VentureBeat

Conduit, an Israel-based startup that lets anyone customize a browser toolbar that they can offer to their friends or others, reports rapid user growth.

Rapid enough, at least, to draw $8 million in a second round of financing from aggressive venture capital firm Benchmark Capital. This follows an initial $2 million investment by Israeli venture firm Yozma two years ago.

Chief executive Ronen Shilo said Conduit is doubling revenue, users, and publishers every quarter.

He said he chose Benchmark, well-known for its financing of eBay, Red Hat, MySQL (which was just sold to Sun today), and Second Life in part because of the network of contacts it can provide.

Users have downloaded 30 million toolbars from sites that offer Conduit’s toolbars, the company says. That’s up from 12 million when we last covered the company in August. Conduit reports 600 new content publishers creating one of its toolbars every day.

An example of a Conduit toolbar is below. Conduit targets publishers, including VentureBeat, letting them create toolbars with things like a search window, RSS feeds, podcasts and other things — all customizable from an online dashboard.

It lets publishers drag and drop widgets onto that toolbar, and create things like alerts. For example Fox News might use the toolbar to send you a urgent news alert/update. Or if YouTube provided you a toolbar, it could use it to alert you to new videos of your choice.
The Israel-based company boasts 140,000 publishers in its network, from Fox News to Greenpeace, and Lufthansa to Major League Baseball. The toolbar may not be a novel innovation itself, but by letting publishers customize toolbars for their own community of readers, it hopes to differentiate itself from other toolbar creators, such as Google, Microsoft, and Yahoo.

Users have the ability to add the content they want into their toolbars. For example, if you downloaded a Lufthansa toolbar, not only would you have access to the airline company’s booking engine, but you could add a RSS feed from your favorite blog (VentureBeat, of course).

Conduit has plans to open an office in East Asia and Europe later in 2008, Shilo said.

Conduit will not seek to monetize toolbar users. Rather, it will focus on providing advanced-tools and services at cost for publishers.

The company shares gets ad revenue from Google by making it the default search engine within the toolbars. Shilo says the company is “cash positive.”

With all the free tools, users of Internet browsers Safari and Opera will be disappointed: Conduit is only available for Internet Explorer and Mozilla’s Firefox for the time being.

Although for now Conduit is limited to toolbars and desktop alerts, Shilo says he has a much bigger plan for the company. He sees it as a new “method of communication” between publishers and users, and wants every website in the world to use Conduit’s toolbar system.

Conduit is a company that lets Web site owners and bloggers build a customizable toolbar for their visitors, and it says it is growing quickly.

We wrote about the company last year. It boasts 12 million sites using its toolbar. Today, the Israeli-Redwood Shores, Calif. company lets Web surfers find toolbars with preloaded groups, for example of top tech blogs, including ours.

It also lets you search for any of the toolbars, on a network called MyConduit. Once you’ve downloaded one, you can then add others to a drop-down menu without a separate download. This lets you use the toolbar of your favorite site, but also subscribe to countless others, which you can then carry around with you latently — accessing them from the pull-down menu. VentureBeat’s toolbar can be found here.

The company raised $2 million last year, and is now looking to raise another round of capital. It says it is profitable (cash-flow positive), and is now nearing $10 million in revenue a year — which is striking. It relies solely on ad revenue it shares with Google by letting that company power the search on the toolbar. See a shortened version of our toolbar above, and longer one below (shrunk)

Here’s the latest news on Google stuff:

Google’s 900 millionaires figure out what to do with their money — Recent estimates suggest more than 900 Googlers became millionaires at the initial public offering, and that 100 of the first 300 workers have quietly resigned. Meanwhile, early Google investor David Cheriton (he joined Ram Shriram, Bechtolsheim and others in the first $1 million angel round) turned his $200,000 into more than $1 billion, and yet is still too cheap to pay for parking at Stanford. And when a Canadian University asked him to donate $25M, he at first thought it was ludicrous, but then realized he could afford it without landing in the “poor house.” So Cheriton did much better than we originally thought. Remember the legal tussle, when he was forced to sell early, and reports only referenced $58 million?

Meanwhile — Google has called in a doctorate in organizational psychology who has designed a survey to help Google hire the right people. They’ve got a 300 word questionnaire, and apparently analyze two million data points — all to figure out how best to lure, keep and organize the company’s workers.

Battle of the search toolbars — ChaCha, the search engine that provides human “guides” to help you in your search, is paying its guides $1 per month for every person they get to download the toolbar, and is giving equity to the guides who win the most converts. Meanwhile, Conduit, which provides blog and other Web site owners with a personalized toolbar, has signed a deal with Google, making it the default search engine on the Conduit toolbar. We reviewed the fast-growing Conduit here.

Google’s “Tips” removed — Google has removed its “Tips” feature, after receiving a torrent of criticism. The feature promoted Google’s services, such as its own photo-sharing site Picasa, at the top of the results, and people said that went against Google’s policy of giving unbiased results.

Google fights back in China — As reported earlier, Google invested in Chinese music and video download service Xunlei.com. Various reports from NYT and Pacific Epoch say Google gave $5 million. Google also signed a deal with China Mobile, the company’s leading carrier, to provide search on its mobile phones. These are good moves. Rival Chinese search engine Baidu.com leads in part because of its music download service. Xunlei may help close the gap. It was started in Silicon Valley by two Duke computer science graduates, Zou Shenglong and Cheng Hao, and they moved the company to China in 2003. The NYT says Google now owns 4 percent of Xunlei — valuing the company at $125 million.

Conduit, an Israeli company with offices in Redwood Shores, offers a customizable toolbar that any Web site owner can provide to their visitors.

It is a very useful feature. This lets Web site owners retain loyalty of its visitors. If your visitors download the toolbar, it appears across the entire length of top of their browser; you the Web owner can ensure your site remains a prominent fixture on the toolbar’s features.

Here’s a VentureBeat toolbar you can download, for example. We’ve pasted a visual below.

You’ll see the red “news” icon in the middle gives you a way to get a glimpse “Wire” stories, which we put in the toolbar assuming most people aren’t RSS’ing to it yet. On the left, you can type a word in the search bar, and then pull down the menu where it says “search” on the right, to search the Web, or within VentureBeat, or eBay or other sites. This is just two of a multitude of features Conduit offers. (This was done quickly, and we may issue a better VentureBeat toolbar shortly).

The toolbar has been popular enough in trial mode over the past 18 months that its customer base has grown to 125,000 publishers in 12 countries, the company said. More than 1.8 million users have downloaded the toolbar in just the last quarter. The company says it should have 10 million users by the second quarter of next year without doing anything. At this rate, this company may have a chance of moving beyond being a mere feature, and have a business on its hands. Let’s see who else goes after the market.

Conduit is free and hosted so you can produce one on the fly, and its features are extensive. We tried it out, and it is straight-forward to create your own. Visicom Media offers a competing product, but its main product is a software download that you have to pay for, and it’s not hosted online. However, it has recently started offering a basic free version.

Conduit gets paid by claiming a cut in the advertising that runs beside search results in toolbar’s search box — which is powered by Ask. Conduit is already getting more than 10 million monthly searches through that search bar, VP of Marketing Reena Jadhav said.

Major League Baseball, Fox Carolina TV, Greenpeace, REMAX and Blogdigger are all customers using the toolbar.

Conduit says 82 percent of USA Cycling Pro Championship race fans chose to download its toolbar.

Conduit provides customers using the toolbar reports on their users, including the number of new users, active users, and ways to get more information from their by creating a login page (though does not track information on individual users; it is aggregated data).

Conduit has $2 million in funding from Yozma, an Israeli venture firm.