In May 1998, America Online (NYSE:AOL), which hails from the state of Virginia, bought a little Israeli startup called ICQ for almost half a billion dollars. Four years later, a delegation of Virginia has braved the scary headlines and federal travel warnings to look for more breakthrough technology.

Although most foreign investors have taken Israel off their list of destinations, this week VITAL the Virginia Israel Tech Alliance spent a week combing the country, from Katzerin in the north to Beer Sheba, for opportunity. The four delegation members met with managers of 60 hi-tech companies, with the goal of choosing 15 to assist in penetrating the U.S. market, through partnerships with Virginian companies.

VITAL's assistance focuses on three aspects that are key to succeeding in the U.S.. One is obtaining financing through contacts with Virginian companies or venture capital funds. The second is assistance on planning and establishing a local business, while adapting the product to the needs of the American market. The third aspect is logistics, including the possibility of taking advantage of the Virginia Tech Corporate Research Center, which operates as a quasi-incubator for 106 American technology companies.

The delegation consisted of four of VITAL's eight-member committee, led by Ralph Robbins, a representative of the governor of Virginia. He was joined by Joe Meredith, the president of the Virginia Tech center, Prof. Yossi Ben-Dak, the chief scientist of Xybernaut, and attorney Thomas L. Bowden of McCandlish Holton, which provides legal and business advice to companies.

Robbins, an ex-Israeli who moved to the United States many years ago, views the project as a business opportunity for Israeli post-incubator tech companies. The program is built around the needs of Israeli companies, he says, which are usually good at developing innovative tech but tend to fail at the critical stage of penetrating the U.S. market, due to their lack of experience and knowhow in building suitable business plans.

The delegation looked principally at companies specializing in home security, medical technology, Internet, communications networks, and environment. The sixty candidates, chosen from a list of 200, include MDG Medical (which has a unique patented drug delivery cart to eliminate nursing errors in hospitals); BioSensors Technologies (which can detect suspect molecules); Elisha Medical (airways systems for patient care); Lev El (cancer detection based on skin electronics); and Surface Technologies (high tech solutions in the areas of tribology and surface engineering).

The delegation was surprised by the plethora of potential choices, Robbins said. More than half the companies they inspected had potential, and choosing only 15 was a tougher task than envisaged, he elaborated.

The next stage for the companies that passed muster is to meet with representatives of some 100 technology companies and investment funds from Virginia at a conference in mid-October.

Some star participants in the conference are Lior Samuelson, a co-founder of Mercator Broadband, which has invested in another Israeli startup Sivcom; Len Leader of AOL-Time Warner Ventures; and Thomas Robertson of Carilion Healthcare System, which recently set up a med-tech investment fund.

Leader and Robertson are also members on the VITAL advisory council, as are two star Israeli entrepreneurs Zohar Zisapel and Yossi Vardi, none other than the great mind behind ICQ.

ICQ's meteoric success will be hard to emulate. Even so, Robbins' program to bring 15 Israeli hi-tech companies into the American market opens a new door to opportunity for the entire Israeli technology industry.