The VC Market in Israel

Flag of Israel

Flag of Israel

Today’s economy and the history of Venture Capital play together in a very important role. VC firms are getting smarter as the recession hits us all from our wallets to the bank. Efraim Landa is an expert in this market, and can lead you to being accepted in VC funding regardless of these changing times. There are about 70 active venture capital funds listed in Israel’s VC Market alone, 14 of these are international VCs but have offices in Israel, the others operate in Israel and benefit the economy of Israel. Investinisrael.gov discusses staggering numbers for VC firms in recent years. In the year 2010, “391 Israeli high-tech companies raised $1.26 billion, 13% above the $1.12 billion raised in 2009, but 39% below 2008 levels which was then the highest amount raised in 7 years. In the fourth quarter of 2010, 100 Israeli high-tech companies raised $344 million – 25% above the $275 million rose in the fourth quarter of 2009, and slightly up from the $341 million raised in the third quarter of 2010”

In addition, Venture Capital Journal quotes Zeev Holtzman, Partner at Giza Venture Capital, “Israel’s venture capital and startup industry is headed for collapse.” The statement comes to us as no surprise because in 2010 no money was raised in venture funds. Israel is well known as the country with more Nasdaq-listed companies per capita than any other country regardless of this recent downfall.

So what now? Shown the drastic changes in investments and in earned capital through these trying times we would predict that there is no hope for VC firms in Israel. There is a bright side to all this news, in 2011 things got better for VC firms in Israel. As shown with Pitango, a big time Israeli VC firm, they raised approximately $350 million in 2011 alone.

Despite these fluctuating numbers, VC firms are still making it in Israel and are on a rise. There are a few noted and well known VC Firms that operate and who operate well in Israel.

Popular VC Firms in Israel:

  1. Apax Partners, Inc – Tel Aviv Israel – popular companies they invested in are Travelex, Sulo group, General Healthcare Group, Tommy Hilfiger, Bob’s Discount Furniture, Spyder Active Sports Inc, Rue21,
  2. Battery Ventures – Israel – popular companies they invested in are Tech Process, Travelguru
  3. Benchmark Capital – popular companies they invested in are FilesX, Skybox Security, Conduit, Metacafe, Mirage, Gizmoz, NetXen, Finjan Software,
  4. Bessemer Venture Partners – popular companies they invested in are Wix.com, Soluto, Storwiz, Bill Guard, Altair Semiconductor, Siano Mobile Silicon Inc.
  5. Canaan Partners – popular companies they invested in are Call my Name, Mobilitec, Peer39, PrimeSense, Viewbix

Israeli startups have often specialized in categories like security, semiconductors and networking equipment, these industries can require a big chunk of capital and these days there isn’t much excitement in these industries. Sure there is still a need, but some feel these sectors are played out. With that said, it’s not completely the recession that has caused these staggering numbers. In real time, Israel’s VC Firms are thinking smarter, are quite innovative and are still thriving in today’s economy. Israel is still on the map and here to stay!

 

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About Efraim Landa

My name is Efraim Landa I am an entrepreneur and an expert in venture capital. I am the co founder of Effi Enterprises, a venture capital firm as well as the co founder and CEO of Gluco Vista, a company that is in the process of developing a non invasive glucose meter for those with diabetes.

Posted on November 17, 2012, in financial history, the economy, VC financing, Venture Capital and tagged , , . Bookmark the permalink. 1 Comment.

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