Assessing value of total investment in Israeli high tech – 3 pointers
It is turning out to be another good week for Israelis who like to show off the country’s ‘start-up nation’ status. The Chinese group, Fosun, has just bought out Alma Lasers with their special cosmetic surgery applications for a cool US$240 million. Happy days!
Israel continues to reap the rewards of being a Middle Eastern version of Silicon Valley. Only last week, I met up with a group of London-based merchant bankers, many of whom were visiting the Holy Land for the first time. So used to learning about Israel from the BBC or similar, they were each positively stunned at the economic and scientific miracle they were presented with.
So, here are three basic stats to reiterate just how much Israel is placing itself at the forefront of new technologies and how in turn this is attracting inward investment.
First, “Preqin’s Venture Deals Analyst shows that since 2008 there have been 403 venture capital financings in Israel, with an aggregate value of $2.53bn.” Significantly, in 2012, a year noted for the economic malaise in the Mediterranean Basin, there were 79 deals. Within the first four months of 2013, a further 23 had been completed.
Perqin claims to hold data on 83 Israeli VCs, which have raised over US$10 billion in the past decade. JVP and Fimi are considered two of the world’s best performers in their field.
Second, a new survey released today indicates that “57% of Israeli venture capital executives expect foreign investment in Israeli start-ups to increase over the coming year, and 43% expect that the number of high-tech exits will grow”. As Siemens, Microsoft and others continue to strengthen their accelerator programmes, this trend is likely to continue.
A third interesting stat is that during the first quarter of 2013, Israeli high-tech firms raised $474 million despite the continuing global slowdown. Within two days of this news being published, Fitch reaffirmed Israel’s A credit rating.
In other words, for all the abnormalities (such as import monopolies and the unions at the ports), the Israeli economy is essentially sound. Let us hope and pray that the vested interest groups keep it that way.
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