born co-founder of co-working space giant WeWork (We Company) is stepping down as the company’s CEO amid allegations of misbehaviors, including self-dealings, ahead of an expected IPO (initial public offering).
Neumann will continue to serve as non-executive chairman of the board. In a statement released on Tuesday, Neumann said, “As co-founder of WeWork, I am so proud of this team and the incredible company.”
“While our business has never been stronger, in recent weeks, the scrutiny directed toward me has become a significant distraction, and I have decided that it is in the best interest of the company to step down as chief executive.”
The move came less than a week after the Wall Street Journal published a report detailing alleged strange behaviors on the part of Neumann and speculations that the company’s biggest investor, SoftBank, was looking to move him out of a leadership role. Other investors also criticized WeWork’s governance, business model, and its ability to be profitable.
Earlier this year, WeWork was valued at $47 billion and an IPO initially expected last week was postponed after it was estimated that the IPO valuation was a third of that sum – a sharp drop that made investors shaky. They were also “dismayed by the number of potential conflicts of interest” disclosed in the IPO prospectus, WSJ reported, including Neumann “leasing properties he owns back to the company and borrowing heavily against his stock.”
“Even some of We’s private investors said they were angered to learn that an entity Mr. Neumann controls sold the rights to the word ‘We’ to the company for almost $6 million – before public pressure led him to unwind the deal,” according to the report.
Neumann, the Wall Street Journal wrote, led WeWork “with unusual exuberance and excess,” combining “entrepreneurial vision, personal charisma and brash risk-taking [that] helped the company surpass $2 billion in annual revenue, and made it the country’s most valuable startup.”
“Now many of the same qualities that helped fuel his company’s breakneck growth in the private market are piling up as potential liabilities as the company prepares to go public – helmed by a CEO who looks little like a typical public-company chief,” according to the report.
Neumann founded WeWork in 2010 in New York alongside Miguel McKelvey. The company grew quickly, conquering shared workspaces worldwide in under a decade with now more than 500,000 members in 100 cities across 29 countries. One of its first international locations was Tel Aviv, where it now has seven sites. WeWork also works with enterprise customers (members with over 1,000 employees) and Fortune 500 companies, including major ones such as Microsoft, Facebook, Adidas, and Salesforce.
Learn more about Diane Israel. Also, see Diane Israel on LinkedIn.
No one is surprised to know that Israel is no gaming mecca. On the other hand, it’s no wasteland either. Here’s Israel’s top 7 gaming companies and their top titles: (Excerpts of this post were originally published by NoCamels.com)
Playtika is an Israeli social and mobile video game publisher with 11 key titles found on the Apple App Store, Google Play, Windows App Store, Amazon Apps, and Facebook. With six million active monthly users, 27 million active monthly users, and over 280 million installations, Playtika is today’s largest grossing game developer on Facebook.
Since its inception in 2010, Playtika has grown from six employees to 1,500 by adding new members to its diverse family of games and associated developers. A year into its operations, Playtika was acquired in 2011 by online mobile and social game developer, Caesars Interactive Entertainment, a company whose specialization in casino entertainment helped Playtika become the current top social casino games developer on iPhone and Android. In 2016, Playtika was sold once more to a Chinese consortium of companies led by Giant Interactive for a whopping $4.4 billion – one of the largest “exits” by an Israeli company.
Playtika has welcomed innovative independent developers such as Jelly Button (2017) and German casual games company Wooga (2018), as integral additions to its collection of platforms, as well as other leading social game brands like World Series of Poker (2013), House of Fun (2014), and Solitaire Harvest (2019).
Playtika continues to spread its operations across the world as the company moves further into the casual gaming space. With 10 current office locations, Playtika recently opened a $6 million research and development center in Bucharest, Romania – its eighth R&D facility.
Founded in 2009 by Avi and Gabi Shalel and Ilya and Haim Turpiashvili, Plarium is a Herzliya-based game developer for both PC and mobile platforms. With over 10 key titles and a game pipeline across multiple genres, the company’s popular mobile and social games are played daily by over 250 million players in 150 different countries.
In 2017, Australian gaming giant Aristocrat acquired Plarium for $500 million but it operates as a wholly owned subsidiary. The company employs some 1,200 people across its Israeli headquarters and seven offices and development studios in Europe and the United States.
Plarium’s most popular game to date, “Vikings: War of Clans,” has 4.5 million active users and remains in the Apple App Store’s top 50 grossing mobile applications in the US, the UK, the Netherlands, Germany, Canada, Mexico, India, Sweden, and Denmark.
Vikings: War of clans by Plarium. courtesy
Israeli mobile game developer TabTale has released over 500 original and licensed games including the immensely popular Run Sausage Run – which logged more than 21 million downloads in its first two months – and over 50 million downloads to date. The game appeared as the number one casual game in 20 different countries upon release.
TabTale has repeatedly been ranked by AppAnnie analytics firm as a Top 10 Mobile Games Publisher and since its first hit mobile app in 2010, interactive storybook Christmas Tale HD, the company has reached over two billion downloads.
Today, many of TabTale’s most popular games are those designed to educate kids and stimulate creativity such as Babysitter First Day Mania, where they can feed, bathe, and take care of babies; Hercules Falls…in Love where kids can help the Roman demigod adjust to life and romance on earth; and Paint Sparkles, the number one Kids Coloring App worldwide, in which kids can color with a variety of drawing tools on over 270 coloring templates.
TabTale has offices in seven countries including Israel, China, Serbia, and Bulgaria.
With over 10 million monthly active users across mobile and desktop, Israeli startup Overwolf’s growing open platform for game apps and in-game services offers game developers the opportunity to tailor-create specific tools to fill any gaps they may come across in their favorite games and improve the overall gaming experience. Developers use Overwolf’s platform to create real-time coaching services, analytics solutions, video recording tools, and other supportive capabilities overlaid on popular PC and mobile games.
In 2018, Overwolf raised $16 million in a Series B funding round led by Intel Capital. It was Overwolf’s third investment round after a seed round in mid-2011 and a series-A round at the end of 2013.
The Overwolf team. Courtesy
The financing round followed the announcement of a joint fund of over $7 million by Intel and Overwolf, for the purpose of investing in apps and mods for hardcore gamers, reports VentureBeat.
“We’ve designed the fund’s evaluation process to be simple and fast,” said Overwolf CEO Uri Marchand, hoping that the structure of the fund will encourage developers to “focus 100 percent of their efforts on making the best possible application, mod or game extension.”
Innovative cloud-gaming startup Simplay offers developers the tools to build cloud-streamed, interoperable versions of their game.
The startup was founded in 2016 by Gil Tov-Ly, who serves as CEO, and Roman Noze, the company’s CTO.
“As passionate gamers ourselves, Roman and I were focused on delivering ultimate available content to any gamer worldwide without the need for them to constantly have to upgrade their hardware,” Tov-Ly tells NoCamels.
Latency and weak networks are often the biggest obstacles for developers hoping to upscale, though Simplay’s Shift advanced cloud gaming technology is capable of delivering local-quality gameplay on the cloud. “Our protocol for cloud gaming can mitigate most network issues, resulting in a very stable cloud gaming experience,” says Tov-Ly.
First, Simplay creates a cloud image of the game, then generates a URL for a browser-based display and allows the gamer to publish and distribute just as they would normally.
In addition to appealing to companies like Google, Microsoft, and EA, Tov-Ly says Simplay’s flexible, widely-applicable service uniquely empowers up-and-coming developers whose barriers to enter the developing industry are necessarily more significant than larger studios: “Our technology is really unique, it is really innovative, providing a truly great and low latency gaming experience. So potentially it will strengthen the proposition of emerging developing studios, while it will also significantly expand their audience reach.”
In May 2018, sports fan engagement platform Quarterback raised $2.5 million in its seed investing round for what the company claims would redefine the way superstar eSport streamers engage with their fans.
Viewed as a potential Twitch competitor, Quarterback aims to differentiate itself from the eSports streaming giant by giving streamers total content control. Streamers can launch their own fan club gaming leagues complete with giveaway prizes, daily challenges, and the ability to compete with other streamers’ leagues. The platform monitors streamers and automatically creates challenges relevant to their activity and fanbase.
Quarterback says it opens up monetization channels previously inexistent in eSports. Streamers no longer need to be actively creating content in order to make money; they can engage with their fans even when they’re offline.
When asked if Quarterback has an equivalent in traditional sports, Quarterback founder and CEO Jonathan Weinberg told L.A. Biz, “The closest model would be fan clubs or development/farm leagues of traditional sports in a way. But generally, no. While most traditional sports fans do not play the game themselves on a regular basis, 94 percent of esports fans play the games themselves, and they do so 7x more time than they watch content. Just as streaming is unique to esports, so is Quarterback.”
Unlike traditional sports fans, eSports fans tend to be extremely active players, as well as watchers. Quarterback’s game-overlay format allows fans to seamlessly integrate streamers into their typical gaming experience and gives streamers continuous monetization even as their fans retreat to their own gameplay.
FTX Games is an award-winning social and mobile game studio that specializes in building games based on major box office films and TV series. In 2016, the San Diego-based developer was acquired by the world’s largest online gaming software supplier, Playtech, and rebranded from the original Funtactix Games, founded in 2006 by Yaron Leifenberg.
FTX Games combines best-in-class entertainment properties with skilled development teams, who have “decades of combined experience in building, marketing, licensing, and managing movie-based games across a wide range of platforms,” as reports Start-Up Nation Central.
The developer’s remarkable Hollywood reputation is the product of a large collection of exciting, well-received titles such as Mission: Impossible (2012), The Hunger Games (2012), The Walking Dead: Casino Slots (2018), and Breaking Bad: Criminal Elements (2019). The studio’s current most popular mobile game, Narcos: Cartel Wars (2016), accounts for 400,000 of the company’s 700,000 total monthly downloads.
Retail will never be the same. And behind just about every major move, regardless of market, vertical, innovation and disruption is Amazon. Twenty-five years ago, Amazon was this new book distributor with a funny name that was saturating the airwaves with branding. It took a while, about a decade before Amazon was the undisputed champion of book ecommerce. And around the same time it started to, after a decade of losses in the billions, did the company get in the black.
You would think that Amazon’s many venture capitalists and investment bankers would be satisfied to see daylight between itself and actually making money, but Jeff Bezos was only getting started. By around the time that the world was recognizing Amazon as the world’s largest book distributor, a position it was unlikely to lose, Bezos was already preparing to make Amazon the go-to site for every retail product available, plus some that would need to be invented, namely the Kindle and Alexa voice recognition, and some logistics software that runs the most complex distribution chain the world has ever seen. Oh yeah, and let’s not forget the early adoption of drone technology.
Featured post: Artificial Intelligence: part IV
We feel the Amazon effect everywhere. And so do retail dinosaurs like Sears, JCPenney, and to a lesser extent, Toys-R-US, all of whom are either bankrupt or desperately seeking a buyer before it’s too late. We also see the Amazon effect with its acquisition of Whole Foods and its market entry into content creation and distribution via Amazon Prime which also includes original programming similar to NetFlix.
In the wake of the Amazon effect is a host of 2nd tier service providers and distributors such as Uber, GrubHub, and Wayfair. And considering Amazon’s market power, which is already enjoying monopoly status as defined by the United States Department of Justice in several markets right now, it behooves Amazon to allow some competition while, at the same time, the music distribution business in which Amazon is a player, remains dominated by Apple’s iTunes. Yes. It’s complicated. What used to be well-defined and demarcated industries are now distribution channnels within a monolithic super eTailer. And as more traditional retailers are regulated to the scrap heap of history, look for Amazon to glide in and gobble up a few more for pennies on the dollar since it knows there will always be some need for brick-and-mortars. So why pay top dollar when you can be the cause of their demise and the savior of their resurrection. That pretty much sums up the Amazon Effect.
Isrealitech startups are humming along, raising $1.55 billion in 128 deals in the first quarter (Q1) of 2019. This marks a 28 percent increase in capitala and a 15 percent increase in the number of deals compared to last year’s first quarter.
There were also three deals of $50 million or more this past quarter, with cybersecurity startup Cato Networks raising $55 million in January, cloud technology startup Redis Labs raising $60 million, and Lightbits raising $50 million.
See featured article on artificial intelligence.
In Q1 2019, according to the report, deals higher than $20 million were responsible for 64 percent of the total amount invested, while seed and smaller rounds in the $0m–$5m range accounted for less than seven percent, continuing a downward trend observed since late 2015.
There was a major increase in deals that were between $5 million and $20 million (46 total) and that accounted for 40 percent of the overall deals this quarter, according to the study.
The most noted figure in the report was for C Round deals, with Israeli companies raising some $476 million in 17 deals, the highest figures since 2014.
Deals backed by VCs amounted to 71 in Q1 2019, compared to 57 non-VC-backed investments. The former accounted for $1.3 billion of the total raised this quarter, an amount that is lesser than the $1.5 billion raised in VC-backed deals in 2018’s Q4, but the highest in recent years.
“Israeli high-tech opened the year 2019 with momentum, said Shmulik Zysman, founder and managing director at ZAG-S&W. “We are particularly optimistic as the first quarter of 2019 was the most successful first quarter in the past six years, both in terms of total funding and number of transactions. Another reason for optimism is the high involvement of venture capital funds in the amount of capital invested – one of the highest in the last five years”.