JERUSALEM (MarketWatch) -- People judge public offerings by their size before anything else.

That’s why many were impressed when 2010 produced history’s four largest initial public offerings, each of which raised more than $20 billion. Considering that 12 years had passed since the previous record IPO, Japanese telecom giant NTT’s $18.4 billion, analysts saw in the new trend a microeconomic, macroeconomic and geostrategic crystal ball.

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Peering through, they learned that General Motors has a bright future, the global recession is over, and China, where three of the mega-offerings originated, has established itself as America’s main economic rival.

It will likely take a few more years before we know just how valid these conclusions are and how visionary the investors in these IPOs were. Fortunately, plenty of smaller-scale IPOs are out there, and while these may not say much about the future of superpowers, they still say everything about the nuts and bolts of enterprise and investment.

In Israel, two such examples recently emerged -- one a failure, the other a success and each where it was least expected.

The failure came in the thick of the high-tech sector, which dominates the Israeli economy and includes the bulk of the 139 Israeli companies that trade on U.S. stock exchanges.

It was led by one of Israeli high-tech’s heroes -- Dov Moran, the engineer who invented the flash drive, commonly known as the Disk-on-Key, where millions worldwide now routinely store much of the data around which their private and professional lives revolve. And it was as full of promise as the original Walkman.

M-Systems, the company through which Moran and his colleagues made the Disk-on-Key and its sibling, the Disk-on-Chip, was sold in 2006 to flash-memory maker SanDisk for $1.6 billion. No one scoffed, therefore, when Moran founded a new company, Modu, which he said would produce the world’s lightest and smallest cellphone.

The Modu phone is indeed both sleek and functional, offering a variety of jackets to cover an ultra-light device smaller than a credit card. And it has everything that advanced cellphones have: a camera, a music player and radio, and on top of these a super-deep data container.

Modu, designer of sharply sleek and richly functional cellphones, was founded by one of Israel’s top high-tech investors, Dov Moran. Modu

Moran hired some 250 people and managed to raise more than $120 million from assorted venture capital funds and private investors, including himself. It wasn’t enough. After four years in the red, he set out to take Modu public on the Tel Aviv Stock Exchange. What the company lacked in performance he hoped to offset with his vision and record. Last month Moran grimly announced that the IPO had failed and he would dismiss most of the company’s surviving 130 employees.

Pundits rushed to attribute the failure to hubris, short-sightedness and bad luck. Some think Moran overplayed his hand, some say he would have easily raised the money on Wall Street had he arrived there before the 2008 meltdown, and some say he was trying to create a Nokia in Israel, a country that specializes not in production but in invention, as he should know better than all others.

These and the rest of Modu’s Monday-morning-quarterbacks may yet live to eat their hats, as Moran is an engineer, not a gambler, and a long-distance runner who continues to believe in his product and remains intent on making it a success.

However, one thing Moran must realize before he moves on is that his new brainchild is crucially different from his original claim to fame: The Modu merely further shrank and empowered what had already been small and powerful, whereas the Disk-on-Key’s break with its cumbersome predecessor, the floppy disk, was revolutionary.

Before Napoleon was born

Incidentally, several days before Modu’s failed IPO, Israelis got a reminder about commercial revolutions, and how unbearably simple they can be to both conceive and take public.

Few things can contrast Modu’s world of microchips, megabytes, and mini-touch-screens more sharply than sparkling water, a quintessentially low-tech product that was invented just before Napoleon was born.

And yet, SodaStream, SODA, +0.60% the Israeli producer of a kitchen-table contraption that makes water bubble, last month raised $109.5 million on Nasdaq, one of the largest IPOs of the year on that exchange, and then saw its share price more than double in less than a month.

There was no Disk-on-Key-type of invention at stake in this tale, only some very smart repackaging and sensitive nostrils that sniffed well where the consumer world was headed.

It began with the purchase of a veteran soda-machine maker called Soda Club by Israeli entrepreneur Yuval Cohen, and his enlistment of fellow Harvard Business School alum Daniel Birnbaum to leave his position as chief executive of Nike Israel to run his friend’s new company.

SodaStream's Pure model, which produces sparkling water and flavored sodas in 30 seconds. The system uses reusable 1-liter bottles and closures to retain the carbonation. SodaStream

One thing that demanded urgent treatment was appearance. After renaming the company SodaStream, the new management took its main product, a pale bottle-container that is a little taller and fatter than a family-size beverage bottle, and redesigned and painted it in a variety of happy colors.

In today’s world of designer kitchens, they figured, whatever you want planted on a kitchen counter’s limited space must be as good looking as the rest of the select, and increasingly sophisticated, food processors, toasters and coffee machines with which it is bound to cohabit.

But before that there was the substance. Why would anyone want to assume the ability to make soda by himself? Three reasons, it turns out: convenience, health and idealism.

Convenience – because people don’t like paying for a lot of bottles at the supermarket and then shlepping them up stairs, through elevators, across apartments and into pantries, where they take up precious space. Health – because the soda maker can come with a colorful line of organic and sugarless syrups that will appeal to the younger generation’s habits and tastes. And idealism – because if you care for the environment, you will be happy to drastically cut your consumption of plastic bottles.

Until five years ago the company served a sleepy, narrow, and ageing clientele. Now, armed with its new vision, SodaStream went not to the equity markets but to the bottomless international beverage market, where it marketed the soda maker as the call of the future, when the world will throw away a lot less than the annual 300 billion plastic bottles that it tosses now.

Within four years SodaStream was serving 4 million drinkers in more than three dozen countries through 35,000 stores. Last year sales crossed 100 million euros ($131.8 million), and the first operational year’s net loss of €1.6 million became net income of €7.1 million.

Only after all this was accomplished did the company go to Nasdaq, and this week it reported that adjusted third-quarter net income rose 52% from the year-earlier period, to €3.9 million, or €0.31 a share. Revenue was €42 million, also up 52%.

Less than half a decade ago, mentioning the soda maker in the same breath with foreign-traded Israeli shares like Magic Software, MGIC, +2.89% Gilat Satellite Networks, GILT, -4.40% Formula Systems FORTY, +9.36% and AudioCodes AUDC, +1.20% would have been the equivalent of serving a cereal bowl in the middle of a gourmet meal.