Two venture capital funds, one Israeli and one American, are joining forces to set up an "Internet lab" to invest a total of up to $10 million dollars in 10 Israeli internet start-ups. Menlo Park, Calif.-based Lightspeed Venture Partners and Herzliya-based Gemini Israel Funds, which also has an office in the Silicon Valley, intend to focus the investment in second-generation Internet initiatives, knows as Web 2.0, over the next 18 to 24 months, whether content, marketing or mobile applications. "[An investment of] $1m. per company is nonetheless just the start for these companies. We hope that successful companies will emerge out of this that we will continue to invest in," said Lightspeed general partner Jake Seid. Seid and Gemini partner Danny Cohen explained that Web 2.0 is a "more connected, or social, web, built using more open technologies allowing richer interactivity." Companies participating in the wave often employ stronger business models, Seid said, adding that they are based on standard servers and the costs of getting Web 2.0 Internet sites to the market are much lower. As a result, the seed funding offered through the joint Internet lab can have a significant impact on the start-ups chosen, they said. "We are happy to be initiating activity that will contribute greatly to focusing the Israeli internet industry," said Cohen. As opposed to single-company investment programs, entrepreneurs included in the Gemini-Lightspeed program will benefit from access to the networks of two companies, Seid noted. The joint Internet lab will "combine the tremendously strong entrepreneurial talent pool and burgeoning Internet industry of Israel with the resources and connections in the US," allowing the start-ups "to leverage the best of both worlds toward building companies," he said. Start-ups also will benefit from a very quick process of investment, and "see money within very few weeks," Seid added. Though the project is still in initial stages, "already several companies seem to be very interesting opportunities," he said. Lightspeed is also active in East Asia, particularly in China, and has also made early-stage investment in non-Internet start-ups in Israel over the past decade. The group intends to continue to expand its activity in Israel through Gemini, Seid said. Active for 13 years, Gemini is one of the oldest venture capital firms in Israel providing early-stage seed investments. "We are in the process of bringing in dedicated people to work in the lab finding opportunities and helping companies grow," said Cohen.