Mom and Pop software company beats the big boys

Despite its tiny size, Degel Software has provided software solutions and technical expertise to some big name companies looking for solutions in product development. When British company Electric Pocket wanted to update its popular BugMe! product from Palm OS to …

Despite its tiny size, Degel Software has provided software solutions and technical expertise to some big name companies looking for solutions in product development. When British company Electric Pocket wanted to update its popular BugMe! product from Palm OS to next-generation mobile phones, it turned not to an international giant for help, but to a tiny mom and pop company working from the basement of a house in Beit Shemesh, near Jerusalem.

Despite its tiny size, Degel Software, a four-man software development boutique, has, over the last three years, provided software solutions and technical expertise to some big name companies looking for solutions in product development.

The company’s first client, for instance, was Sun Israel Research Center, where Degel helped the company optimize and enhance J2ME, a version of Java for small devices. Other clients include NTT of Japan, Intel Israel, Basis Technology in Massachusetts, and a huge global instant messaging company based in Israel. Degel began working with the instant messaging service, which declined to be named, in August 2001, and the work continues today. In September last year, Degel developed an instant messaging client compatible with Siemens, Sendo, Nokia, Motorola and Ericsson 2.5 and 3G cell phones.

Degel Software was initially founded in 1988 by David Goldfarb, 41, a specialist in Artificial Intelligence who graduated from MIT in Boston a year before immigrating to Israel. Goldfarb ran the company as a one-man operation until 1995 when he ceased operations for five years to work on a new project, 2am Development. When this went under in the dot.com collapse at the end of 2000, Goldfarb hired three engineers and reopened Degel for business.

In the past, Degel focused mostly on Windows development. From 2001, however, the company began to focus on wireless technologies, which Goldfarb identified as a promising new sector.

Degel works as a technical advisory company. Instead of inventing new products itself, it offers technical expertise to companies that do.

“I’m not a visionary,” admits Goldfarb. “Our strength is not coming up with a killer application or figuring out what the market wants, but in helping the person who does have this vision turn it into reality. We work with companies that have excellent marketing and management, but don’t have the in-house skills to turn their dreams into real products at a fast enough speed.”

Degel became involved with Electric Pocket, a privately held company that provides wireless solutions to names like Vodafone, Ericsson, Palm and Handspring, in 2002. The company found Degel after reading an article by one of its engineers, Andy Weinstein, on the Symbian web site. The British company approached Degel, and asked them to redesign BugMe!, a note-taker and memory jotter popular with Palm OS and Pocket PC users, for the Nokia 7650, a next-generation mobile phone with a built-in camera and a voice recorder.

Unlike Palm, Degel had to find a way for users to operate the note-taking technology without a keyboard, since the keypad on mobile phones is inconvenient and slow to use. Degel therefore incorporated the use of photographs and audio clips and developed an easy-to-use joystick-driven wizard style interface implementation. Today users of the Nokia 7650 can record notes or reminders, or as Goldfarb suggests, take a photograph that does the same job.

Say you’ve got chicken cooking in the oven and want to remember to take out in 20 minutes. All you have to do is take a picture of the chicken in the oven and then click 20 minutes. When the alarm rings, the photo appears on screen, reminding you to turn off the oven. “It’s a two-second process,” says Goldfarb. “This was totally impossible to do with Palm.”

Degel started work on the BugMe! project in November last year, and completed it a month later in time for Christmas. Since then the company has carried out a similar upgrade for the Ericsson P800 phone. This was introduced in February. Degel is now involved in other projects for Electric Pocket.

“Degel has a solid reputation and we found them to be a terrific partner throughout the entire project and, most importantly, with the quality of the final product,” said Iain Barclay, co-founder and chief product officer of Electric Pocket.

Interestingly, Goldfarb only met management at Electric Pocket just recently. For the first project the two companies worked through e-mails and telephone calls alone. “It just shows how two companies 3,000 miles apart can find each other on the web and work together effectively,” says Goldfarb.

Degel is now involved in several other projects in the field of utility and office support applications. No names have yet been released.

At present, Degel remains a small-time player working in the big league. Last year company revenues were below $500,000. This year they should increase beyond that figure.

“We are getting a great deal of new business,” says Goldfarb, who despite the current recession recently brought in several new clients from the GSM Congress in France.

Goldfarb’s goal is to enlarge the company over the next two years to between 10 or 12 employees. When the company reaches this stage, he plans to bring on a new CEO skilled in management and marketing.

In most cases companies like Degel offer consulting services as a way to bootstrap new developments. Goldfarb, however, plans to remain a high-level consulting firm. “At Degel we hire the top one percent of engineers. We want to stay small and hire the best. I know that everyone on my team can walk into a company without assistance and get a product through the door. My staff thrive on solving problems,” says Goldfarb. “Our strength is being one step ahead of the game.”

About Nicky Blackburn

Editor and Israel Director, Nicky Blackburn has worked extensively as a journalist and editor both in Britain and Israel for a range of national and international publications including The Cambridge Evening News, London News, Travel Weekly, Israel High Tech Investor, and The Times of London. She was the Associate Editor at LINK Israel’s Business and Technology Magazine, and the High-Tech Correspondent for The Jerusalem Post.