RawSugar (the site is currently down), a company with offices in Israel and Silicon Valley, is closing shop (also reported by Steve Rubel and Rafael Sidi) and will enter the TechCrunch DeadPool. RawSugar can mosts easily be described as a del.icio.us competitor.

This is a company we’ve been tracking since August 2005. This is also one of the companies that I met with during my trip to Israel last year.

RawSugar never raised a big round of funding and simply ran out of money, it seems. And while this is a bit sad to see, the good news to come out of this is that the people working on the project can now move on to their next idea. It’s the way things go.

Last Sunday I attended an ad hoc tech lunch in Tel Aviv, Israel to meet six great web 2.0 startups there. Attending were founders from I4giveu, Maxthon, Raw Sugar, Spotback, Triplay and Yedda. Daniel Cohen from Gemini Israel Funds, Ouriel Ohayon (TechCrunch France author) and other tech enthusiasts were there as well.

We had a great meal and a great discussion. My pictures from the event are up on flickr here.

The six startups that were represented include:

I4giveu

Founder Alon Carmel is a gifted designer and developer and is getting ready to launch his stealth project I4giveu. Very few details on the service were revealed, but as always I love the email collecting landing page with promises of amazement in a very short time. Sign up here. One thing Alon did say was this: “Each user will earn his reputation from angel to devil according to his post ranked by other community users.” Sounds like fun!

Maxthon Browser

Netanel Jacobsson represented Maxthon Browser, the controversial but popular IE based browser that has surpassed 50 million downloads. Ouriel Ohayon writes about Maxthon here.

Raw Sugar

The executive team of Raw Sugar is based in Silicon Valley, the development effort is led by Frank Smadja out of Haifa, Israel. I’ve written about Raw Sugar on TechCrunch previously, and they are moving toward launch of a new feature which will automatically import tag and category information from blogs to create a single browsable and searchable directory. Great stuff.

Spotback

Spotback founders Micha Kaufman and Amit Kaufman gave me an early look at credential-protected Spotback, which is going to be a winner. Look for a full profile soon, but Spotback is a personalized news and rating/sharing site that has very strong features and will give front runners like Newsvine a real run for their money. Design and functionality is top notch. Sign up for the beta here. I would not be surprised if Spotback received joint Israel-US VC funding in the very near future.

Triplay

Yaron Orenstein spoke to me briefly about Triplay, a very young company that is looking to create a cross-platform mul­ti­me­dia platform (computer-mobile-television). There are very few details on the site, but Triplay looks interesting. “Think People NOT technology…TriPlay’s Super Messaging service will enable people to easily communicate all types of media and content across their PC, TV, and Mobile devices.” Look for a full review on MobileCrunch soon.

Yedda

I’ve been talking to Yaniv Golan and Avichay Nissenbaum, the founders of Yedda, since last December. See my teaser post on them from January. Yedda should be taking the wrapper off their service within the next few weeks, and I’ll be dong a full profile.

All of these entrepreneurs are humble and flat out brilliant. I’m excited to see good stuff coming out of Israel, and look forward to watching these six new companies grow.

At least two Del.icio.us competitors, Simpy and RawSugar (profiles) have begun paying users to use and promote their services. While the companies have different payment models, both pay based on traffic generated at a particular users page containing the user’s bookmarks.

Simpy

Otis Gospodnetic’s Simpy is allowing users to enter their Google Adsense account number and ads will be shown on their bookmark page. See Otis’ Simpy page for an example.

Simpy is paying 100% of the proceeds from Google to the user for any ads on the page (in fact Google pays the user directly).

Raw Sugar

Raw Sugar is taking a more direct approach – they are paying the top twenty “directories” (user bookmark pages) between $25 and $500 per month. Directories are ranked on raw traffic, and the first payouts were made earlier this month.

RawSugar also plans to pay users a percentage of advertising revenue in a similar way as Simpy.

Is this a gimick to generate attention or is it a viable long term strategy to generate user adoption? Pete Cashmore thinks these promotions should make Yahoo (now owner of del.icio.us) take notice (see his further thoughts in the comments below). Maybe he’s right. And the markets for these products are still in the very early adopter stage.

But it is going to be hard for anyone to overcome the del.icio.us network effect (not to mention Yahoo’s marketing muscle) with relatively small direct economic incentives. I am, however, looking forward to seeing how these promotions drive new user registrations and site traffic. At the end of the day, these companies have nothing to lose with experiments like these.

Company: Raw Sugar
Launched: June 2005
Location: Palo Alto, CA

Overview

Raw Sugar is somewhat similar to Rollyo, which we profiled yesterday. Raw Sugar basically combines del.icio.us type social bookmarking, with search (of your and other’s bookmarks, along with google results).

Social Bookmarking

You can save a URI found in Raw Sugar Search results, or use a bookmarklet to save any browsed page (support at this time for firefox and explorer only). You can also add a description and tags. Your tags are saved on your user page with a unique URI. This page is also customizable with images, pictures, etc.

For instance, taking someone at random, here is Frank, who is apparently just about to complete a world class bellyflop and likes, among other things, kung fu (if his tags are indicative of his interests). He also likes the Ramones, which is one of my favorite bands (reminds me that I need to create a Ramones station on Pandora).

Search

Raw Sugar offers a nice search service that leverages tagged pages and presents them in search results (keyword and tagged based results look to be mixed, which seems right). They also have a “refine” option after your first search, which further narrows the results set (something Technorati really needs to add).

Given that Del.icio.us recently added search, Raw Sugar may have a long hill to climb.

Overall, it’s a useful service that could use a little jazzing (and ajaxing) up of its user interface. The Raw Sugar blog can be found here.

Team

Ofer Ben-Shachar, CEO and Co-Founder
Frank Smadja, VP Engineering
Monica Laurence, VP Marketing

Additional Reading

BillSaysThis (regarding RSS feed functionality, I looked but can’t find it), Hatch.org, Businessweek, Guy Tavor,