Venture capital in Israel

Venture capital in Israel refers to the financial capital provided to early-stage, high-potential, high risk, growth startup companies based in Israel. Israel's venture capital industry was born in the mid-1980s and has rapidly developed since. Israel currently has about 70 active venture capital funds, of which 14 are international VCs with Israeli offices. Israel's venture capital and incubator industry plays an important role in the booming high-tech sector that has been given the nickname "Silicon Wadi", considered second in importance only to its Californian counterpart, the Silicon Valley.

According to IVC, Israeli Research Center, in 2015, proceeds from Israeli startup M&A (exits) exceeded $9 Billion – up 16% from 2014. The average exit rises to $87 million – 43% above 10-year average. Software topped all exits with $3.88B

According to IVC, In 2015, venture capital investment in Israel stood at $4.43 billion – the highest annual amount ever. In comparison, In 2008, venture capital investment in Israel stood at $1.9 billion. A record 708 companies raised money and the average size of the financing round was $6.3 million, compared with $5 million average in 2015 and a $4 million average deal in the past 10 years.

Israel's venture capital industry was born in 1985, when the first Israeli venture capital fund, Athena Venture Partners, was founded by Major-General , the past Chief of Staff of the Israel Air Force; Dr. Gideon Tolkowsky; and Frederick R. Adler, a pillar of the US venture capital industry who had conceived the notion of taking Israeli High-tech companies public on NASDAQ. Subsequently, in 1990, Gideon Tolkowsky and Yadin Kaufmann founded Israel's second VC firm, "Veritas Venture Capital Management", whose main investors were Anglo American Corporation of South Africa and De Beers. The success of the Venture Capital industry in Israel continued with Yozma (Hebrew for "initiative"), a government initiative in 1993 offering attractive tax incentives to foreign venture-capital investments in Israel and promising to double any investment with funds from the government. As a result of their efforts, Israel’s annual venture-capital outlays rose nearly 60-fold, from $58 million to $3.3 billion, between 1991 and 2000. The number of companies launched using Israeli venture funds rose from 100 to 800. Israel’s information-technology revenues rose from $1.6 billion to $12.5 billion. By 1999, Israel ranked second only to the United States in invested private-equity capital as a share of GDP. It also led the world in the share of its growth attributable to high-tech ventures: 70 percent. According to the OECD, Israel is also ranked 1st in the world in expenditure on Research and Development (R&D) as a percentage of GDP.

...
Wikipedia